How to Get Out of A Timeshare Contract
Getting a timeshare can be a very regrettable financial step. The pitch may be very enticing because they often start by offering you a gift. Once you accept it, you may have to sit through a very long presentation usually done in a conference room. The presentation is carried out by sales people with years of experience.
You might have been shown beautiful pictures of beaches and properties while using words like “relaxation” or “freedom.” It was a paradise presentation so you may have purchased the timeshare at an exorbitant price without talking about the annual fees or time to think about it. You are now one of thousands of people who have a timeshare contract but no longer want to keep it. It may not fit your lifestyle. Maybe you weren’t aware of the details in the contract. Maybe you weren’t aware of the fee increments. Maybe you enjoyed it for years, but now your lifestyle changed or you’ve lost interest in the property. This leads to the dilemma: “How to get out of a timeshare?”
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• Timeshares include annual maintenance fee obligations.
• In many cases these annual maintenance fees increase.
• The Internal Revenue Service lists timeshares as worthless.
• Timeshares are posted online for $1.00 and do not sell.
Why trust a resale company to sell your timeshare and pay their large fees? At this point, you may be wondering why timeshares are considered a bad investment. They may cost less than vacation homes, but vacation homes can build equity, timeshares do not. Lets take a look at some pros and cons.
We’ve heard all the benefits and pitches on selling your timeshare. But when they don’t sell, it’s time to contact us. A majority of our clients who’ve had their initial consultation with us say they’ve tried selling their timeshare, but it was ineffective. They regret spending the money on what they could’ve failed at themselves.
Reasons Why People Want to Get Out of Timeshare
It Ties You Up With Only One Company
Since timeshares mean you go to the same location every year, it can get boring. Although some timeshare companies with multiple resorts can let you trade your week for another in a different location it usually comes at an extra fee. While this is an advantage for that company it is still the same company providing the resorts. This might be satisfactory for some people, but there is a reason why there are a lot of timeshares for sale with no willing buyers.
There's A Good Chance You Don't Use It
Since a timeshare usually comes with time constraint, it must be used at a particular time. Outside interference such as schedules make it impractical for you to use the timeshare. Some people get tired of the same destination every year and are not motivated to keep going. Most sales pitches for timeshare depend on spur-of-the-moment impulses. At that time, it seems like a great idea, but once reality sets in, it might not seem like a good idea anymore.
They Are Expensive
Timeshares can cost $15,000 or more from the onset. That is without adding the annual fees which make them very expensive after years because they keep increasing. It would be better to have the flexibility to spend your money and vacation on your own terms.
Timeshares Do Not Earn Income
What happens during the year when you are not using a timeshare? That’s right- NOTHING. They just sit there when not in use and you keep spending money and paying for annual fees. Real estate, on the other hand, is an investment that can be leased or rented out to earn a profit when not in use.
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Their Value Typically Depreciates
This is the main difference between timeshares and vacation homes. Timeshares do not appreciate in value, unlike real estate. As far as the timeshare companies are concerned, what you’re buying is the time and not a part of the building. It can be compared with the purchase of a new car. Its value decreases as soon as you leave the parking lot. In the case with a timeshare they decrease as soon as you sign the contract. It is better to buy a timeshare from reseller’s because at least the initial payment is less. If you check online sites like eBay, you will notice that resale prices are substantially lower than the original prices.
Timeshares Are Not Liquid Assets
Timeshares should not be considered as assets. They are incredibly difficult to get unburdened from. A liquid asset is one that can be sold quickly to get money. If you visit trading websites such as eBay, you will see timeshares sitting there at a $1 or even $0 cost with nobody ready to buy. These timeshare owners are selling to offload them at a huge loss rather than have to keep paying maintenance fees.
Now that you know the reasons why so many people choose to get out of their timeshare contract, here are exit strategies that Timeshare Exit Pros can offer.
Check Your Contract for the Terms of Cancellation
When you were about to buy the timeshare and you had to sign the document, you may not have read the document word for word. Now you need to do that if you want to try to cancel the contract and relieve yourself of the timeshare. Read your contract thoroughly and check the section towards the end for a heading that reads “termination,” “cancellation,” or “severability”. Many timeshare contracts allow for cancellation within short period after purchase. If you are still within that window it will be easier to cancel your timeshare. You have to do this with written document. You will write a letter and send it to the timeshare company via certified mail. You must keep a copy for yourself and take note of the date you mailed it.
Find Out What Your State Laws Say On Cancellation
A lot of these companies will not tell you this, or it will not be written in the contract but some states allow consumers to cancel a timeshare contract within the first few days or week. This is called a cooling off period. It is advisable to check the website for the Department of Consumer Affairs for your state. There, you’ll find information about the applicable laws for your state. If you find these difficult to decipher you can contact the Office of the Attorney General for your state or go to a nonprofit organization for consumer rights. These may be able to help you understand your rights.
Go Through The Contract To See If It Discusses The Personal Liability Of The Purchaser.
The contract will obligate the buyer to keep paying the improvement, assessment and maintenance fees. It is unlikely the timeshare company failed to insert this provision. In the unlikely event that this occurred, you might be able to surrender the timeshare once you have paid off the mortgage.
Contact an Attorney Who Handles Timeshare Cancellations
An attorney may review the through the contract thoroughly advise you whether you have any grounds to litigate against the timeshare company. When most timeshare companies see that litigation is viable, they may release the owner from the contract. Ask the attorney your exposure to liability under your contract.
Giving the Company Back the Timeshare
This can occur in two ways. The first is called a buyback. This means the timeshare company agrees to buy the timeshare back from you. This is very rare and it is important to know it won’t be at the original purchase price. Check your timeshare contract to see if there is anything addressing a buyback. The seconds way this can happen is through a deed back.
A deed back is when the timeshare management company allows you to deed the timeshare back to them, free of any financial liabilities. This is equivalent to giving the timeshare back at no cost. It may be a giant loss at first, but in the long run it would save you a lot of future annual fees. Before asking for a deed back it is important to be current on all payments and assessments as they may be more receptive and cooperative if there is no outstanding balance.
Walk away from the payments
This is not recommended and should only be done as a last resort. Some people do this after all other alternatives have failed. This is a very risky because once you stop the payments there is a good chance the company will file a foreclosure lawsuit. Some companies will go after the owners aggressively to collect the fees. Others may take the defaulted unit back and try to sell it to a new owner who will take over the maintenance fees, but this may be limited to legacy resorts that have a tight budget. This can damage your credit score which is bad for younger owners who still want to finance, buy new cars or houses.
You can trust us at Timeshare Exit Pros. We specialize in saving you through the stress involved in going through the procedure of negotiating the cancellation. Our fees are affordable with a money-back satisfaction guarantee. We have built a reputation for being trustworthy and we have an extensive list of satisfied customers who will testify to our professionalism and efficiency. Contact us today on 866-883-5329 for a free consultation.
Filing a Complaint with Law Enforcement and Regulators
Many federal and state agencies investigate frauds and scams relating to timeshare owners and they usually encourage you to take legal action against these companies. Although these law enforcement agencies cannot help with the termination of contracts, they focus on criminal schemes involving timeshares. These criminal schemes are related to timeshare transfer companies or other scammers that take advantage of timeshare owners who want a way out of their current contracts. These scams usually work by asking for an upfront fee for services they cannot possibly render.
Avoid the scams and remember, you don’t need a lawyer to get out of your timeshare. There is no such thing as timeshare law, so don’t overpay lawyers who many not help.
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