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I am from UK, I went to travel agent website and booked holiday (flights + hotel), today is the last day and my flight is 22:30. In the morning we went to the city to have some lunch and when we came back we were asked to pay for one extra day because hotel policy is to check out at 11:00 and our travel agency didn't book one extra day. I tried to explain to them that I didn't make booking directly and all should have been done between travel agency hotel and not me, but in the end just to get to my stuff that I have left in my room I paid for extra one day. I then called agency I have booked with, they said however that I should have booked for one more day If I wanted to stay till the evening (although I used their system to make the booking and didn't get explanation that I have to wait one day on the street), and if I want I should contact their complaints department.

Is this legal? What recourse could I take?

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This is not only completely legal, it's how all hotels work.

They have a published check-out time, which will vary between hotels but is usually somewhere between 10am and 1pm.

if you wish to stay longer, you need to request either a late checkout (which may be free, or may be charged, depending on a number of factors), or pay for an extra night.

In my experience, most travelers who have a 10:30pm flight will either request a late checkout, and/or they will simply check-out and leave their bags in storage at the hotel until later in the day. Of course that's not to say that there's anything wrong with booking an extra night, but it is not the norm, and is not what a travel booking website(!) would do by default.

For example, only a few days ago I had a 12:30am (ie, just after midnight) flight. My hotel was able to extend my check-out time until 4pm, after which I left my bags at the hotel and went shopping. I returned around 9pm, collected my bags, and headed to the airport - all for no extra charge!

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    Also note: Not all hotels will let you store your baggage in their facilities after you've checked out - that is either a service our a courtesy, not a norm or a required service of the hotel – Zibbobz Apr 11 '16 at 16:24
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    @reirab Many airlines do not permit checking bags more than 4 hours ahead of their scheduled departure. – MooseBoys Apr 11 '16 at 17:06
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    @Zibbobz: while luggage storage is indeed considered a courtesy service not a requirement, as you say, it is an extremely common one — I have never known a hotel to refuse it (from pretty extensive travelling in the US and Europe, and some in other parts of the world), so I’d say it is pretty safe to assume it will be available. – PLL Apr 11 '16 at 17:10
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    @Zibbobz I've been all around Europe, North America and Asia and I could store my luggage every time without any hassle (and that ranging from hostels to expensive hotels). Where are you travelling that this is not considered the norm? Would be good to know to plan ahead if I'm ever in that area. – Voo Apr 11 '16 at 17:30
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    @JoeBlow huh? I've never got charged for it in hotels in range from cheapest ones to glamour expensive ones in Europe and US. – rvs Apr 11 '16 at 20:42
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This is perfectly normal. Checkout times at hotels are usually between 10:00 and 12:00 and you need to pay something extra (sometimes for the next night, sometimes less - depending on hotel rules) for overstaying.

Most hotels offer their guests to leave their luggage for free for the rest of the day. So in this case I would check-out of the hotel in the morning, leave my luggage with the reception and then go out to enjoy the rest of the day.

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    As for why this is normal - the hotel needs leaving guests to vacate the rooms with enough time for them to be cleaned for incoming guests to arrive in the afternoon/evening. They need your stuff out of the room for this to happen, so they may offer late checkout and store your stuff. If you just leave it and don't check out, this is extra hassle for them - if they even have your room available to keep another night, based on bookings. – GalacticCowboy Apr 11 '16 at 20:12
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Short answer, to echo the other answers: it's entirely legal. Checkout time is checkout time, typically anywhere from 9am - 1pm (0900 - 1300). Depending on the situation, you may be able to extend this to within an hour or so of check-in time (typically 3pm), and a late checkout may or may be free. Factors which affect the situation include: what the arrival situation looks like for the next night (if it's a hotel that does a good business with weddings, a late checkout on a Saturday will generally be a minor miracle: wedding groups mean lots of early check-ins or at least attempts at such), membership level in the hotel's loyalty/rewards program, how much of a regular history you have with the hotel (4 one-night stays (especially if regularly spaced, e.g. every three months, as might be the case for a traveling salesman) generally count more for this than a single 14 night stay: the hotel will figure that you'll be coming back), the ratio of guests who have checked out already to guests with late checkouts, and how you made your reservation (in approximate order: directly with the hotel, through the hotel chain's website, through a credit card issuer's travel agency, and then basically everything else). If all else fails, a large tip for the front desk agent may get you a late checkout (in my earlier life behind a hotel front desk, for my rare morning shifts (I mostly worked night audit), I could most days get away with a total of 2 hours worth of discretionary late checkouts without getting yelled at by management or the housekeepers; a "$100 handshake" could reliably get one an extra hour).

None of this is any good for your situation: the best case for a late checkout is 3pm, hours less than you need. All is not lost, though. Depending on the hotel, there's a thing called "day use" or "zero night stay". If you happen to choose a hotel where the hotel figures they're able to flip the room and sell it again for the night, this may not be that expensive. The staffing practices of the hotel and their demand pattern are what govern day use availability. Generally, the more full-service the hotel is, the more likely they will have someone around in the evening to flip a room. If they're close to an airport or in the downtown of a major city, they're likely to be able to have someone walk in later wanting a room. On the other hand, limited service properties (e.g. motels), tend to have no one working at night besides the front-desk agent, so day use isn't an option (most hotel software will not allow a reservation for day use, by the way: generally the only way to do day use is to walk in or do it as an extension of the stay).

Beyond day use, most hotels will be willing to store your luggage etc. for a few hours, though it's best to bring up the possibility when you check-in. Factors which affect this are similar to those affecting whether you can get a late checkout, but you have a far greater chance of success.

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TL;DR; Hotel was right (I was wrong) - to pay for one extra day was most appropriate solution.

As an addition to the above answers there is a long discussion in comments around was it legal to keep my belongings (this is what I was looking for).

In one of comments @piet.t refers to the hotelkeepers liens article.

Hotelkeeper’s liens allow a hotelkeeper to hold personal property that a guest brought with them into the hotel, as security for payment. Such liens are also known as “innkeeper’s liens”. Hotelkeeper’s liens usually apply only to the “baggage” of a person, and not their automobiles.

In Spanish (Canary Islands belong to Spain) it is called gravamen de hotelero

So it was perfectly legal to keep my belongings until I pay for the loss of the room for the day.

My personal advice - do not use online websites to book your holiday, go to travel agency in person, additional cost is usually worth the issues avoided. If something goes wrong I am sure they will be more helpful than phone operator (if they don't they know that day after holiday ends you will be walking through their office door and talking to their manager ;) )

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    although in this case I don't think it mattered whether it was booked online or with a travel agent - since it is usually customary for travelers to not book the extra night, and they usually just wander around the city with the bags checked after the morning checkout. What time did you check out by the way? – MonkeyBonkey Apr 16 '16 at 12:59
  • @MonkeyBonkey 20:00 – Matas Vaitkevicius Apr 16 '16 at 13:42
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    Even an in-person travel agent isn't going to assume you want to pay for an extra night in the hotel just to store your luggage and most aren't going to offer to book an extra night just because your flight leaves in the evening. A travel agent does give you someone to ask these sorts of questions though, so that's helpful. – Zach Lipton Apr 16 '16 at 18:47
  • @MatasVaitkevicius yeah 20:00 is very late... most hotels might give you some leeway in the early afternoon but evening time would be too late.. – MonkeyBonkey Apr 16 '16 at 21:01
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There is one thing missing from the other answers:

In every hotel I ever stayed in (in total about 50), they tell you in person what the check out time is while you check in. They tell you even if you don't ask. If you book through a website or a travel agency doesn't matter, the one telling you about checkout times is the person who checks you in at the hotel. If they tell you something and you don't understand what they mean, ask them what they mean, because it might be important.

In cheaper hotels you can usually check out up to 1 hour later than the checkout time without any problems, but the more expensive the hotel the more likely there will be an extra charge.

If you realize that the stated checkout time won't work for you, you need to let the hotel know in advance. They will always be able to find a reasonable solution, be it a late checkout, storing your luggage for you, or something else - they might even allow you to keep the room at no charge, as long as you're gone the next morning. But the prerequisite is that you tell them first. By occupying a room without booking it, you are one of the bad guests, and they have no reason to be nice to you.

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    In my experience, hotels don't always tell you the check out time when you check in. Some do, and sometimes I'll ask about it when it matters for my itinerary, but others do not. Sometimes that information is included with your key or posted on the back of the hotel room door. – Zach Lipton Apr 16 '16 at 18:45

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