Hotel Security Deposit Not Refunded – What Should I Do?

When booking a room, or checking into a hotel, you might be asked to pay a deposit. You must know all about hotel deposits before your vacation. This way, you can guarantee a satisfying and enjoyable trip without having to worry about losing your deposit at the end of your vacation.

Read more to find out why hotels charge a deposit, how you can pay for this, how this payment and refund works, and what should you do if your hotel security deposit is not refunded.

What is a hotel security deposit?

A hotel security deposit is exactly what its name suggests. It is usually an extra cost on top of your nightly room rate. A hotel security deposit protects the financial interests of the hotel like all other deposits protect the one charging this amount. But what exactly does a hotel security deposit cover?

1) Incidental and damage costs

The most common reason for hotels to charge a deposit is to cover any incidental and damage costs that might arise during your stay.

Say you have done damage to your room’s facilities or amenities or other parts of the hotel. One way to ensure their guests won’t leave without settling these damage costs is to ask them to pay a deposit. This way, hotels will know they are protected financially and guests will also be aware of the cost of causing damage to their rooms and the hotel and hopefully be discouraged to do so.

2) Rates of your first night

Apart from damage costs, a hotel security deposit may also cover the first night’s rate of your whole stay. This is usually connected to a hotel’s cancellation policy which is also implemented to protect the hotel’s financial interests.

Say it is an off-peak season, and a guest has just canceled a two-week stay at a property a day ahead of their arrival. The room is likely to stay empty for two weeks and the hotel will suffer loss. A hotel security deposit ensures the hotel will at least make some profit from a canceled stay. For this reason, many properties will have a cancellation fee, whether this is included in the hotel security deposit or not.

Be sure to check if your property of choice has such a policy so you can be more in charge of your finances when traveling.

3) Charges for extra amenities and services

Some properties may put charges for extra amenities and services in their hotel security deposit. This could be drinks or food ordered to the room via room service during your stay. Or the use of the minibar in the room. No matter what this may be, the hotel security deposit can guarantee that guests will pay for their use of any amenities and services they have used during their stay.

4) Resort fees

Some properties may have an extra charge labeled “resort fees” included in their hotel security deposit. This can cover everything from access to the hotel pool, the gym, the restaurants or cafes at a discounted rate, parking your vehicle, valet parking, etc. If you know you won’t be needing these services, feel free to ask the front desk if you can have these charges waived.

When will hotels charge you this security deposit?

It depends on the property you’re staying at and when they will charge you. So, be sure to ask the hotel for their preferred time of charging so you won’t be taken by surprise when they do ask for it.

1) At booking

One of the more common times when hotels charge for a security deposit is during booking. Most hotels will charge guests a security deposit when booking. This means you will input your card or other forms of payment details as you book online. A hotel security deposit will then be charged to this form of payment.

2) At Check In

Another common time for hotels to charge you for a security deposit is when you check-in. Hotels may accept everything from cash to checks, to debit and credit cards. But do be aware, properties from international hotel groups like Hilton, IHG, and Marriot are less likely to accept deposit payments in any form other than a credit card.

3) At Check Out

It is less common for hotels to ask guests to pay a deposit at check out. But it is entirely possible. If you want to be sure when you will be charged a security deposit by your hotel, be sure to ask when you book your trip. It is best to communicate directly with the hotel so you can get a clear answer.

When will you get your hotel security deposit refunded?

There is no standard as to when you will get your hotel security deposit refunded. But the time you will have to wait does link to your payment method.

1) If you paid by credit card

Paying your hotel security deposit by credit card does seem to be the fastest and safest option. This is because if there’s any dispute, you have physical parties to hold responsible: like your bank, or the hotel.

That being said, the processing of refunds does depend on two crucial factors: how fast the hotel staff can process your hotel security deposit refund, and how fast your bank can process the refund request made by the hotel for your security deposit.

2) If you paid by debit card

For debit card refunds, it is pretty much the same as for credit cards. But travelers did report a longer response time for debit card refunds.

Another downside to paying the hotel security deposit via a debit card is that actual money will have been taken from your account by the hotel. If you used a credit card, the hotel will usually only place a hold on your account. This means no actual money is taken out, and when the refund is processed, this hold will simply disappear from your account without moving your savings around.

3) If you paid by cash

This can sometimes be a quicker option than credit or debit card payments. Only because the hotel will unlikely use this amount elsewhere during the time of your stay.

For cash deposits, hotels usually require guests to hand in the requested amount in a sealed and signed envelope. They will keep this envelope sealed and untouched in a safe behind the check-in counter. When you check out, they will simply hand you back the envelope. And you can get your money back without any disputes or waiting.

4) If you paid by check

Check deposits are by far the longest form of payment for hotels to refund. So we won’t recommend you pay your hotel security deposit by check unless you can be flexible about your finances and can afford to wait for the refund. Or if you know your property of choice is used to handling check refunds on a quick turnaround time.

What should you do if your hotel security deposit is not refunded?

So, now that you know why hotels charge a security deposit, and what forms of payment may take longer to refund than others, what should you do if your hotel security deposit is not refunded after your trip?

1) Call your bank

If you notice your hotel security deposit has not been refunded, the first thing you should do is call your bank. This is to make sure of a few things.

One, that there is no error in the bank system, and that what you are seeing in your account is the latest information. Sometimes there can be a delay between your actual account and your online banking statement. Your bank will be able to clear this up for you.

Second, sometimes the late refund can be due to a system error in your bank’s processing software. This could be a wider issue that concerns more users of the bank than you. Once again, your bank will be able to tell you exactly what is going on with your refund.

Lastly, if your bank tells you they haven’t received any request from the hotel you stayed at to refund the deposit, that is when you should call the hotel to ask.

2) Call the hotel

It is always best to follow up with your hotel if there is no issue with your bank. It could be that the hotel is busy processing a large number of transactions. Say you’ve just returned from summer vacation, meaning peak tourist season, then yours won’t be the only refund they have to process.

It could also be that the hotel is short-staffed, so they’re a bit slow in processing guest refunds. Or it could be that somebody made a mistake in your refund process. It happens, we’re all human after all. But there’s no way to know for sure without after the hotel directly. So, this should be the next thing you do after checking in with your bank.