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One thing is for certain: timeshare companies LOVE fees. If you’ve been an owner for any length of time, you’ve encountered timeshare fees. You probably expected some of them. After all, nothing is free, right? But chances are, you’ve also run into some unexpected charges. Surprises are fun, but financial surprises? Not so much. In this guide, we’ll look at common timeshare fees that apply to most buyers. In part two, we’ll check out fees for special circumstances.
Your first timeshare fee is, of course, the cost of your timeshare. Luckily, you were expecting this one. According to the ARDA, the average timeshare cost $22,180 in 2017. Of course, you can spend a lot more or a lot less. In general, you’ll spend the most when you buy directly from the developer and don’t negotiate your price. But with some negotiating skills, you could reduce what you’re paying by quite a bit. Of course, timeshare sales reps are notoriously high-pressure and not everyone has what it takes to say no or talk them down. Or maybe you bought your timeshare on the resale market for much less. Whatever you paid, we hope it was in your budget because there are more fees to come!
If you finance your timeshare, your next fees are interest fees on your loan, similar to interest on a real estate loan. However, a timeshare loan is very different from a mortgage, which are secured loans and usually have low-interest fees. But timeshare mortgages aren’t a thing. Instead, you must finance your timeshare another way. If you choose developer financing, expect to pay 12-18% interest. Personal loans often have better interest rates but will require you to have better credit than a developer loan. Credit cards will have the highest interest rates, so if you don’t plan to pay off your timeshare ASAP, don’t charge it. Of course, any kind of financing will affect your credit, which could have bigger ramifications down the road.
When you sign your contract, the company may charge you these fees for transferring the deed to you and other recording costs, not unlike what a title company would charge in a traditional real estate transaction. Although these are typically small, one-time fees, it pays to be aware in advance.
Maintenance fees are the most common and can be the most expensive of all timeshare fees over time. Each timeshare owner pays an annual maintenance fee that covers basic maintenance and upkeep for the resort. The cost varies greatly from resort to resort, but in 2017, maintenance fees averaged almost $1000. In a deeded timeshare, costs vary by unit. In a points-based system or vacation club, fees vary by number of points. And maintenance fees tend to rise every year. A few dollars here or there might seem small, but over time they add up. Before you sign your contract. request a maintenance fee history to help you predict future fees. Nothing is certain, of course, but if you see a pattern of steep increases, you may want to reconsider your purchase.
Special assessment fees are far less common than maintenance fees but are no less serious. These are levied by the HOA to cover the costs of significant upgrades or repairs to the resort itself. Although each special assessment is typically a one-time payment, they are unpredictable and costs can be quite high. Since special assessments often happen when the resort does a big renovation and (hopefully) improves the facilities, you may be able to get a sense of when the next one will occur based on the previous one. You should be able to obtain a special assessment history from your HOA. Special assessments for repairs are much harder to predict. Who knows when a water main will burst or when severe weather will sweep through? If you’re considering a timeshare in a hurricane-prone area, for example, consider how you would handle major storm damage.
Before you buy, think carefully about whether you want a lifetime of timeshare fees. If you already own your timeshare and can no longer afford all the fees, it might be time to opt out and consider timeshare cancellation. We can help. The consultation is free. If you decide to work with us, we do charge a fee, but it’s a one-time fee, we promise. And it’s backed by our 100% money-back guarantee. Contact us today to get started.
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