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We need a place (that/where) we can stay for a few days.

Might I trouble you to tell me whether 'that' is also possible in the question? I think 'where' alone is correct because 'stay' is an intransitive verb. 'Where' can be paraphrased into 'in which', but 'that' is just 'that'.

We need a place in which we can stay for a few days. (O)

We need a place that we can stay for a few days. (?)

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The verb "stay" is not normally transitive:

I stayed at the hotel (Okay)
I stayed the hotel (very odd)

Similarly you should not say

A place that I can stay (odd)

This would make "stay" a transitive verb.

Instead, you use "where", or "in which". (Don't worry too much about restrictive and non-restrictive clauses, or if you do worry about it, you should know it is about intonation, not word choice)

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