Was your mistake fare canceled? Here's everything you need to know

If you’re quick and flexible enough, you can occasionally score an unbelievable flight deal – known as a mistake or error fare – for the price of an iPad.

Just last week, TAP Air Portugal was offering business class flights to Europe for under $250 round-trip. Other mistake fares we've seen in recent years include Etihad Airways first class for $900, Cathay Pacific’s incredible round-trip business and first-class tickets starting at $700 and Hong Kong Airlines’ cheap business-class tickets to Asia.

So, imagine your disappointment when you get an email or phone call from the airline days or weeks later canceling your trip.

Since 2015, mistake fares have changed quite a bit. The airline is more likely to cancel an error fare than honor it – and they have the law behind them. That's exactly what happened with the recent TAP mistake fares. A number of TPG staffers and readers that booked this deal already received emails that their reservations have been canceled "due to an error in the system."

But it is possible to snag and keep an error fare, depending on the carrier. Here’s everything you need to know about mistake fares, and why it doesn’t always pay to book these cheap fares.

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What is a mistake fare?

Generally, mistake fares happen when airlines misprice the cost of a ticket. The “error” is then picked up by platforms like Google Flights and Online Travel Agencies (OTA) like Expedia. Etihad told Forbes that the 2014 mistake fare to Abu Dhabi, South Africa, Asia and more was the result of a “system filing issue.”

Unfortunately, there’s no definition of what a mistake fare entails nor how different a mistake fare should be from an airline’s normal pricing. Instead, the definition and burden is left up to each airline.

The Department of Transportation (DOT)’s Mistaken Fare Policy Statement provides a footnote after the requirement that an airline “demonstrates that the fare was a mistaken fare.” This footnote says:

The burden rests with the airline or seller of air transportation to prove to the Enforcement Office that an advertised fare and the resulting ticket sales constitutes a mistaken fare situation. If a sale does not qualify as a mistaken fare situation, the carrier or other seller of air transportation is bound by provision 399.88.

This means that the line between a mistake fare and a very good sale fare is fuzzy and potentially open to abuse by airlines that have second thoughts on a sale once bookings begin. To make matters worse, there’s no specified time window within which the airline must decide whether to cancel your ticket.

Related: DOT makes passenger-friendly changes to compensation, involuntary bumps and more

What isn’t a mistake fare?

Since the current DOT Mistaken Fare Policy Statement doesn’t provide any definition for mistake fares, it's impossible to define what isn’t a mistake fare.

However, airlines aren’t going to call every cheap fare a mistake fare simply due to the time required to cancel fares and notify customers as well as the bad publicity that comes with the cancellations. For example, on Delta’s canceled so-called mistake fares from New York JFK to Kenya and South Africa, readers reported that cancellation emails rolled in slowly across about 24 hours. The same is happening with TAP's recent mistake fares. Although many TPG staff and readers already received cancellation emails, not all that booked the deal did yet.

Although there’s currently no solid guidance on what is and isn’t a mistake fare, you generally shouldn't worry about a fare being canceled as a mistake unless the fare seems too good to be true. As a loose metric, a fare that’s more than 30-40% of what is common for that airline on that route usually won’t be considered a mistake fare. We've also been seeing some lower than usual fares as a result of the pandemic.

How to find mistake fares

The key to successfully booking a mistake fare is to be flexible with your dates and departure and arrival airports. Don’t let the mistake fare’s departure or arrival discourage you from booking your dream trip.

A few years back TPG's Victoria Walker found a fantastic error fare from New York (JFK) to Ho Chi Minh (SGN) on American and Japan Airlines. The only problem? she was based in Washington.

That didn’t deter her from booking, though. Instead, she booked a cheap Megabus ticket from D.C. to New York the morning before the flight and chilled out in the airport until her flight time. She didn’t stay in Vietnam, either. She used that flight to position ourselves to get to Kuala Lumpur (KUL) and still paid less than the cash ticket to Malaysia would have been.

Related: The best credit cards for booking flights

There are several channels devoted to spotting mistake fares, but one of the easiest ways to find them is through Google Flights or Skyscanner. You can’t book flights through the platform, so you’ll have to search for the cheap fares and then go to an OTA like Orbitz or Priceline to book the tickets.

Booking through an OTA might get you a cheaper fare, but that comes with a few complications, especially during the pandemic. Any changes, cancellations or refunds must be handled with the carrier directly. The OTAs follow the policies of their partners, which means that any credit, refund or change will be at the discretion of the airline. Then, there are some OTAs that "do not provide cash or credit card refunds under any circumstances."

It’s our job at TPG to bring you great travel deals, especially when it comes to airfare. However, we try to stray away from deals that might be mistake fares as they typically disappear quickly and may be canceled.

Related: Why you should think twice before booking with an obscure online travel agency

Should I make plans immediately?

The general understanding of mistake fares is that you should hold off on making immediate plans, such as booking hotels or rental cars, until your flight has been ticketed. We suggest avoiding non-refundable reservations until you’ve shored up your plans, and you know the airline intends to honor the ticket.

You can cancel a mistake fare ticket up to 24 hours after booking without penalty if you’re unsure about the dates or routes booked. There’s no guarantee that you’ll see that price again, so think carefully before canceling outright.

Will the airline honor the fare?

Before you book a mistake fare, know this: airlines do not have to honor so-called mistake fares. Specifically, the DOT ruling discussed above excuses airlines from honoring them if they can prove the tickets are indeed mistakes.

While canceled tickets often result in bad PR, many airlines are willing to risk unhappy passengers over potentially losing out on millions of dollars. In recent years, Lufthansa, Air France, Air New Zealand and Virgin Australia have all canceled mistake fares.

While several airlines chose not to honor mistake fares, other airlines did and scored great publicity for doing so.

What happens if the airline cancels my ticket?

Your first step when an airline cancels a mistake fare is to contact the airline’s customer service desk. Although it’s unlikely the airline will reinstate the ticket, they may offer some goodwill miles or a voucher toward a future booking.

If an airline cancels your ticket, they must refund you the purchase price you paid. For some mistake fares, getting your money back is as simple as calling the airline or waiting for an automatic statement credit. For others, getting your money back may require filing a dispute with your credit card.

More recently, Air France chose not to honor an unreal ~$500 mistake fare on La Premiere between Paris (CDG) and New York (JFK). However, the airline did offer passengers a downgrade to business class on that leg if they chose to keep the ticket.

Additionally, while we don't recommend making other plans right away, the airline should reimburse you any nonrefundable expenses that were made in reliance of the ticket purchase within a “reasonable period of time” once you’ve provided all necessary documents to the airline to justify the reimbursement. The Mistaken Fare Policy Statement clarifies:

These expenses include, but are not limited to, non-refundable hotel reservations, destination tour packages or activities, cancellation fees for non-refundable connecting air travel and visa or other international travel fees. The airline may ask the consumer requesting out-of-pocket expenses to provide evidence (i.e. receipts or proof of cancellations) of actual costs incurred by the consumer. In essence, the airline or seller of air transportation is required to make the consumer “whole” by restoring the consumer to the position he or she was in prior to the purchase of the mistaken fare.

Then, check your credit card statement frequently to ensure that the airline actually refunds you for the ticket price you paid and any non-refundable expenses. If they don’t refund you — or you believe the airline has canceled a ticket that wasn’t a mistake fare — you'll need to file a complaint with the DOT. Even if you book a mistake fare, you are entitled to a full refund if your flight is canceled — no matter the reason. Airlines may offer you a credit to use at a later date, or miles for future travel, but you are entitled to a refund.

Related: DOT again rebukes airlines over refunds amid ‘unprecedented’ spike in complaints

Bottom line

Scoring a mistake fare can feel like hitting the lottery. In many ways, it is like hitting the lottery, especially if the airline chooses to honor the ticket. But there are a lot of murky aspects, like booking through (sometimes) shady OTAs and refund hold-ups if the trip is canceled, which is why it doesn't always pay to book these cheap fares.

Booking a mistake fare is certainly a risk you’ll have to assess for yourself if the trip makes sense. But if the ticket is honored, it can save you thousands of dollars -- and potentially land you in some of the best premium cabins in the sky.

Reporting by Benji Stawski, Katie Genter and Victoria Walker.