Refundable Damage Deposit

This feature allows Hostaway users to hold, and capture if needed, a certain amount from guest credit cards during the reservation process as means to set up refundable damage deposits or security deposits.

Authorization hold (also card authorization, pre-authorization, or pre-auth) is a service offered by credit and debit card providers whereby the provider puts a hold of the amount approved by the cardholder, reducing the balance of available funds until the merchant completes the transaction (capture) or cancels it, or the hold expires

Important notes:

• This feature is only available for Stripe-connected accounts and Authorize.net. Braintree is not supported
• For Stripe: A pre-auth expires after 7 days of the pre-auth creation. This timeframe is set by Stripe
  For Authorize.net - A pre-auth expires after 30 days of the pre-auth creation. This timeframe is set by Authorize.net
• The above mentioned time frame cannot be changed from Hostaway. Once the pre-auth expires, the amount held will be released and the guest will have that amount available on their credit/debit card again.
• Currently captured funds are not reported in Financial Reporting.
• Currently captured amounts are not reported in Reservation Financial Breakdown.
• At this time Pre-Auths can only be created through Auto Invoices and Auto Charges. They cannot be created manually.
• Pre-Auths can be created through Auto Charges without the need of creating an auto-charge.

Learn more with the Pre-Authorisation FAQ

How to Create an automated Pre-Auth

1. First setup the refundable damage deposit value in the listing 

Go to Listing > Select the listing > Click on Edit > Go to Prices and Fees > In refundable damage deposit fee > Add the value & Click on the setting icon next to the value to Exclude the damage deposit from the total reservation sum because, by default, the checkbox is unselected.

2. Create an Auto Pre auth invoice

Go to Dashboard > Guest Invoicing > Auto Invoice > Click on Add

Fill in the relevant fields > Add the title / Select the currency > Select the channel > Select the relevant listings for this specific auto pre-auth > If you wish to add a new listing automatically make sure to select the check box

Important Note when selecting the listing: If you have different damage deposit values for specific listings make sure to create separate auto pre-authorization to capture the damage deposits.

Add the invoice - Add the Title > Add the Flat Fee value which you have entered in the listing level for the above-selected listings

Add Charges - Click on Add item >  Select the Pre Authorisation > Add the Title > Add the Same Flat Fee value which you have entered above > Schedule the charge accordingly > Save it


Suggestion on Event Trigger: 

For Stripe A pre-auth expires after 7 days of the pre-auth creation, so create the invoice before X days or X Hours before the checkout

For Authorize.net A pre-auth expires after 30 days of the pre-auth creation, so create the invoice before X days or X Hours before the checkout

How to Capture Fully or Partially the Damage Deposit

Go to Guest Invoicing > Go to Charges > Select the relevant hold success > Click on the three dots and click on “Capture now” > Pop up will appear > Enter the amount > Click on Update

OR
Go to Specific Reservations > Go to invoices and Charges > Go to Pre-auths > Click on the three dots and click on “Capture now” > Pop up will appear > Enter the amount > Click on Update

Capturing can only happen once. If a partial capture is done, Stripe will immediately refund the rest of the held amount to the guest’s credit card. This is a behavior of Stripe and cannot be changed

Or you can capture via Stripe also 

Once the hold is a success >  Go to Stripe > search for the guest > and capture the required amount, Once the amount is captured  Stripe will immediately refund the rest of the held amount to the guest’s credit card.

Workaround to capture the Damage deposit if the auto pre-auth was not Setup or its not captured

If the credit card details are available in Hostaway > Go to Stripe to create a pre-auth because Hostaway does not allow creating manual pre-auths (only automated ones, If you charge it manually when you try to refund, you will be charged a commission on the refund) this is not possible.

You can do this, however, directly in Stripe by searching for the customer and creating a payment only as pre-auth:



If the guest's credit card is not available please send the Guest portal link to collect the credit card details - For more information on Guest Portal > once the Credit card details updated > Please navigate to Stripe >create a pre auth via Stripe