I have written several times regarding the risk versus the benefit of pre-paying hotel reservations. Most recently it was a post last March regarding the additional small discount you receive when you pre-pay but as a general rule, it does not make good financial sense to pay $100's if not 1,000's of dollars up front for an agency or hotel to use for months ahead of your arrival.
Here is yet another reason to think twice about pre payment for hotels. This sad story was printed by USA Today out of Hawaii about a Canadian couple who lost their pre-paid vacation because the hotel went under. As opposed to Third Party travel sites (which would re-book you somewhere else), there is no recourse when your chosen hotel goes bankrupt. With the elevated number of loan defaults and bank foreclosures lately, there is a greater chance of this happening than any time since the Great Depression.
IN my opinion, if you are pre-paying one night only, it might be OK to risk losing your money. But for this couple having paid for a MONTH? And now losing it all?
Not worth the risk in my opinion. But if you DO decide to take such a rosk, I always suggest you consider travel insurance and make sure your policy covers bankrupt hotels, etc.
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