So you’re ready to give up your timeshare. Maybe you can no longer afford the climbing annual maintenance fees, maybe you’re ready to vacation in another spot, maybe your kids are grown up and you won’t be traveling as much in the future.
Whatever the reason, it’s time to let your timeshare go. You’re ready to make a deal, so you contact the developer and… nothing.
With the modern timeshare industry as we know it, there is no viable option to simply give up, give back, or even buy your way out of your timeshare. While there are private companies promising to help free you from your timeshare obligation, there is generally no way to simply give up or pay your way out of a timeshare commitment with a developer – at least not without a hefty legal battle.
Why is it all but impossible to give back a timeshare? Let’s examine three major contributing reasons:
1.) A Timeshare is Not Deeded Real Estate
While the timeshare industry started out by selling real estate – that is, a specific piece of a resort condominium that was also divided up for time – the modern industry is now almost-exclusively on a points-based or right-to-use model, which allows developers to increase their sales without restrictions – and without actually conveying real estate ownership to the timeshare owner.
Thus, while a timeshare may be marketed and sold to you as a real estate investment, it does not actually carry any of the advantages of a deeded piece of real estate (such as, say, inherited value or remarketability). But, because the timeshare is associated with property use, developers refuse to treat it as a mere service, claiming that their product has value as real estate – which means that you won’t simply be able to negotiate your way out of your contract.
2.) There is No Timeshare Resale Market
As our own Michael Finn has said before, it is not uncommon to see desperate timeshare owners turning to eBay, where you may see timeshares listed for as little as a dollar. Why are owners so desperate to sell for so little?
Because of years of industry suppression, there is no active timeshare resale market of the sort that you might see with comparable consumer goods, such as automobiles, for example. As they have reported in their own SEC filings, most timeshare developers see this lack of a secondary resale market as better for their bottom lines: Without a healthy aftermarket, timeshare owners have no choice but to continue paying for their unshakable obligation in the form of interest and climbing annual maintenance fees.
The bottom line? The more difficult it is to give up your timeshare, the longer you will be stuck paying for fees – even on a timeshare you aren’t actively using.
3.) Timeshare Resale Companies May Not Free You From Your Obligation
With this in mind, a sub-industry of timeshare resale companies has sprung up, promising to help struggling timeshare owners free themselves of their timeshare contract. But there are two big reasons to be wary.
First, some scammers look at desperate timeshare resellers and see dollar signs. Timeshare resale scams are fairly common, and fairly dangerous – some have duped unsuspecting timeshare owners out of hundreds, even thousands of dollars.
The other reason? Even reputable timeshare resale organizations cannot guarantee that you’ll recoup your investment. These redemption companies work with timeshare developers and travel clubs, transferring inventory back and forth by means of exclusive agreements and partnerships. Depending upon market conditions, the industry may or may not be willing to take back an interest at any given moment, depending on whether they think the interest will be easily remarketable. So while a redemption company may seem like the easiest way to simply and quickly give up your timeshare, you don’t necessarily know what kind of a deal you’re going to get, or just when it will come through.
As with most timeshare-related matters, caution is paramount and research is essential. Do your research about your timeshare developer and any potential redemption opportunities online, as well as with the Attorney General and your state’s consumer protection agencies.
If all else fails or if you have any more questions about the timeshare industry, don’t hesitate to get in touch with us!
Led by Attorney Michael D. Finn with 50 years of experience, the Finn Law Group is a consumer protection firm specializing in timeshare law. Our lawyers understand vacation ownership as well as the many pitfalls of the secondary market of timeshare resales. If you feel you have been victimized by a timeshare company, contact our offices for a free consultation. Know your rights as a consumer and don’t hesitate to drop us a line with any questions or concerns.