Consumer Tips

Timeshare - Reselling

If you own a vacation timeshare - the use of a vacation home for a limited, pre-planned time - be cautious of bogus resale companies who take advantage of anxious sellers in an overcrowded market.

Unscrupulous companies typically contact you by phone, mail or the Internet asking you to call a phone number about your timeshare. The salesperson may claim that the market is 'hot' for resales, when in fact the market varies considerably depending on location and the prime season for that particular unit. For an advance fee of about $300 to $700, some salespeople promise to sell your timeshare for a price equal to or greater than your purchase price. They may claim to have a list of sales agents and potential buyers. While the seller may possess these lists, it is unlikely the parties are interested buyers. To further entice you, they may promise a money-back guarantee or a government bond if they cannot sell your timeshare within a certain amount of time.

In the end some owners have found that their timeshare did not sell, their fee was not returned and they were given a bond worth as little as $60 to $70.

Timeshare transfer companies induce consumers to transfer ownership of their unused timeshares and, thus, "unburden" themselves of maintenance fees, taxes, and other costs. These scams imply that the company will offer to pay owners for their timeshares when, in fact, the owners get nothing and are required to pay up to several thousand dollars (a multiple of 3 to 5 times the annual maintenance fee) supposedly to transfer ownership.

Although some transfer companies legally transfer timeshare ownership after charging owners fees ($2,000 to $5,000 or more), others keep the title in the owner's name. Result: owners still owe overdue maintenance fees and taxes, in addition to the high out-of-pocket fee paid to the transfer company.

Contact your timeshare association to find out about non-profit organizations who accept timeshares as a donation. Before transferring your interval, make sure you research the organization and understand the process.

If a company offering to "take your timeshare off your hands" solicits you, be extremely cautious, especially if they make it sound as though they will pay you for your timeshare.

Be wary - Questions to ask a timeshare transfer company:
1. Ask what you must pay in order to transfer the timeshare to the company and how they will accomplish the transfer.
2. Ask your association to see if we are familiar with the transfer or resale company and what our experience has been.
3. Ask if they will require you to sign a "power of attorney" and, if so, ask them to send you a copy so you can have your attorney review it before you sign it.
4. Ask the company what they will do with your timeshare. (Some of these companies sell the timeshares on EBay or other websites for a few dollars. You could do this yourself and save thousands in the transfer fee). Also, you do not want to be a party to a default that hurts other Pacific Shores owners and could possibly hurt your credit rating if your name is not properly transferred off the deed.
5. Ask if the company will notify your resort and exchange company of the transfer and will provide proof of these notifications.
6. Ask how soon your timeshare will be legally transferred, i.e. now, in 30 days, 90 days, etc.
7. Ask who will be responsible for paying your costs of ownership (maintenance fees, taxes, etc.) while the transfer is pending.
8. Get all of the answers to your questions in writing before you pay any money, and have a knowledgeable friend or professional advisor review the information with you.
9. Ask for the names and phone numbers of other timeshare owners who have used the company's transfer services so you can call and ask about their experience.
10. Finally, do not succumb to pressure. If this is a legitimate company offering a reputable service, they should encourage you to take the necessary time to research the company and make an informed decision. If you are being pressured to do this now, walk away.

Keep in mind that there are other resale options. You may try selling your timeshare yourself, by placing an ad in a newspaper or magazine, or contacting a real estate agent familiar with the area. If all the timeshares have been sold in your development, consider asking the seller to establish an on-site resale office. As an alternative, you may consider an exchange program. For a fee, these programs allow you to arrange trades with other resort units in different locations.