When you are on vacation in a tropical paradise or a fancy resort, it’s tempting to try and find a way to stay there longer. Most of us don’t have the financial means to purchase vacation real estate though. The timeshare industry tempts us with the dream of that vacation home at what looks like a more affordable price.
But just as we think we may have a solution for vacation ownership, we hear the horror stories that come along with timeshares. Annual fees that cost hundreds of dollars per year and are always rising. Special fees assessed by the resort for occasional maintenance projects. Even a second mortgage.
And if you decide that the costs of owning a timeshare are too great, you’ll find that selling your timeshare is also a challenge. The resale market is notoriously stuffed with unhappy timeshare owners, desperate to stop paying annual fees and unload the dream vacation home they thought they’d wanted a few years ago.
All the costs and difficulties that come with a timeshare are red flags to be sure. And, having seen those red flags, you’d be right to question whether timeshares in general are just scams. That’s not really the case — some timeshare owners are happy with their purchases.
That doesn’t change the fact that the world of timeshares is filled with scams ready to ensnare those who haven’t done their homework. This article will examine the various scams and traps awaiting the unwary who enter the timeshare market. And, if you have fallen prey to a scam or just need to get out, we’ll explore your options.
Maybe you’ve heard that 85% of timeshare owners regret their purchase and wonder how on earth so many people could make a decision they regret. For many, the answer lies in the timeshare presentation: a high-pressure sales pitch made to vacationers when they are at their most vulnerable.
While high-pressure sales pitches by a timeshare resort company aren’t illegal, some companies’ practices for closing sales are questionable. Timeshare presentations usually begin with the promise of free stuff — dinners, show tickets, or vacation activities — in exchange for you sitting through a presentation.
Sounds simple enough, right? The actual experience is more harrowing than this description would lead you to believe. A presentation that was promised to last 90 minutes can extend for hours as several different sales people visit you and your spouse, trying to convince you to buy a timeshare. And of course, you can’t get that free stuff until you’ve endured the entire presentation.
The whole time, your salespeople can be engaging in all sorts of questionable behavior: trying to get you to close before you are ready, glossing over the fine print of timeshare contracts, or failing to mention that those annual fees will almost certainly grow every year. They may even try psychological tactics against you, like driving a wedge between you and your spouse.
Practices like this have led many states to require that timeshare companies give customers a rescission period after signing the contract — if you change your mind or decide that you don’t like how you were treated, you can cancel the contract.
The length of the period depends on your state, however, so be careful that you don’t miss your cancellation deadline.
Timeshares are expensive. While they may not cost as much per year as a full-fledged vacation home, you could literally be paying for them forever. There are lots of costs of timeshare ownership, and not all of them are clear from the beginning. Even if those fees aren’t technically a scam, they should make you think twice about a timeshare purchase.
All timeshares come with the gift that keeps on giving: annual maintenance fees and other resort expenses. In even the most conservative case, you will spend hundreds of dollars per year on fees. Those fees are in addition to any payments on a mortgage you took out in order to purchase your timeshare.
And the fees don’t end there. Let’s say you buy a timeshare in Orlando, Florida, and you want to trade your time there for time at another property in Hawaii. Though the sales pitch might have made the process sound easy and inexpensive, it’s often anything but.
Expect additional fees to trade from your home resort to the one you actually want to visit. There may be a premium on the resort you want, as it will likely be a more popular (read: crowded) destination than the one you are used to. You’ll also pay in terms of time and frustration, as you may not be able to get the same time in Hawaii that you can get in Florida.
Do these fees mean that a timeshare purchase is a scam? No. But it doesn’t make a great deal of sense to pay them, particularly when many timeshare resorts rent their unused inventory of units to customers who end up paying less for their rentals than they would for the basic maintenance fee. By owning, you’re getting charged more for the exact same product.
The steady stream of fees and restrictions that accompany timeshare ownership will keep accumulating over time. The constant nickel-and-diming can condemn your vacation plans to a slow, painful death.
Let’s say misleading sales practices and hidden fees have you fed up with your timeshare, and now you want to get rid of it. Here, too, you’ll have problems. There are many timeshare exit companies in the business, and many have been accused of running scams. An encounter with these scammers can compound the already costly mistake of buying a timeshare.
The company known as Timeshare Exit Team has had several problems with its customers, as detailed on the Better Business Bureau (BBB) website. The Washington Attorney General’s office has even filed a lawsuit against the company for its business practices, which allegedly include taking large sums of money upfront and failing to follow through for its clients.
Even selling your timeshare can be risky. Several companies scam owners desperate to unload their timeshares by promising they have willing buyers lining up to snap up timeshare units. All they need — they’ll tell you — is a listing fee.
In legitimate real estate transfers, the real estate broker will get paid after the sale through escrow — not take a listing fee. These scams have been recognized by state Attorneys General (including Florida and California) and the Federal Trade Commission (FTC).
Often, these buyers are fabricated, and the timeshare resale company is looking to grab your cash. The supposed buyers vanish, and the company comes back to you explaining how you just need to accept less money. Oh, and you have to pay them more in listing fees.
But what is the alternative, you ask? There are ethical companies that can help you. As one of those companies — with unparalleled experience and an excellent BBB rating — Centerstone Group can help you put your painful timeshare experience in the rearview mirror.
Our proprietary three-pronged approach will pursue a pressure campaign against the developer in addition to other time-tested legal and transfer strategies. We realize the process can take a while and are committed to doing it correctly. As soon as possible, we will start transferring timeshare obligations to a receiver while we work on your timeshare exit.
No product is for everybody. People with the wealth and inclination to continuously spend money on a fractional interest in vacation property may be happy with their timeshares. Those of us who are watching our spending or want more control over our vacations may not be as amenable to the experience.
Whatever decision you make, though, you deserve to make it with eyes open — knowing exactly what you are getting yourself into. Unfortunately, with timeshares, this is often not the case. If you find yourself in this situation, don’t despair. Contact Centerstone Group today for a free consultation, and let us see how we can help you.