Wyndham Owners Forced to Assign Interest to Trust, File Lawsuit.

Wyndham Owners Forced to Assign Interest to Trust, File Lawsuit.

When a timeshare purchase is misunderstood, disappointment usually prevails. This is especially true for those that sign contracts under false pretenses. While ultimate regret isn’t always the outcome, believing in the product before experiencing anything yourself is risky business. When timeshare buyers aren’t critical, incentivised sales people have been known to bend the truth to close the deal. According to Carolyn Nolen, this is what happened to her and a handful of Wyndham owners this past year.

In February, Nolen spearheaded a class action lawsuit against Wyndham Vacation Resorts (Carolyn Nolen, et al. v. Wyndham Vacation Resorts Inc., et al., Case No. 6:20-cv-00330-PGB-EJK) in an attempt to garner restitution for the misrepresentation of assigned interest. Although timeshare companies have been known to use different tactics in the past, this shows how deceptive timeshare sales practices can potentially be. In this case, the Wyndham owners claim they were led to believe that they’d be the beneficiaries of assigned timeshare interest that was placed into a trust.

How Did The Trust Benefit Wyndham?

Once the purchase was complete, Wyndham owners say they were forced to assign 100% of their timeshare interest to Club Wyndham Plus. This was said to be a program governed by the “terms of the Fairshare Trust”. However, it is stated that the real beneficiary and controller of the trust is Wyndham. Not only was Wyndham allegedly marketing its product in an aggressive, misleading manner, but they were accused of unethically profiting from the same misinformation used to close the deal. Pretty confusing stuff.

In other words, the disappointed Wyndham owners admittedly state the Fairshare Trust was not properly explained to them. Had they known the Fairshare Vacation Owners Association (FVOA) was the same thing (a Wyndham entity), they would not have made the purchase. But because it was held from their knowledge and the buyers thought they’d be benefitting from the product– as if it were some sort of investment– they believe they have a case.

What Else Works in the Favor of the Wyndham Owners?

The plaintiffs also pointed to the Arkansas Trust Code, stating, “Trustees cannot profit from the trust, even if they did not breach the trust in profiting from it.” It appears there isn’t much grey area here. A trustee is required to administer the trust solely in the interest of the beneficiaries. The code also goes on to say, “a trust and its terms must be for the benefit of its beneficiaries.” So the allegations that Wyndham and another entity is benefitting from interest but buyers aren’t raises some concerns. 

According to the lawsuit, Wyndham owners also believe that the timeshare company is using their power from these unfair trusts to make decisions outside of their best interests. The board of directors is said to have the control over program updates, important developments and changes to the trust itself without owner consent. The Plaintiffs also accuse Wyndham of appointing their own executives and employees to the board “to control the actions of the Trustee.”

The Tipping Point of Filing a Lawsuit Against Wyndham.

The Wyndham owners further complained that they were required to pay administration and operating costs for the trust. They expressed their dissatisfaction with the binding contract forcing them to keep up with payments or face penalties. Carolyn Nolen and her class action suit against Wyndham is a perfect example of buyer’s remorse due to alleged misleading tactics that altered customer satisfaction. Others names in the lawsuit were Cara Kelley, Paula Litton and Windy Kelley.

While buyer negligence may be thrown in the face of the plaintiffs, the high-pressure sales environment, Arkansas Law and minimal disclosure may play a role in the outcome.

Tips For Consumers Taking Out a Personal Loan to Buy a Timeshare.

Tips For Consumers Taking Out a Personal Loan to Buy a Timeshare.

Taking out a personal loan for a vacation ownership usually seems like a good idea after speaking to timeshare salespeople. Misleading promises during the presentation convince many that they’ve stumbled across a deal of a lifetime. Because of this, thousands of buyers borrow money in order to purchase somewhat of a mirage. Many don’t even realize they’ve made a mistake until it’s too late. Interest, maintenance fees, travel expenses, taxes and other costs can create quite the burden. Not to mention the emotional impact of false promises

The problem is, the perpetual agreement that vacation owners sign is binding. Getting out of the contract is burdensome in itself. That’s why we believe it’s important to help inform consumers before they’re even presented with the opportunity to make a life-altering mistake – like a timeshare purchase. With that being said, a recent article by MSN covered a number of things to look for when taking out a personal loan to buy a timeshare. So, we thought we’d highlight some of their points for you.

First Things First, Analyze Everything.

According to ARDA, the average sales price of a weekly interval is $22,942. But this number is far from finite. Sadly, most buyers aren’t truly aware of the totality of the expense and how much interest adds to it (17-19%). This is often intentionally hidden from them. While a timeshare loan may give you an opportunity to travel places you’ve never been, it can also alter your lifestyle. The key to avoiding a regretful timeshare purchase is simply taking the time to read into every detail before buying. Counting on sales teams to cover all of the bases is wishful thinking.

What Caught Our Attention About the Article.

One of the first things MSN mentioned in their post was the concept of reselling fractional interest. They did a great job of explaining how timeshares actually depreciate. This is why most banks won’t finance them and lending often goes through the developer (or credit card partnership). Nobody is going to take over the outstanding balance of an unwanted timeshare as it is proven that almost never does the collateral (timeshare) hold any value on the secondary market. 

If you’re ignoring interest rates because you think you can rent or sell the property, then really think about what you’re doing. It’s value in the marketplace is far less than what’s still owed on it. A timeshare is not the same as homeownership. The simple fact there’s literally no financial return should deter many from taking out a personal loan to buy a timeshare. Thousands of buyers would avoid remorse if this was fully understood.

Other Tips Regarding Personal Loans For Timeshares. 

MSN’s article also pointed out a number of things to look for in timeshare financing. Like all large purchase loans, the fine print should always be thoroughly inspected. Adding up numbers and doing the math yourself is important. This is the last chance you have to catch something disadvantageous. Since other items have been known to be included in timeshare finance packages, check numerous times if you can. MSN even goes as far as saying, “Don’t allow anyone to strong arm you into opening a credit card.” No matter how good 0% interest sounds, APR can be higher than expected.

There are also alternative ways to take out a personal loan to buy a timeshare. For some, the developer’s option may not make sense but they’re still committed to the purchase. While it’s still important to analyze your intentions, MSN recommends looking into unsecured personal or home equity loans for a solution. Lower interest rates can be expected – but realize a default mortgage can cost you your house. Is that worth it?

The Bottom Line With Loans For Vacation Ownership.

Every day, we speak to dozens of unhappy vacation owners, desperate for relief. Although timeshare sales teams deserve most of the blame, taking the time to review every detail would have saved them a lot of time and money. If you’re considering a purchase of this magnitude – even if you think it’s a limited time offer – please do your homework. There are plenty of publications providing a wealth of timeshare information online. Take advantage of these resources and make a decision that’s best for you.

Wyndham’s Alleged Fraudulent Timeshare Scheme Class Action Suit.

Wyndham’s Alleged Fraudulent Timeshare Scheme Class Action Suit.

After paying over $80K to Wyndham for a timeshare bought in 2015, David and Brenda Kriens are now suing the timeshare conglomerate for sales fraud. According to the couple behind the class action lawsuit (David J. Kriens Sr., et al. v. Wyndham Destinations Inc., et al.,), Wyndham allegedly used a “highly organized” timeshare scheme to misrepresent the features and overall value of the purchase while leaving out important elements of the agreement. In turn, this caused them to spend a lot of money with little to show for it.

Represented by Donald S. Hackett III, the Kriens claim the scheme intentionally avoids the discussion of “prohibited limitations” for points program (VOI’s) in order to close deals. From their perspective, nobody would make the purchase if they knew the sales pitch wasn’t entirely true. Like most unhappy vacation owners, dealing with minimal disclosure can be a tough pill to swallow. Especially when you find yourself under contract after being lied to.

What Did Wyndham Leave Out of the Sale?

Regarding the Kriens’ contract, they agreed to purchase a number of points for a specific dollar amount. According to their understanding, they would be able to use these points to stay at “several resorts” owned or operated by Wyndham or an affiliate. They also confirmed they knew some resorts and locations would cost more points due to popular demand or the resort’s overall rating.

What the Kriens did not believe was fully explained was the simple fact that there were additional “factors” that could hinder them during booking attempts. The legal accusation specifically says “much is represented to prospective customers [during the sale], but representatives for the company do not accurately represent certain limitations of the system.” One of the primary factors left out was that other point holders would be in competition with them for timeshare units.

After processing thousands of complaints for the timeshare industry, our understanding of point memberships is that available spaces may rarely be consistent and predicated on demand – allowing price gouging to hike profits through upgrade “solutions”. Aside from failed expectations, the class action suit is also alleging many of the units promised to point holders are often occupied for prospect tours, retail leasing opportunities and other marketing efforts. It’s rather ironic that nearly every timeshare owner we speak to has similar assumptions.

The Kriens Aren’t Wyndham’s Only Timeshare Problem.

Hypothesis aside, the class action lawsuit simply wants Wyndham to admit they knowingly misrepresented the opportunity to the Kriens (and others) in order to increase profits. False advertising for a pair of slippers is one thing – but after receiving over $80K from the Kriens, you would think at least an apology would be provided. Especially if they’re not interested in providing specifically what their sales teams presented.

Thousands of people have relied on timeshare sales teams for adequate product representation and have been let down. This isn’t the only lawsuit of its kind against Wyndham. After reviewing hundreds of cases like this, it’s hard for us to believe timeshare companies will ever admit any wrongdoing. But that doesn’t mean the Kriens won’t receive restitution for their losses. Unfortunately, they’re going to have to go through a lot of trouble just to get it.

DRI Debt Collection Woes Place Timeshare Company in Hot Water.

DRI Debt Collection Woes Place Timeshare Company in Hot Water.

The past few years haven’t exactly been full of positive memories for some of the timeshare owners at Diamond Resorts International, Inc. (DRI). It appears there has been an increasing number of buyers who have not been able to match their expectation with the actual experience – giving them more of a desire to escape the perpetual contract than to continue on with ownership. These types of situations usually stem from allegations for misleading sales practices, omitted information by a sales rep and some even complain of flat out lies. While the timeshare industry has been rather sloppy in these areas in the past, it’s not the only causes for scrutiny.

Another DRI Debt Collection Violation Emerges.  

In 2018, the timeshare operation brought the hot water back to a boil when they decided to bypass debt collection regulations and threaten owners for payments. This is a lot different than the DRI debt collection lawsuit that we covered last week. Either way, it appears Diamond is not messing around when it comes to the money they believe they’re owed.

Because of their alleged decision to pursue payment outside of industry requirements, a class action lawsuit was filed against them in the U.S. District Court of Arizona. The plaintiffs accused DRI of violating the Fair Debt Collection Practices Act (15 U.S.C. § 1692 et seq. (“FDCPA”). 6.) by means of “abusive, deceptive, and unfair debt collection practices by many debt collectors.” The FDCPA was involved in this designation.

According to the proposed class action, “Congress enacted the FDCPA for the following purposes: to protect consumers from a host of unfair, harassing, and deceptive debt collection practices; to eliminate abusive debt collection practices by debt collectors; to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged; and to promote consistent State action to protect consumers against debt collection abuses.”

Getting Out of a Diamond Timeshare is One Step.

Although many owners find it extremely difficult to legally (and totally) terminate their timeshare agreement, doing so can be a liberating experience. At the same time, it doesn’t always mean timeshare problems have been fully eliminated. No matter how much evidence is stacked up against resorts, they never seem to cease a claim of innocence. The signature of uninformed consumers is constantly the scapegoat. 

It’s sad to know that timeshare companies refuse to see an unhappy vacation owner as a victim. Even if the timeshare purchase were to completely wipe someone out, rarely is mercy shown. This suit sheds light on how Diamond reacts when an owner wants out of their agreement and financial obligation

A Reminder From VOC About Timeshare Credit Lines.

When it comes to credit reporting for an owner who walks from their financial commitment – the timeshare company may have the ability to affect a timeshare owner’s credit report. Since consumers agree to a property owner’s terms, the resort’s collections division (or hired agencies) manage this. You should never hire a cancellation firm because they promise an untouched credit report. Unless you receive something in writing from the resort, you can’t expect this to occur. 

Even then, they still have the ability to impact a credit report with credit reporting errors that may be able to be successfully disputed. Owners still find credibility in a well-known brand and assume the reporting is valid, however oftentimes there are many errors on an owner’s report where the creditor or timeshare company can be penalized with large fines for reporting the errors. 

Many former owners are still forced to pay the price for a long time because of bad credit scores. Although we have tools in place to aid with this process, not everyone does. This is why it’s important for vacation owners to understand the industry and their contract before making decisions. The DRI debt collection procedure is questionable at best. Nearly every pitfall stems from a sales pitch that isn’t entirely true. Canceling under verbal pretenses – after buying an undisclosed product – implies that owners haven’t learned their lesson and they will continue to get burned.

Timeshare Credit Reporting & Timeshare Debt Collection Costs DRI Lawsuit.

Timeshare Credit Reporting & Timeshare Debt Collection Costs DRI Lawsuit.

Unhappy vacation owners usually experience an exhausting wave of resistance from timeshare resorts when seeking a way out of their perpetual agreement. Because of this, many fail. In most cases, the resilient and financially stable are the only types of owners able to obtain some sort of restitution. But even then, buying a timeshare can still leave scars. Although the evaporated cost can be troublesome, timeshare credit reporting and failed debt collection procedures can be devastating.

A mark on a purchase of this magnitude doesn’t go unnoticed in today’s world of risk calculations and technological assumptions. In other words, negative credit reports from timeshares limit purchasing power. In turn, this can really hinder one’s quality of life – bringing us to this week’s news article. After filing a previous sales fraud suit resulting in a settlement with Diamond Resorts International Club, Inc. (DRI), two former owners recently filed another class action lawsuit against the timeshare resort for reporting negatively on their credit.

Not the First Lawsuit By These DRI Owners.

The proposed lawsuit essentially alleges that DRI used it’s “collection arm” to involve Experian Information Solutions in credit reporting fraud that derived from their settled timeshare accounts. But it’s important to not forget the context of the suit. After already being involved in a previous legal battle with the owners, it seems odd that Diamond would not have complied with the terms of the settlement. When someone asserts that your sales departments used “deceptive sales practices” and made false promises or “oral misrepresentations” about the product, then you should probably waive the white flag. 

Even though Diamond Resorts International Inc. agreed to waive and terminate “any and all” of the owner’s remaining balances to release them from their contractual obligations, they allegedly did not completely follow through. The plaintiffs balances were cleared, but they stated that the timeshare credit reporting for major bureaus inaccurately showed the purchase as being a “charge off”. As you can imagine, this infuriated DRI’s former owners. It wouldn’t be a surprise to us as failed timeshare debt collection procedures are common in this industry. It’s all part of the well-oiled collections scheme.

Disputed Timeshare Credit Reporting for DRI.

After spending even more time and energy communicating with the three major credit bureaus, the case goes on to say that the plaintiffs received minimal closure. Experian said they would take care of the disputed account and TransUnion told them it was not on their reports. But according to the lawsuit, a negative tradeline remained after Experian simply “updated the accounts”. Despite their alleged promise to delete the accounts and release the plaintiffs from any liability, it was argued that DRI “permitted and caused the wrongful report to occur.” 

What’s interesting about this story is that the plaintiffs claim they were lied to every step of the way. Not only did they state that they were initially sold on their ability to acquire and redeem timeshare points for right to use (RTU) lodging at “certain resorts” – they were continuously complained that they were lied to about their options. Once they figured it out and took legal action, they thought they attained resolve. But they didn’t. Now, two former owners are dealing with even further inconvenience stemming from Diamond’s actions.

It’s hard to tell how many people are affected by a timeshare-gone-bad. But with every story comes new light on the deception behind the industry. There are tons of concerns surrounding timeshare credit reporting and failed timeshare debt collection procedures. The problem is, most people don’t know what hit them until it’s too late. If you have any questions about ownership or the process of cancellation, never hesitate to reach out.

BBB Reports Record Complaints for Timeshare Exit Business in 2019

BBB Reports Record Complaints for Timeshare Exit Business in 2019

Taking the time to analyze the mistakes and failures of our industry helps us provide the best possible solution for timeshare owners. While public records of sales infractions and class action lawsuits provide us with insight on misconduct in the relief realm, consumer complaints are what really help us understand the entirety of the buyer’s experience. After reviewing this past year, the Better Business Bureau’s 144 complaints for one timeshare exit business caught our attention.

Since we only specialize in one thing, we have to be able to advise all vacation owners on every option. This is why we offer no-cost consultations. Every buyer deserves a chance to identify potential pitfalls before proceeding with any transaction. Our intent isn’t to shame companies, but to inspire change throughout the exit industry. When owners consider termination with VOC, we don’t want to leave anything to question. But some operations don’t seem to mind, impacting the reputation of the industry as a whole.

The Downward Trend of Timeshare Exit Businesses.

The BBB has been noticing a pattern in timeshare exit business complaints over the last few years. At this point, hundreds of grievances have already poured in surrounding customer service issues, contract disputes, warranty concerns and problems with service guarantees. Oftentimes clients complain about inadequate case updates and their inability to garner a refund. Although the cancellation process can take some time, clients should have clarity on what to expect. Doing so allows them to trust and understand the process. 

Even when a certain timeshare exit business replied to BBB complaints, it doesn’t seem like they’re doing much to address the root of the problem – hence the record number of grievances filed in 2019. Many exit companies tell consumer protection agencies that they’ll “right the ship” but sit on their hands for years – even when vacation owners continue grumbling about the same things. Because of the growing mistrust, timeshare owners have even begun to reject the exit company’s responses.

The Frustration of Misled Timeshare Owners is Obvious.

One timeshare exit business review had a telling response late last year. “‘X’ wanted to try one more avenue, but we are having none of that. No more delays, refunded demanded as the only resolution. A representative from Customer Relations said they would put our refund request to upper management immediately. So now we wait..” You can almost sense the impatience and mistrust in this reply. Another customer response helps us better understand why.

“I am rejecting this response because: Though ‘X’ was unable to provide the service we signed up for, they did declare they would honor their refund policy. This seemed to be initiated however the electronic legal documents issued did not have our correct mailing address and did not have the correct refund amount. We have asked repeatedly for the documents to be corrected but do not get any reply. We can’t sign documents that are incorrect and the electronic documents have expired. It has been over a month and we are getting no response so our case is still unresolved.”

Without looking through every single complaint, you can tell timeshare exit businesses are struggling to follow through. “I am requesting my refund of $5,975.00. The response is not acceptable. I have been waiting for communication since my last BBB complaint [on] 11/2019 and have not received any follow-up on my exit.”

Vacation Owner Trust is Beginning to Waiver for Exit Firms.

The simple fact that the company is offering other products while failing to deliver on an initial promise is also discouraging. “My trust in this company has grown even further in not trusting a thing they try to sell me.. Please stop talking in circles and stick to the fact: I paid, I waited 18 months, no timeshare exit completed.. Please process my refund and have a great day.” 

From the looks of it, customers aren’t buying their efforts. “The response is not acceptable. I explained to Derek, ‘The only reason he called was because of my complaint to BBB’.” Over the last 3 years, one exit company has tallied nearly 360 complaints. 41 have already been filed on the BBB’s platform this year. 

Timeshare Exit Businesses That Have Failed to Provide Resolve.

No matter how eager people are to simply move on from the negative experience, every little detail seems to let them down. “The email does not give me a timeline for my refund and is not acceptable. I have been hearing the same thing since I signed up with the company, ‘Someone will give you a call’. Why do I need to keep reaching out to BBB for someone to give me a call? Not Acceptable.” 

Keep in mind, these people were led to believe their timeshare frustrations would soon be over. After battling with the resort – sometimes for years – they finally made the decision to terminate their agreement with paid endorsement brands in the exit marketplace. Little did they know they’d still be under contract and battling the timeshare exit business for another promise that wasn’t delivered. This is why we stress that all owners do their research before hiring any company whether it has to do with assisting them with their timeshare contract or a service call for home maintenance

Washington Finally Steps In For the Consumer.

Some disgruntled owners have been waiting on an exit refund for a while now. Because of this, the King County Superior Court in Washington State decided to go after Timeshare Exit Team for unfair or deceptive business practices in February of this year. The court’s accusation states Timeshare Exit Team (AKA Reed Hein and Associates) violated multiple laws in the Debt Adjusting Act and the Washington Consumer Protection Act.

Maximizing profits can be a dangerous thing when you’re unable to deliver on the basics of a service. This is why we focus on what we do best and always qualify every timeshare owner before explaining our attorney based process. At the end of the day, making things more difficult for an already devastated owner is not worth it. Even if timeshare exit companies try to cover up their deficiencies, the experiences of their customers will still remain. For their sake, we hope all cancellation services take notice.

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