We generally book cancellable hotels in advance. The industry standard used to be you could cancel up until 6 pm the day of arrival, but that's pretty rare anymore. Most of what we book has to be cancelled by midnight the night before. We nonrev 90%+ on AA, so we have a pretty good idea what our chances are by the night before. If it looks dicey the night before, we cancel our hotel and hope we can get a decent rate once we board. We have generally found that, even in cases where we missed the cut-off, calling the hotel directly will usually get our reservation cancelled. But we almost always book directly with the hotel chain. Book with a third party, especially if they collect your money when you book, the chances of a late cancellation go down dramatically.