As summer approaches, the season brings more opportunities for leisure travel and more chances for scammers to exploit unsuspecting individuals looking to sell a timeshare.
In a March alert, the Federal Trade Commission highlighted the risks associated with offers from supposedly legitimate buyers interested in your timeshare unit. These dangers extend to other unsolicited offers as well, especially as scammers become more sophisticated and many consumers fail to take basic precautions.
“Maybe you weren’t thinking about selling your timeshare, but suddenly someone calls and tells you they’re a real estate agent with an interested buyer,” the FTC said in its alert. “They might have information about you and your property, making the offer seem credible.”
5 Tips to Avoid When Selling Your Timeshare
The reality is that almost all timeshare units, which provide ownership rights at specific resorts, can be difficult to sell. Therefore, it’s unlikely a legitimate buyer is waiting in the wings to buy your timeshare. The following tips can help you avoid falling victim when trying to sell your timeshare:
1. Unsolicited calls to buy or sell your timeshare
Owners that may want to sell their timeshare should be aware that not all scammers operate over the phone. Companies eager to separate you from your money make illicit pitches via the internet, direct mailers and text messages. However, a shrewd marketer making a request over the phone to sell your timeshare can be particularly persuasive. This is especially true when the offer of a buyer aligns with what the timeshare owner wants to hear. The key warning sign is the unsolicited nature of the contact.
The first red flag is often someone reaching out to an owner who isn’t actively trying to sell their timeshare. Unless you have listed your unit for sale, legitimate buyers would have no way to contact you. We discussed in another article how timeshare sales representatives have been known to profit off the illegal sale of your information.
If the scammers are not purchasing your stolen data then they often use public records to identify and target timeshare owners. The FTC noted that they frequently focus on older adults who no longer use their timeshares but still respond to unsolicited phone calls. The lure of an offer to sell their timeshare oftentimes is how many owners fall victim to predatory operations.
2. The too good to be true offer
Most timeshare owners list their timeshares on the resale market at a small fraction of the original purchase price. This is due to a supply and demand problem in the timeshare resale market, which is flooded with owners eager to offload their timeshare burdens. Historically, timeshares have almost always been sold through high-pressure, in-person sales presentations rather than online. One can also make a strong argument that the timeshare industry has failed to effectively compete with the ever evolving online travel agencies. Many owner’s financial commitment is larger than what a travel prospect has access to without being a timeshare owner. Therefore, the reality for most owners looking to sell their timeshares has resulted in a low demand for buyers.
However, scammers often entice owners with offers that exceed what they originally paid or believe their unit is worth. These fraudulent offers are easy for scammers to make since they never intend to pay anything.
3. Faced with obstacles during the process to sell your timeshare
Suppose you’re contemplating an offer to sell your timeshare and aren’t suspicious yet. The marketer has only told you that a buyer wants your timeshare and is offering a certain price. This is where the rub begins. They may stick their head in the sand for a few weeks and then resurface with the claim that there’s a problem.
One strategy is to insist that you must prepay escrow fees or property taxes. If your timeshare is situated in a foreign country like Mexico, a scammer might assert that you could face some form of government penalty that needs immediate resolution before you can enter the country. These warnings are designed to create an artificial sense of urgency, pushing you to come up with money.
4. Automatically trusting the authenticity of documents
A scammer could send you a letter purporting to be from tax or government authorities, complete with a seemingly authentic logo or insignia. However, this logo might be replicated, and the communication itself could be fraudulent. Bank statements, tax bills, email chains, and other documents can also be easily falsified.
Some predatory operations have gone to extreme lengths, including setting up call centers to pose as a Mexican bank, utilizing stolen real estate broker’s licenses, and even leveraging the names of real law firms without their knowledge.
In essence, any request for money when you’re attempting to sell your timeshare should be met with skepticism.
5. Request to wire money
Scammers, frequently posing as real estate agents, typically begin by requesting a small fee that quickly snowballs into demands for thousands of dollars, as outlined by the FTC.
Eventually, you’ll be urged to send money, often via a wire transfer. Such transactions are difficult to trace and reclaim.
However, the saga might not conclude there. At times, scammers persist in requesting additional funds, and victims, hesitant to acknowledge they’ve been deceived, comply. Even after wiring $20,000 or $30,000, individuals may struggle to accept they’ve fallen victim to a scam. Numerous timeshare owners have shared their stories in the media, recounting how they were duped out of tens of thousands of dollars while still retaining ownership of their timeshare.
Make sure to vet the timeshare resale company
When looking to sell your timeshare unit, it’s advisable to first reach out to your home resort. They may maintain a roster of reputable brokers who can facilitate a sale. Additionally, your home resort might offer a deed back program or a similar timeshare relief initiative, providing a means for you to relinquish ownership.
For timeshares located within the United States, the FTC recommends verifying with the real estate licensing agency in the respective state where your timeshare is situated. If a title company is specified on your closing documents, contacting them directly to confirm their legitimacy is also recommended.
Furthermore, the FTC advises conducting an online search for the company or individual who contacted you, appending terms like “scam” or “complaint” to gauge their reputation. If you find yourself falling victim to fraudulent activity, promptly report it to the FTC via www.ReportFraud.ftc.gov.
