When Do Hotels Charge Your Credit Card?
EG
Summary:
When a hotel charges your credit card depends on the property, its policies, and the platform where you book the room. Most hotels require payment at the time of check-out if you booked directly through its website or made a hotel reservation online. However, an upfront payment may sometimes be required.
One of the most important aspects of planning a trip is calculating your travel budget. Hotels can be one of the most significant costs of any trip, especially as inflation has increased prices even more. And as you plan your travel budget, you may be wondering when you’ll actually have to pay for your purchases.
For example, will you have to pay for a hotel room when you book it, even if it’s months in advance? Can you wait to pay the hotel bill until you arrive or at check out?
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When do hotels charge your card?
The hotel stay can be one of the most expensive parts of any trip. Before you book, it can be helpful to know whether you’ll have to pay immediately, or whether you can wait until your trip begins.
There are a variety of times when a hotel might charge your credit card, including when you book, when you arrive at the hotel, or when you check out. When your credit card will be charged depends on a variety of factors, including the hotel you stay at, the type of room you book, the platform you’re booking on, and more.
At the time of booking
First, some hotels and rooms require that you pay your full bill at the time of booking. These hotel reservations — known as prepaid rates — can be either refundable or nonrefundable, depending on the hotel’s policies. Often, hotels charge prepaid rates when you’re receiving a discount on the room.
There are benefits to paying for a hotel room upfront. For example, you can spread the costs of your vacation out over a longer period of time, rather than paying for everything at once. However, if you do book a room with a prepaid rate, you’ll have to budget accordingly.
It’s worth noting that not all prepaid reservations require that you pay at the time of booking. You’ll have to provide your credit card right away, but the hotel may not charge it until a certain number of days before your reservation (often at the time when the payment is no longer refundable).
Pro Tip
A hotel will likely require you to share your credit card information when you book the room, regardless of whether you have to pay upfront.
Prior to check-in
In some cases, a hotel may not require you to pay at the time of booking, but may still require an upfront payment. In this case, the hotel might charge your credit card between 24 and 72 hours before your reservation is set to begin.
Often, when hotels charge your credit card just before check-in, this payment coincides with the time at which your payment becomes nonrefundable. For certain reservations, hotels may state that a reservation is nonrefundable starting 72 hours before your check-in. In that case, that’s probably when the hotel will charge your credit card.
At check-in
Another time a hotel might charge your credit card is when you check-in. Hotels may require payment at this time for a variety of reasons.
For example, you may have to pay when you check in if you have a long stay planned. If that’s the case, the hotel may require you to pay the full bill upfront, or that you pay for a certain number of days.
At check-out
The final time when a hotel is likely to charge your credit card — and the time at which most hotels require payment — is when you check out. In most cases, the hotel will charge the credit card on file at this time. However, the hotel may give you the option of paying with a different credit card.
It’s worth noting that you won’t necessarily have to do anything to make your hotel payment. Many hotels don’t require you to physically check out. Instead, you can simply depart when your stay is over and leave your keys behind in the room or at the front desk. If you don’t visit the front desk to check out, the hotel will automatically charge the same credit card it has on file for you.
Charge vs. hold
Regardless of when a hotel charges your credit card, there’s a good chance they’ll place a hold of some kind on it either when you book the room or shortly before your reservation begins. This hold — known as a preauthorization — is likely to be for less than the cost of your stay. However, it allows the hotel to go back and charge your card later.
Don’t worry — the hold on your credit card isn’t permanent. It might stay on your credit card as a pending transaction until your hotel stay but will usually be released once you’ve checked out and settled up your bill.
Why hotels use holds
Hotels use holds for a couple of different reasons. First, placing a hold of as little as $1 allows hotel staff to verify the credit card information you’ve provided. By doing so, they know that when it comes time to charge your credit card, they’ll be able to.
The other reason a hotel might use a hold is as an insurance policy of sorts. First, it makes it easier for them to go back and charge your credit card for the full room rate. But it can also cover any incidentals, including room service, damage to the room, and more if necessary.
Pro Tip
When a hotel places a hold on your credit card, you won’t have to pay for it right away, but it may use up a part of your credit limit. And in the case of a debit card hold, the money may temporarily come out of your account, meaning that you won’t have access to it until after your hotel stay ends.
Charge vs. deposit
Some hotels also charge a room deposit, either in addition to or instead of a hold. Unlike a credit card hold, a deposit is usually the money you’ll have to pay upfront, regardless of whether you pay with a credit card or debit card. The deposit is then either returned to you when you check out or goes toward your final balance.
Why hotels use deposits
Hotel deposits can serve a couple of different purposes. First, deposits can cover any unexpected costs that arise as a result of your hotel stay, including room service, mini bar purchases, damage to the room, and more.
A hold can also serve as a down payment on the room. A hotel might charge a deposit if you’re planning a longer stay, requiring upfront payment for one or multiple nights.
What if I cancel my booking?
If you have to pay upfront for some or all of your hotel reservation, it’s important to understand what happens to that money if you cancel your booking.
The short answer is that it depends on your hotel’s policy and the agreement when you booked the room. Many prepaid rates are nonrefundable, meaning once you’ve paid the bill, you can’t get that money back even if you cancel. In other cases, you may only lose your deposit. Finally, many hotels have flexible cancelation policies, meaning you can cancel your reservation without losing out on any money.
It’s important to pay close attention to a hotel’s cancelation policy before you book a room. The last thing you want is to have to cancel a hotel stay and find yourself on the hook for hundreds — or even thousands — of dollars.
Pro Tip
Some travel credit cards offer trip cancelation insurance. Even if your hotel doesn’t refund the cost of your stay, your credit card may reimburse you.
Booking through a third-party website
Hotels may have a different policy depending on whether you book directly through the hotel, or with a third-party website. Often, hotels don’t require an upfront payment for reservations made directly through the hotel, either over the phone or on the website.
That being said, the same hotel may require an upfront payment for bookings made on third-party websites. As we discussed, prepaid reservations are often required for discounted room rates, which is often the case with these travel websites. You’ll have to decide for yourself whether the discounted room is worth the upfront (and possibly nonrefundable) payment.
FAQs
Do hotels charge your debit card right away?
Some situations may require an upfront payment for a hotel room. In other cases, you won’t have to pay until you check out. However, even if the hotel doesn’t require an upfront payment, it will probably require a hold or deposit of some kind.
Do you pay for the day you check out of a hotel?
The daily charge for a hotel room only applies to the nights you spend there. As a result, you won’t pay for the day you check out as long as you do so on time. However, if you don’t check out by the required time, the hotel may charge you for another night or for a late checkout.
How much do hotels usually hold on your credit card?
The amount a hotel will hold on your credit card depends on several factors, including the price of the room. Some hotels will hold around $50, while others will hold the full price of one night in the room.
Do hotels require a deposit?
Some hotels require a deposit, which is an upfront charge that will either be returned after your stay or go toward your final payment. That being said, not all hotels charge a deposit if they’re also using a hold.
How long does a preauthorization take to cancel?
In most cases, a hotel’s credit card authorization will be released 24 hours after your checkout. However, it could take several days for the hold to clear from your credit card.
Key Takeaways
- When a hotel charges your credit card depends on the hotel’s policies, the type of room rate, the platform where you book the room, and more.
- Depending on the situation, a hotel may charge your credit card when you book the room, before you check in, when you check in, or when you check out.
- A hotel charge is different from a hold or deposit, both of which act as insurance policies for the hotel.
- Be sure to read each hotel’s cancelation policy thoroughly to find out what happens if you have to cancel your stay.
EG
Erin Gobler is a Wisconsin-based personal finance writer with experience writing about mortgages, investing, taxes, personal loans, and insurance. Her work has been published in major outlets, such as SuperMoney, Fox Business, and Time.com.
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