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What Happens if You Don’t Pay Timeshare Maintenance Fees?

What happens if you don't pay timeshare maintenance fees: angry woman holding documents while a man watches TV

Trying to get out of a timeshare purchase makes you consider all kinds of drastic options for cancellation. If you’ve been in the process for some time, seeking a convenient exit is probably not an option. So if your rescission period is up, giving your timeshare back through a deed-back program isn’t possible, and the timeshare resale market is not working out, you may be contemplating more extreme measures for escaping ownership, like skipping out on paying your maintenance fees.

 

If you’re wondering what happens if you don’t pay timeshare maintenance fees, know that the results are always unfavorable. Your timeshare company will come after you, you could face legal trouble, your credit score will take a huge dip, and at the very least, you’ll be responsible for paying even more late fees. 

 

For some people, giving up their timeshare isn’t a choice. They have to choose between paying off their annual maintenance fees or feeding their family. But no matter how desperate you are to escape ownership, failing to make these payments will only make matters worse. Let’s get into what happens if you don’t pay timeshare maintenance fees and the disastrous consequences it can have on your life and financial future.

 

So, What Happens if You Don’t Pay Timeshare Maintenance Fees?

When you went to the timeshare sales presentation, paid an upfront fee, and made your initial timeshare purchase, you signed a timeshare contract. Even though the salesperson probably didn’t give you the chance to thoroughly review it, according to the law, you agreed to follow through and abide by everything the contract says. 

 

On this timeshare agreement, the due date for each payment is specified, so failing to pay your maintenance fees is in violation of this contract. This violation can come with penalties like late fees or accrued interest, meaning you now have to pay even more than the initial maintenance fees. Some contracts even have a perpetuity clause that forces timeshare owners to pay these fees for life and possibly pass that burden on to their heirs.

 

If you’ve ever been late to pay your rent or credit card bill, you’re probably familiar with late fees like this. And in a situation where overwhelming financial stress is making you want to walk away from your timeshare altogether, these added fees can seem like the least of your worries.

 

But this is just the tip of the iceberg when it comes to all the expenses you’ll be responsible for if you fail to pay on time. Here are four major consequences for not paying timeshare maintenance fees.

 

You’ll Receive Endless Phone Calls

If you decide to stop paying your timeshare fees, rest assured that your timeshare resort will notice. Even though they have thousands of customers, your timeshare company wants every penny of your payment. Because in theory, these missed payments can cause them to fall behind on funding for landscaping, unit renovations, and other special assessments required for the upkeep of a resort. So as soon as you start skipping out on annual fees, your timeshare developer will start reaching out to you with constant phone calls, emails, or letters.

 

While their persistence can be annoying, it’s nothing compared to how aggressive collection agencies are. If you continue ignoring calls from your timeshare management company, they’ll hand it off to a collection agency that’ll make more frequent calls and send more letters demanding your money. Anytime you ignore them, you will get a mark on your credit report — an offense that stays there for multiple years — and your score will go down. If you find yourself in this situation, it’s better to negotiate a settlement than avoid financial responsibility.

 

You’ll Go Into Timeshare Foreclosure

Hammer and a Foreclosure Notice

Timeshare owners who fail to pay their annual maintenance fees eventually lose access to their unit. They’re blocked from using the online booking system, and if they belong to an exchange program like RCI, they won’t be able to trade for new vacation spots. Just like homeowners who fail to make their loan payments, skipping enough payments will send you into timeshare foreclosure.

 

When foreclosures happen in the timeshare industry, your timeshare contract will become null, and your developer will sell the property to a new owner. You’ll then have to find a way to pay back the money to your lender or timeshare provider depending on who you owe your mortgage to. Depending on where your timeshare is located, you may also be liable for a deficiency judgment. Aside from the potential for major debt and stress, a foreclosure also significantly affects your credit score and your ability to purchase property in the future.

 

You’re Timeshare Company Will Take Legal Action

Timeshare companies have the right to pursue legal action when your bills aren’t being paid. If this happens, you’ll have to appear before court and explain why you’ve been skipping out on paying your maintenance fees. If you can’t properly defend yourself in court, your timeshare company is legally allowed to withdraw funds from your bank account, deduct money from your wages, or place a lien on other property you own.

 

Regardless of whether you’re proven innocent or guilty, going to court will cost you time and money. You’ll have to pay a law firm to represent you as well as cover court costs. The likelihood of you winning against large timeshare companies like Marriott, Wyndham, or Hilton Vacations Club is small. And once again, your credit report and score will be negatively impacted when a judgment is made against you in court.

 

Your Credit Score Will Go Down

What happens if you don't pay timeshare maintenance fees: broken pencil on a credit report

As you’ve learned, one of the most dire outcomes of what happens if you don’t pay timeshare maintenance fees is that your credit score is docked significantly. Calls from collection agencies, foreclosure, and appearances in court not only show up on your credit report. They can also push your score down about 150 points.

 

There are a number of reasons why docked credit scores are not a favorable outcome. A low credit score makes it harder for you to apply for credit cards and obtain loans for things like cars, college tuition, and real estate. If you are actually able to procure a loan, it’ll come with higher interest rates that will cost you even more in the long run. If you thought paying for your maintenance fees was a waste of money, think of how much a low credit score will cost you. 

 

Don’t Stop Paying Your Maintenance Fees

Yes, failure to pay annual maintenance fees will eventually end your timeshare ownership. Although this is what you ultimately want, taking this path to timeshare cancellation is not ideal. You’ll end up paying extra late fees, getting harassed by endless phone calls from collection agencies, going into foreclosure, appearing in court, or above all else, taking a huge hit to your credit score that can impact your personal finances and prevent your ability to take out loans in the future. If you want to find the most responsible exit strategy, reach out to one of the best timeshare exit companies in the industry: Centerstone Group.

 

Centerstone Group has the answers for how to get out of timeshare maintenance fees safely. We are a full-service advocacy group that’s privy to all the scams that surround the timeshare industry. Our 4.74-out-of-5 score on Better Business Bureau proves we have a track record of helping clients escape timeshare ownership and return to a financially stable life. 

 

Centerstone Group’s timeshare exit team are experts at navigating releases for our clients. And unlike other timeshare exit companies who consider foreclosure to be an acceptable route for escaping ownership, we will find you a solution that will not compromise your credit score or cost you a fortune. Contact us for a free consultation.

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