We all love timeshare resorts — the golf, the beaches, the accommodations, the food, the feeling of luxury.
Enticing invitations via mail or email beckon to us to come and take a peek at owning a timeshare. But in the back of our minds, several questions swirl: Is this a good deal? Are we really getting what we pay for?
While we may pine for these luxuries, we must be extremely cautious in making any purchase because many buyers discover expectations don’t follow through, and they might face more trouble if they end up needing to sell.
Brandon Reed, CEO of Timeshare Exit Team, a consumer protection firm in Lynnwood, Washington, offered some thoughts and suggestions people should assess before they buy or sell a timeshare.
1. Do some research about the timeshare industry and how it works. Go to eBay and plug in the timeshare you are contemplating — even during the presentation — and see what the value is.
2. Before signing a contract read every word. Two questions all potential buyers must ask themselves: How thoroughly have I read the purchase agreement? Do I know what it means? Often, timeshare contracts include many clauses that require careful scrutiny. Potential buyers should take the contract to a contract lawyer.
3. Pencil the costs, the usage and the assessments to see if it makes sense. One thing people need to think about is usage: How often are they really going to use the timeshare? Plus, people need to look carefully at special assessment fees because they can come from almost anything — a new roof, water damage inside and outside, flooding damage to the foundation or even upgrades to the resort. Also, fees increase because people don’t pay their maintenance fees. About 30 percent of timeshare owners fail to pay their maintenance fees so the cost are shouldered by the other 70 percent.
The truth is, buying a timeshare never makes sense. When you buy a timeshare, you are literally paying into a resort whose liability you inherit in perpetuity and you are liable for any special maintenance fees.
4. Do your due diligence. Do your research and ask hard questions. While lots of information is available about timeshares, people often do not know where to look.
The Federal Trade Commission warns consumers: “If you’re thinking about opting for a timeshare or vacation plan, it’s a good idea to do some homework.”
The FTC and Laura Coffey from Today.com suggest potential buyers should complete an evaluation of property by visiting the facility, talking to current owners, chatting with local real estate agents and reviewing complaints. Coffey advises, “ask for a copy of the property’s current maintenance budget, and find out what’s done to manage and repair the property.”
5. Think, take a deep breath and sleep on it. You may not get that opportunity during the sales presentations because it is usually a high-pressured sales pitch, and several managers intervene and try to get you to buy immediately. However, you still have the right to think about the purchase before you buy.
6. Be cautious when looking to sell: Reed suggests timeshare owners “never enlist a listing company that asks you to pay an upfront cost to sell it.” The FTC suggests to, “go into skeptic mode” when considering a listing company.
Groups like the FTC and Reed’s Timeshare Exit Team are information sources.
“We educate people,” Reed states. “We are transparent and want to help people. We are not timeshare haters. What we don’t like is the way they conduct business. Often, the contract you signed isn’t what you are actually getting. To me, it’s like thinking you are buying a Rolls Royce or some other luxury car and in reality you are getting a Pinto with a blown engine and a flat tire or it’s missing on all cylinders.
“We believe timeshares are all around a bad deal. Period. We don’t want to focus on what you lost. Rather, we look at how much we will save you.”
If people want additional information about the timeshare developers, sellers or even the management companies, they should contact the Better Business Bureau or the American Resort Development Association.