Think carefully before you cancel, particularly if your exchange partner has already booked their trip as a cancellation can cause financial loss and upset for the other person. If there is anything you can do to stay at a friend's place so that their exchange can still go ahead, it is better than cancelling. If you absolutely must cancel, tell the other party as early as you can and try to help them find alternative accommodation, particularly if you have local friends who are exchangers or if you can help in some other way.