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Timeshares are notorious for being incredibly complicated. And that means sometimes consumers get in over their heads. So, we created a timeshare guide series to help navigate the timeshare landscape. This timeshare guide installment covers timeshare terminology.
A timeshare is a type of real estate ownership in which the buyer purchases a fractional ownership of a vacation property. The most common arrangement involves the buyer purchasing the deed or right to use a unit in a resort or condominium for one week of the year. However, other arrangements come on the market all the time.
A vacation club is a membership arrangement in which the buyer purchases the right to make reservations at special rates for a variety of vacations. So in this type of ownership, you don’t buy property or the right to use a property. Instead you buy a right to make a reservation.
Vacation ownership is an umbrella term covering all types of timeshares and vacation clubs.
An interval is the time during which you can access your timeshare. Intervals are typically 7 days long, usually from Saturday to Saturday. However, you many encounter other arrangements.
Deeded timeshares are timeshares in which the owner purchases the deed to a specific unit for an interval each year. These timeshares usually have contracts in perpetuity. So that means they last forever. And they can be passed down to heirs.
Right to Use timeshares, or RTUs, are timeshares where the owner purchases the right to use a specific unit for a specific interval for a specific number of years. Some countries have laws against foreigners owning property. So RTU timeshares are a way to access property abroad. However, these timeshares can typically not be passed down to heirs.
Points-based timeshares are timeshares in which you own points that can be used to “pay for” vacations at a single resort or within a group of resorts. The value of your points may vary from year to year. Additionally, you may pay additional fees or need to purchase additional points for peak intervals or popular resorts.
Fixed week timeshares are timeshares whose interval stays the same from year to year.
Floating week timeshares are timeshares whose interval can change from year to year.
Red weeks are the highly sought-after peak season intervals. Because they are popular, these weeks are typically more expensive.
Yellow weeks are medium demand intervals. Because they lave a lower demand, these weeks are less expensive than red weeks.
Blue or green weeks are low demand intervals. Because demand is the lowest, these are the cheapest weeks.
Exchanges are programs that allow owners to exchange units or weeks within a network or group of resorts. These programs usually charge additional fees.
The Rescission Period is the time immediately following the contract signing during which either the owner or the contractor can cancel the contract for any reason with no fee. However, cancellation must usually be done in writing. And the length of the rescission period varies based on the location of the timeshare.
A Homeowners Association, or HOA, is the governing body of a timeshare resort or network. The HOA sets rules, levies fees, and manages disputes.
Maintenance fees are annual fees that all timeshare owners must pay. These fees cover routine maintenance, housekeeping and repairs and may cover other administrative costs. HOAs set the amounts, collect the fees, and decide how to use them. And maintenance fees usually increase over time.
Special assessments are one-time fees levied by HOAs to cover large expenses such as repairs for damages, upgrades, or revenue shortfalls.
The Right of First Refusal, or ROFR, of the resort to buy or refuse to buy a timeshare on the resale market before it is sold to an outside buyer. So, if your resort wants to, they can buy your timeshare from you. However, you need to find a buyer first.
Timeshare exit, also called timeshare cancellation, is the process of getting out of a timeshare contract. You can do it yourself. However, it’s much easier with the help of a third-party consumer advocate like Primo Management Group. So it’s a good idea to consider a partner! But remember, reputable companies like PMG offer 100% money-back guarantees, great reviews and high ratings by the BCA. Contact us today for a free consultation!
(Image source: Pixabay)