Things You Might Not Know About Timeshare Maintenance Fees

timeshare maintenance fees: stressed woman looking at a pile of paperwork

Nobody buys a timeshare because they want to pay more money for their vacation. The idea is to get consistently great vacations every year for the least money possible. You should be getting a deal! Unfortunately, it doesn’t usually turn out that way. 

According to a study by the University of Central Florida, 85% of timeshare buyers regret buying. They are searching for a way to cancel their contracts or sell their units. Often, they find that these things are easier said than done. But these desperate measures raise the question: Why are so many owners trying to escape their timeshares?

The answers are many and complex, but a common refrain has to do with annual timeshare maintenance fees. According to a 2019 report by the American Resort Development Association (ARDA), the average annual maintenance fees for a timeshare unit came to $1,000. 

Even ARDA states that these fees can go up 2% each year. The ugly truth, however, is that they can increase even faster than that. So, it’s not surprising that these fees are often the straw that breaks many an owner’s back, financially speaking. This article will take a look at these timeshare maintenance fees. Specifically, we’ll examine:

  • What annual maintenance fees cover: For the amount of money you’re paying, it might surprise you to know what is and isn’t included.
  • How and when the fees can go up: It’s different between companies and types of purchases, but it’s always going to be expensive.
  • The consequences of failing to pay your fees: These timeshare developers work so hard to get you to purchase because they depend on your money to run their business. If you stop paying, you can be sure there’ll be trouble.

What Do Timeshare Maintenance Fees Cover?

person cleaning a pool

Because they are such a big part of the timeshare ownership experience, you may find yourself asking what annual maintenance fees actually do. At first blush, the answer seems pretty basic. They keep timeshare resorts running.

A resort is expensive to run. They have to employ cleaners and janitorial staff. Common areas and restaurants need furnishing, air conditioning, and routine repairs and management. Landscaping is another constant need. And, any resort worth its cost will have plenty of amenities, like swimming pools, fitness centers, and saunas.

All of these amenities come with high costs. Even simple maintenance and repairs for a swimming pool can cost thousands of dollars. Annual fees charged to timeshare owners pay for these costs and make the extravagant resort experience possible. 

Also keep in mind that these annual fees also pay for the people who manage the resort and all its features. In most cases, guess who the management company is? It’s the same developer that sold you the timeshare in the first place. Therefore, a large part of timeshare maintenance fees consist of money you pay the resort to manage itself.

All those regular fees can be a tough pill to swallow, but we’re not done yet. There is another hidden cost.

Perhaps the most interesting part of these regular vacation ownership fees is the costs they do not cover. The term special assessment fee is one that people governed by homeowners’ associations (HOAs) will be very familiar with, and it’s one you should know if you own a timeshare. 

In simple terms, a “special assessment” means that a big, unexpected maintenance need has arisen at the property, and the owners (like you) are going to have to pay extra for it. For example, let’s say that you have a home resort located on a beach, and hurricane season rolls around. The storm tears through and causes damage to the building. 

You and other owners may be responsible for paying for part or all of that damage through a special assessment, even though you have already paid all of your required annual fees for the year. As large of a burden as the annual fees are, these “special” assessments add insult to injury and can further sink your financial outlook.

How Much Do You Pay and When?

timeshare maintenance fees: person looking through bills

After reading the dire financial problems that can arise as a result of annual maintenance fees, you may rightly be wondering if you can at least depend upon your fees staying the same from year to year. This question is often resolved by the language of your timeshare ownership contract. 

Before you get your hopes up, though, you should know that an annual fee cap is such a rare creature that it might as well not exist. Some timeshare contracts might cap that annual increase of your fees. For example, some (very rare) contracts might provide that your fees will “only” rise 2% or 4% per year. 

You should realize, though, that a 4% increase over 20 years represents a total increase of 80% from the original amount of the annual fee. And those provisions are not even the most onerous. 

Practically no contract you see  will limit the number of increases in annual maintenance fees. If you’re unlucky enough to have one of those, there’s no telling how much you could pay in the future.

These lingering unknown costs, which continue forever, are often a central concern that causes owners to try and sell their units or retain Centerstone Group to help them with their timeshare exits.

What Happens If You Stop Paying Your Fees?

keys on top of a foreclosure notice

Some owners find themselves in a terrible position: They can’t afford to keep paying annual maintenance fees, and they can’t easily get rid of their timeshare units. Then, in a fit of frustration and desperation, they decide to just stop paying the fees. After all, they think, what’s the worst that can happen?

Actually, the worst is quite bad. The failure to pay your annual fees is a breach of your agreement that will typically give the resort the ability to foreclose on your timeshare property interest. In the context of a timeshare, this means that the resort legally takes your property interest and uses it to pay itself the money you owe.

And, in states that allow lenders to come after assets other than the loan collateral, a resort may even be able to get a judgment against you for outstanding amounts, even after it has disposed of your timeshare. This can include a lien on your other property. Even if they don’t, the hit to your credit from a foreclosure will be enormous.

Of course, a problem with this (for both you and the resort) is that timeshares often don’t have much value, so it’s unlikely that a foreclosure will make the timeshare company whole. In that case, a timeshare company may use other tactics that can make your life even worse. 

They can turn you over to a debt collector, who can make your life miserable with constant phone calls and harassment. The failure to pay your annual fees will also definitely show up on your credit report and affect your credit score. This can have lasting effects for years — good luck ever getting a loan for anything else with such a negative mark on your record. 

For this reason, Centerstone Group strongly urges against the strategy of failing to pay your fees. Every day, we work with owners who feel stuck in their timeshares. We can use our own proprietary strategies to put pressure on resort developers and find other legitimate ways to exit, like our transfer program, where we match you with another party who is willing to take over your unit and pay the maintenance fees.  

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Unburden Yourself

Many timeshare owners are disheartened when they discover the reality of annual maintenance fees. Worse than that, the never-ending parade of ever-increasing fees can sink you financially. That should never happen as a result of just trying to take nice, relaxing vacations for the rest of your life.

Signing up for a timeshare might have been a mistake, but don’t beat yourself up about it. Ignoring the problem or continuing to pay for a timeshare unit that you don’t want are non-solutions that will only make your problems worse. If you can’t take it anymore, reach out to Centerstone Group today for a free consultation and case evaluation.


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