Last Monday, a TPG reader arrived in Toronto, expecting to spend the next four days at a cute boutique hotel, The Slate, in the Entertainment District. But when she arrived at the property, which was operated by Sonder, she was shocked to be greeted by locked doors — and an eviction notice.
The notice announced that Sonder had repeatedly failed to pay the rent on the building.
As a result, the leasing company obtained a court-ordered eviction (a Landlord’s Warrant), and on Nov. 9, 2026, a process server delivered the notice to the hotel.
“Your lease has been terminated effective immediately,” the eviction order advised.
Everyone at the Sonder property, including staff and guests, was legally forced to vacate immediately.
By the time this reader arrived the next day, the hotel was already shuttered — having been repossessed by the building’s owner. That left her on the street in a foreign city with business meetings to attend and no place to stay.
Related: Sonder to file bankruptcy
A hotel eviction scene on repeat
Unfortunately for thousands of Sonder customers, similar scenes repeated again and again this week.
All around the world, Sonder guests were unceremoniously told to grab their things and go. Misinformation about what caused the abrupt closure and who was responsible for the mass hotel evictions spread.
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TPG has been fielding many complaints from displaced Sonder guests, many of whom are angry Marriott Bonvoy members wondering why they weren’t given more advance notice of the impending bankruptcy.
But how much advance notice did Marriott have that Sonder, an independent company, was going belly-up? And what can the displaced travelers do to secure their refunds and find alternative accommodations now?
That’s what TPG aimed to find out.
Here’s what we learned and what you need to know if you are caught up in this bankruptcy mess.
Licensing agreements and surprise bankruptcies
Emotional headlines in the media this week have falsely claimed that Marriott was behind the sudden evictions. Many reports incorrectly assumed that because Marriott terminated its licensing agreement with Sonder, that the separation caused the bankruptcy.
But the reality is that the bankruptcy caused the separation.
Sonder was a company running on fumes for some time, leaving a trail of unpaid bills in its wake.
In a phone interview with a Marriott spokesperson this week, TPG learned that on Sunday, Nov. 9, Sonder informed Marriott that it was “filing for bankruptcy and shutting down.” For obvious reasons, the licensing agreement between the two companies terminated that day.
“Marriott terminated its license agreement with Sonder because Sonder informed us they were headed imminently for Chapter 7 bankruptcy, with no plans to continue operating,” the Marriott spokesperson shared with TPG. “As a result, Marriott felt it had no choice but to terminate the agreement, which would facilitate communication with Sonder’s guests, whose safety, security and welfare would be impacted by Sonder’s sudden liquidation.”
Marriott immediately began contacting its customers who were currently in residence at Sonder properties. The message informed the guests that Marriott’s association with Sonder was over and that the separation made continuing their stay impossible.
This message gave many Marriott Bonvoy members the incorrect impression that Marriott had made a unilateral and sudden decision to terminate the agreement, something that could have been planned in advance to avoid impacting customers.
But the truth was that Sonder was being kicked out of the buildings it did not own. The “imminent” bankruptcy filing and subsequent shuttering of the business happened just one day after Sonder informed Marriott that the company was ceasing operations.
On Monday, all the employees were fired and the leased buildings abandoned — and the Sonder guests (many of whom are TPG readers) were left scrambling to find replacement accommodations.
What to do if you are currently displaced because of Sonder’s shutdown
It’s a bit unclear if any Sonder properties are still open. But if you happen to still be in one, it’s definitely time to pack your bags and leave.
Our Marriott executive contact told us that the Marriott Bonvoy team is working around the clock to assist impacted travelers in finding alternative accommodations. Unfortunately, though, stranded guests are reporting long wait times to speak to Marriott customer service (1-888-236-2427) and assistance that does not necessarily or consistently include discounted replacement hotels to match the original Sonder reservation rates.
One TPG reader — who has been, until now, a lifetime Platinum Elite member — emailed us and shared that she was in the middle of a stay at a Sonder property in Madrid when she received a notice informing her that she had to leave immediately. She had booked her stay through the Marriott booking portal. One email she received from Marriott stated that the company would offer “immediate support to help secure alternative accommodations at another Marriott property at your original booked rate, subject to availability.” But when she got on the phone with Marriott, the representative told her that email was incorrect, and she could not be rebooked at another Marriott property at her original booking rate — instead, she was rebooked with a higher rate at a hotel an hour away.
So if you are one of those displaced travelers, you may want to look outside the Marriott ecosystem for an immediate re-accommodation in the price range of your original reservation.
Landing, a company that offers short-term furnished apartments around the United States, for example, is currently offering displaced Sonder customers a $500 discount.
Keep all your receipts, though, because these are early days in this situation. You’ll want to have a thorough record of just how much this fiasco cost you, should there be financial compensation available in the future.
What to do if you have an upcoming prepaid Sonder reservationÂ
Travelers who have prepaid upcoming reservations at a Sonder property should immediately make alternative plans. Your stay is canceled.
Because Sonder filed for bankruptcy, it is unlikely that customers will automatically receive a refund for their canceled stay. When a company files for bankruptcy protection, it is, at least temporarily, relieved of financial obligations, like providing refunds to customers.
And this is where it becomes a little murky for Bonvoy members who booked their Sonder reservations through the Marriott app or website.
Sonder is the merchant of record on those reservations and that is the company that owes the refunds. Since Sonder is bankrupt and won’t be voluntarily processing those refunds, guests must file a credit card dispute now.
The Fair Credit Billing Act (FCBA) provides the protection to ensure that all Sonder customers who prepaid for a reservation using a credit card will receive their money back. Those refunds can’t be processed by Marriott because the prepaid cash is with Sonder (who is bankrupt) and will be included in the overall debt of the company in the bankruptcy proceedings.
The FCBA allows consumers to charge back fees to a merchant that does not (or cannot) provide the goods or services as agreed. So if you have a prepaid Sonder reservation, do not hesitate to file a credit card dispute. That is how you will get your money back.
What about additional losses incurred as a result of Sonder shutting down?Â
Many readers with upcoming trips that include a now-canceled Sonder reservation are asking about the additional losses they’ll incur if they abort their plans completely.
The answer to that question depends on whether the consumer has purchased travel insurance, and if so, what kind of policy it is. Nearly all travel insurance policies provide “named perils” coverage. That means only certain events specifically outlined in the document are covered.
What you’ll want to look for in your policy is coverage for the insolvency, with or without bankruptcy, of your travel provider. If you have that protection, you’ll be able to file a claim for any nonrefundable parts of your trip should you decide to cancel.
But keep in mind, double-dipping isn’t legal — so you would not include the cost of the canceled Sonder reservation, which you will get back through a credit card dispute. Things like prepaid, nonrefundable airfare, train, car rental or excursion tickets should be covered if you have that insolvency protection in your policy.
Unfortunately, though, many travel insurance policies actually name the default of a travel provider as an exclusion for coverage. In that case, travel insurance would not provide protection in this situation.
Travel insurance can be confusing and complicated, leading insured consumers to make costly mistakes. But every major travel insurance company provides its customers a 24-hour hotline. Before you make any decision about your upcoming trip, dial that number and ask what your policy covers.
Related: The best travel insurance policies and providers
What about credit card travel protection?
Similar to comprehensive travel insurance policies, the travel protection included with your premium credit cards cover only named perils.
The travel protection provided by credit card companies, unfortunately, excludes bankruptcy of a travel provider as a named peril.
I spoke to our Chase executive contact this week who explained the following: “Chase’s travel insurance does cover where lodging has become uninhabitable (see below the bullet from our T&C’s). However, it would not cover lodging becoming unavailable due to the insolvency of a travel provider.”
- Covered Traveler’s or their Traveling Companion’s Provider of Lodging listed on the itinerary and/or Host at Destination location being made uninhabitable.” (Chase spokesperson)
Based on this explanation, Sonder’s sudden closure would not be a covered event, unfortunately.
However, those same credit cards should facilitate the return of the prepaid funds paid to Sonder for guests’ original booking through the chargeback process.
Am I guaranteed new accommodations because of Marriott elite status?
Although many Marriott Bonvoy members have been asking whether there are special guarantees for members with elite status, unfortunately there is no standard answer, according to the Marriott spokesperson TPG spoke with. Each member’s situation is being reviewed and handled individually.
Based on the many reader emails we’ve received — many of whom have elite status with Marriott — status will not necessarily help you get rebooked, nor does it guarantee any discounted rates or points offerings. From the shared paper trails that TPG is receiving we know that, some displaced Marriott customers are being provided with a small amount Marriott Bonvoy points as a goodwill gesture. Others are being offered replacement accommodations. Some have received up to 40,000 Bonvoy points, which according to TPG’s latest valuation is equivalent to about $280.
Without much consistency, though, it’s understandable that many Marriott loyalists feel frustrated about how the situation has been handled.
Bottom line
If you’ve been impacted by the Sonder bankruptcy:
- Review the “Sonder FAQs” on the Marriott Bonvoy site
- File a credit card dispute to get your refund as soon as possible
- Keep additional expense receipts for possible future compensation
- Check your travel insurance policy for additional protections
Lastly, although Marriott is not taking on the debts of the bankrupt Sonder, that doesn’t mean Marriott members should be afraid to ask for a goodwill gesture from the company.
And here’s one more tip: As a consumer advocate who has successfully mediated thousands of problems over the years, I know that companies are much more willing to provide points or miles than cash compensation. This is especially true when the company is not legally responsible for the situation. So keep that in mind when you make your request. Some Marriott Bonvoy customers have already done just that and received requested points.
If you find yourself in a battle with a hotel, cruise line, credit card company, car rental agency or vacation rental company send your request for help to ombudsman@thepointsguy.com and I’ll be happy to investigate and help you if I can.
