Is It Worth It To Book An Advance Purchase Rate At A Hotel?

We’ve booked our fair share of hotels over the years and always have to decide if we want to reserve the advance purchase rate or the best refundable rate. Hotels offer a lower price if you’re willing to pay for the entire stay upfront but is it worth the savings to pay for your stay in advance?

Unlike having to pay for your train, plane or cruise ship ticket ahead of time, you’re able to pay for other travel expenses, like a hotel room, when you’re finished with your stay. It didn’t take long for hotel companies to figure out that people weren’t showing up for their reservations so hotels now give an incentive to pay ahead of time for your room, in the form of a lower price.

Let’s look at an example and see if it’s worth the cost savings to pre-pay for a hotel room…

I’m currently checking prices for our yearly (or now twice yearly) trip to Schlitterbahn in New Braunfels, TX. I’m planning on staying at our usual Candlewood Suites.

Candlewood Suites New Braunfels

Looking at the average price per night, the Advance purchase rate is $96.25 and the Flexible Rate is $106.50. That’s $10.25 a night more, or $42 for our four-night stay.

For the “Flexible” rate, there’s no deposit required. Clicking on the rate details, I see the cancellation policy:

Canceling your reservation before 6:00 PM (local hotel time) on the day before your check-in date will result in no charge. Canceling your reservation after 6:00 PM (local hotel time) on the day before your check-in date, or failing to show, will result in a charge equal to the first night’s stay per room to your credit card. Taxes may apply. Failing to call or show before check-out time after the first night of a reservation will result in cancellation of the remainder of your reservation.

For the “Advance Purchase” rate, there’s a deposit required. You need to click on Rate Details to see what the deposit is:

A deposit for the entire stay is due at time of booking.

Here’s the cancellation policy for the Advance Booking rate:

Canceling your reservation or failing to arrive will result in forfeiture of your deposit. Taxes may apply.

There’s a catch (as usually exists when you’re getting something for less), and in this case, it was that the reservation is non-refundable. If for any reason you’re unable to make the trip, you lose all the money you’ve paid. {sad trombone}

You have to decide if you’re willing to risk losing $435 if you need to cancel, in order to save $0 on your vacation. Remember, I’m looking for a vacation over six months away. Lots of things can change in six months.

For me, I try to never book a non-refundable advance purchase rate. I’m not willing to risk the money just to save a few dollars. That’s why I’m not a gambler (and why we only visit Las Vegas for the shows and not the casinos).

Now I’m not a risk-taker but I am still looking to save a buck wherever I can. Thankfully, there’s a way for me to have my cake and eat it too. There’s a AAA rate that’s the same price as the Advance Purchase rate. Remember that AAA is worth more than just road service.

Note that there’s no deposit required for the AAA rate. Here’s the cancellation policy:

Canceling your reservation before 6:00 PM (local hotel time) the day before your check-in date will result in no charge. Canceling your reservation after 6:00 PM (local hotel time) on the day before your check-in date, or failing to show, will result in a charge equal to the first night’s stay per room to your credit card. Taxes may apply. Failing to call or show before check-out time after the first night of a reservation will result in cancellation of the remainder of your reservation.

That’s the same policy as the Flexible rate with the price of the Advance Purchase rate. The best of both worlds. Winner!!!!!

Now, there are cases where I may book an advance purchase rate. If I read the policies and I’m able to cancel the room up until a few days before the stay and get a refund, I’ll consider paying in advance if the price is right. I’m also more willing to pay in advance the closer I am to the day of the stay. If I’m booking a room only a day or two in advance, I might be within the cancellation policy anyway so why not save a few bucks.

I just don’t see many times where it’s worth it to book a hotel room where you need to pay the entire amount in advance and lose the entire amount if you need to change your plans. I’ve never seen the prices be more than $10-$20 a night cheaper for the refundable rate and that’s not a price I’m willing to pay to save a few bucks on a room.

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This post first appeared on Your Mileage May Vary

2 thoughts on “Is It Worth It To Book An Advance Purchase Rate At A Hotel?”

  1. I book the nonrefundable rate if there is something I want from the hotel, such as an airport shuttle. Hotels do sell out (especially more reasonably priced ones), and if there is one in a location I really want, I will go with prepaid rates. Also, the no penalty cancellation windows for most hotels have really shrunken. If you fly Frontier, Spirit, or Allegiant, get a reservation with the longest cancellation period.

  2. This is clearly a “YMMV” hot take. There are trips where you’re booking less than 30 days out, and the advanced booking rate is $10-15/night cheaper. Say the room is $100 and the trip is 3 days, why wouldn’t you take the advanced pre-paid rate at 10% less and save $30?

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