The timeshare industry has historically been plagued by developers who use high-pressure and deceptive sales tactics to close a timeshare sale. Using false and misleading statements of what buyers could expect from their timeshare ownership, the industry has a tarnished reputation which over the years grown ever worse.
In 2008, with the collapse of the economy and crash of the stock market, many homeowners found themselves no longer able to afford their homes much less the timeshare that they had purchased in a moment of weakness.
Because a timeshare is essentially a “lifetime” obligation to pay maintenance, taxes and fees it is a liability not an asset, that many people could no longer either afford or want.
Faced with the prospect of ever increasing maintenance fees, and desperate to get rid of the so – called “ vacation of a lifetime” many timeshare owners turned to the timeshare resale market in an effort to be relieved of their lifelong obligation to pay ever increasing dues and fees.
Into this vacuum of desperate owners wanting to sell, jumped the timeshare resale scammers.
Armed with false promises of ready buyers, fast sales, big profits and money-back guarantees fly – by – night scammers proliferated with promises of a quick sale and lots of money for what was now an unwanted timeshare.
The truth is timeshares are not an appreciating asset and there is no ready market for a used timeshare. A simple search on ebay can verify the truth of this statement. By simply entering the search term “timeshare” hundreds of supposedly valuable timeshares will appear for as little as $1.00 with the seller agreeing to pay all the closing costs.
With the timeshare resale scam running rampant, the Federal Trade Commission and state consumer protection agencies began to shut down dishonest timeshare resellers for bilking timeshare owners out of millions of dollars.
The state of Florida quickly passed a state law designed to crack down on this kind of fraud. That law forbids timeshare resellers from making unfounded promises and collecting large upfront fees.
The Federal Trade Commission was even more proactive, spearheading a national effort against the timeshare resale scam bringing over 200 actions nationwide against the scammers in 28 states.
So if you are a timeshare owner who is no longer interested in the ever increasing fees, lack of availability and high pressure sales pitches to “upgrade” avoid the timeshare resales scam at all costs.
If you own a timeshare, question any offers to help you resell it. Moreover, if you are thinking of selling a timeshare look first at what is out there. Listen carefully for the promise of lots of money quickly and a request for an upfront fee. Those are two signs of a timeshare resale scam.
The California Bureau of Real Estate warns: “The fraudsters use the names of companies (some of which have professional-looking but usually phony websites, fancy-sounding titles and addresses, and purport to be escrow, timeshare resale, finance, and/or title service businesses) and individuals in California.”
Remember this, once purchased a timeshare is very, very hard and almost impossible to sell.
So if you are looking to be relieved of your timeshare and its lifelong financial obligations, find a company who can provide you a guarantee to cancel your timeshare contract.
At the offices of Vacation Ownership Consultants, we have helped hundreds of timeshare owners who no longer wish to be burdened with their timeshare.
For more information on how you can safely eliminate an unwanted, unsellable timeshare with an exit strategy, please contact us today. Our consultants are standing by to assist you. Call 1-800-614-5288
John and JoAnn Belczak vacation in Hawaii every year.
That’s in addition to trips the Yorba Linda couple have taken to Tahoe, Boston and the Carolinas. They’ve strolled the scenic beaches of Aruba and St. Kitts and been on a cruise to Alaska. Every three years, they spend a week in a 2,000-square-foot penthouse in Nuevo Vallarta on Mexico’s west coast.
Timeshares make all that travel possible for the peripatetic Belczaks and their three now-grown children. After buying their first timeshare in Kauai 10 years ago, they upped their points a few years later, then bought a second timeshare in Mexico.
“Never regretted it,” said JoAnn Belczak, 59. “It’s not cheap. We know that. But so long as you know how to work the system and you use it, it’s great.”
William Dorman has a different take on the Las Vegas timeshare he got talked into buying at a sales presentation 15 years ago. Yes, he has exchanged his parcel for trips to places like Palm Springs and Arizona, but nothing exotic. Those were always booked. He had to pay out of pocket for accommodations in New York because the timeshare there also was booked.
Now he wants to get rid of it.
“Nothing’s available, and you have to book two years ahead of time,” said Dorman, 56, of Dana Point. “People are giving them away … or they’re listed for $5 or $100 because people want to get out of them.”
Some people are happy with their timeshares, saying they give them a chance to see the world in homey, spacious accommodations that cost less than an equivalent hotel. Others deeply regret them, saying maintenance fees keep rising, they can never book the times they want and they’re stuck paying for something they can’t use.
Regardless of whether timeshares are good or bad, the industry is booming.
Sales revenue by timeshare developers and operators rose 32 percent – to $8.6 billion a year – in the five years ending in 2015, according to the most recent estimate by the American Resort Development Association, or ARDA. Association figures show there were 411,880 transactions in 2015, with prices averaging $22,240, up 21 percent in five years.
But secondary market sales by private owners have been flat and represent a tiny fraction of the timeshare market, said Bob Schmidt, data officer for Sharket.com, a timeshare resale data firm. The resale market averages 25,000 to 26,000 transactions per year, with an average price of $5,000, a fourth the value of a typical retail unit.
“There certainly are a lot of people who are interested in selling their timeshares,” Schmidt said.
The timeshare concept, which dates to the 1960s, allows multiple owners to share one property or to gain access to resorts around the world by cashing in points they’ve accumulated or through an exchange system.
People who love their timeshares say they are motivated to take regular vacations, and they get better accommodations for less money, with kitchens and, in most cases, two or more bedrooms.
An ARDA survey found timeshare owners are more likely to take annual vacations.
And because timeshares have more rooms, and thus more privacy, owners have more sex, the industry trade group claims (yes, they actually asked vacationers about this). More than two-thirds of timeshare owners say they have more sex on vacation, while less than a third of nonowners have more sex.
ARDA President and CEO Howard Nusbaum said that over a 10-year span, the typical timeshare saves a family almost $14,000 compared with renting two hotel rooms for a week each year.
“You save money, plus you get all the comforts of home,” Nusbaum said. “It’s a better way to vacation.”
But it’s not for everyone, he concedes. People who are happy sharing a hotel room with the kids or who don’t mind sleeping on Grandma’s sofa don’t buy timeshares. But for those who want to stay in a nice hotel and take a vacation each year, he said, “it works out.”
Discipline and advance planning are a must in the timeshare world, owners say.
Jeff Weir, owner of three timeshares and chief correspondent for Redweek.com, a leading timeshare resale site, said bookings can get competitive. For example, he has to call a year in advance to reserve a week at the Marriott Newport Coast Villas, where he’s an owner.
“Wait two days later, those weeks are gone,” he said. “There are some practice issues for owning a timeshare that people have to deal with.”
Most of the unhappy owners are people who own a timeshare in a “legacy resort,” or an older, single-site property not affiliated with a large club, ARDA’s Nusbaum said.
“Those are the owners who have more pent-up demand to sell,” he said.
A glut of resales
Almost half of the 614 timeshares selling on eBay the weekend of Jan. 14-15 had starting bids of $1 or less, with 37 of them going for a penny.
“There’s a glut,” says a representative of Vacation Ownership Consultants, a company specializing in timeshare contract cancellation.
Hard-sell tactics are a key reason owners end up buying a timeshare they can’t use over the long run.
Buyers are lured into sales presentations by free dinners, theater tickets or discounts on hotel bills. The presentations last hours, lubricated by free food and drinks. Then, the buyers are presented a stack of papers to sign.
“They are zombies when they sign the contract. We have judges, we have clerks, we have doctors. They all come to us. We’re getting people out of these contracts that are burdensome and oppressive because at the time they signed them they really weren’t in their right mind.”
Recently a series of lawsuits were filed accusing Las Vegas-based Diamond Resorts International sales people of falsely telling buyers their timeshares appreciate in value and are easily sold and the property could be used by their heirs when they die. A retired Oceanside couple with no income paid $150,000 for timeshare contracts with Diamond, a recent Orange County lawsuit said.
“You’re told it’s an investment. … It’s not, it’s a liability … because of the maintenance fees you have to pay every year if you go on vacation every year or not.”
The lawsuit “is without merit,” a company statement issued last week said.
In December, Diamond agreed to pay Arizona $800,000 and take back timeshares after the state alleged it had received hundreds of complaints of false statements and misrepresentations made during sales presentations, the state Attorney General’s Office said.
A Diamond statement said the firm will launch nationwide reforms this month, dubbed Diamond Clarity, “to enhance the overall customer experience” during sales presentations.
Virginia Pelton of Laguna Hills sold timeshares in the early 1990s and ended up buying four of them in Las Vegas, Palm Springs, Dana Point and Cabo San Lucas.
“I used them several times a year,” said Pelton, 88, a former model. “A lot of people say, ‘If I want to go somewhere, I’ll get a hotel.’ But they don’t travel that much. If you have a timeshare, you use it. I did.”
But then maintenance fees started going up. Her total bill is $6,000 a year, and she’s taking steps to shed her timeshares.
“I was really into it until (the maintenance fees) went out of sight,” she said. “I can’t afford it anymore.”
Anaheim bakery owner Asem Abusir, 55, tried going to court to get rid of the Las Vegas timeshare he bought for $12,000 in 2008. He said he hasn’t been able to get a reservation since he refused to upgrade to a $35,000 plan. His annual maintenance fees are $1,400.
“They said, ‘Eventually you have to upgrade, so think about it,’” Abusir said. “It’s like I have no option.”
Eventually, he was able to shed his obligation by paying a $2,500 fee.
“I didn’t want to pay for something forever that I wasn’t using,” he said. “They said, ‘Even if you die, your kids will have to pay.’”
For more information on how you can safely eliminate an unwanted, unsellable timeshare, please contact us today. Our consultants are standing by to assist you. Call 1-800-614-5288
While it is true that a timeshare contract is a binding legal document, it is often mistakenly thought that such a contract cannot only be cancelled. In fact, most timeshare companies maintain that their contracts are non – cancellable. This misconception is perpetuated by timeshare companies and user groups that are funded, maintained and controlled by the timeshare industry. The truth of the matter is, that under the law, contracts are cancellable for a variety of reasons, including fraud and mistake. Moreover, a person who is burdened by the obligations of a contract may “terminate” it and no longer be bound by the contract for reasons other than breach.
“Cancellation” occurs when either party puts an end to the contract for breach by the other and its effect is the same as that of ‘termination’ except that the canceling party also retains any remedy for breach of the whole contract or any unperformed balance. Uniform Commercial Code 2106(4); see 13 Corbin (Rev. ed.), §73.2; 13 Am.Jur.2d (2000 ed.)
Since it is the law of the land, that a breach of contract by a party to the contract may result in the other party being released from their obligations under the contract, the notion that one is forever bound by a timeshare contract is erroneous as a matter of law. The purpose of this article is to provide a ray of hope to those timeshare owners who are no longer interested in being tied to their timeshare and its lifetime of financial obligations. To start, when you first purchase your timeshare, most states have a rescission, or “cooling off,” period during which timeshare buyers may cancel their contracts and have their deposit returned. This is know as the “right of rescission.”Once this period expires, however, most timeshare companies will have you believe that their contract is non – cancellable and you are thereafter bound in perpetuity to pay the ever increasing maintenance fees that go along with timeshare ownership.
“Termination” occurs when either party, pursuant to a power created by agreement or by law, puts an end to the contract otherwise than for its breach. Uniform Commercial Code sec. 2106 (3)
In recent years, however, new techniques pioneered by real estate attorney’s who specialize in timeshare litigation have emerged. These techniques reached their ultimate fruition in a series of lawsuits filed in California on behalf of a group of timeshare owners who wanted nothing more than the complete release, termination and cancellation of their timeshare interests.
Other similar actions have followed, all seeking cancellation and termination of timeshare interests for the type of fraudulent and deceptive conduct that is frequently utilized by timeshare sales people to induce unwitting potential owners to sign on the dotted line. Such conduct includes the following representations, typically made at the time the timeshare was sold:
That the timeshare interest purchased would appreciate and increase resale price and value over time
That the timeshare interest purchased could be freely exchanged, transferred and sold.
That the timeshare interest purchased was a financial investment.
That the timeshare interest purchased would result in the purchaser receiving booking priority over non – purchasing vacationers wishing to stay at one or more of the properties owned and/or maintained by the defendant.
As a result of the filing of such actions, timeshare companies have become much more amenable to releasing timeshare owners from their timeshare obligations even without resort to litigation. In order to avail yourself of such a solution, you should retain an attorney familiar with timeshare laws and the various techniques for terminating a timeshare contract.
In sum, do not believe the naysayers who tell you that it is impossible to get out of a timeshare contract. Should you be the victim of one or more of the foregoing misrepresentations, you too may be able to cancel your timeshare contract.