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no no no... you don't have to pay for their rooms! you're just setting aside some rooms that your guests have the option to reserve. the hotel you pick, will set aside a certain number of rooms in a certain area of their hotel specifically for your guests at no extra cost! usually, all the rooms are on the same floor if possible.
This doesn't necessarily mean it will cost you anything. You can call around and find the best hotels (location to your venue, cost, extras) and reserve a block of rooms for your guests. If you reserve enough, many hotels will offer discounts for the guaranteed business. Have a rough idea of how many you may need so that the hotel can give you the most accurate estimate of cost (it can vary depending on the number). Also, make sure to ask about fees, such as: "Will there be a charge for holding them?" or " Will the discount/fee/cost change if not all the rooms set aside for your party are used?" Also, you may consider asking if the hotel does or will consider offering a shuttle for your guests to the venue. Once this has been decided, you can pass the information on to your guests with reminders to provide the hotel with the name of your party so that they receive the appropriate rooms/discounts. Hope this helps!
If you make traditional group reservations, you will have to give a credit card to hold the rooms. Sometimes the charge is $100 per room, sometimes there is a less costly flat fee. Make sure each guest checks in with a credit card, though, so you don't end up with any charges on your card. I'd say, make sure you know who will be needing a hotel rather than just "holding" a bunch of them.
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I have been hearing a lot about setting aside blocks of hotels for out of town guests for the wedding weekend. What exactly does this mean? Does this mean we would actually be paying for the hotel rooms? We will likely be having anywhere from 15-30 OOT guests (only a couple of which will be staying at our place). I'd like to, at the least, include information in the invites and/or on the wedding website about places that are convenient to stay. Do I need to go further than this and actually reserve rooms? I did not plan on paying for anyone's hotel room.