When Bad Timeshares Happen to Good People
Guides, Tips, and Hacks
3 min read
People have been getting into timeshare trouble almost since the beginning of timeshares. Let’s take a look at some possible pitfalls so you can avoid them.
Timeshares originated in the 1970s in Hawaii. In the beginning, most timeshares were deeded timeshares. With a deeded timeshare, the owner owns the deed to a specific property for one week, or interval, each year. In addition to the purchase price, owners pay annual maintenance fees to cover basic upkeep, repairs, and housekeeping as well as occasional special assessments to cover major upgrades, repairs, or budget shortfalls. A deeded timeshare typically comes with a contract in perpetuity, meaning it lasts forever and can be passed on to your heirs. These timeshares solved two problems: they made money for developers and they allowed people to buy vacation properties who could not otherwise afford it.
However, developers still wanted more revenue and as the marketplace changed, buyers wanted more flexibility. So, the resort industry introduced many other timeshare models. These include floating week timeshares, right to use timeshares, points-based timeshares, vacation clubs, and more. Some of these products have shorter contract terms—the most common is 20 years—and not all can be passed along to heirs. Of course, all come with maintenance fees and special assessments.
So, what’s not to love? The industry adapted to meet the needs of the consumer, providing all kinds of products to make everybody happy. Sounds like a win, right? Unfortunately, for many timeshare owners, these solutions have brought even more problems.
Most timeshare contracts last between 20 years and forever. If you don’t think about the long haul, you could find yourself in timeshare trouble. Do you really want to go to this resort, this year, for the rest of your life? If you don’t, unfortunately, you’re stuck. What happens if your finances change? Will you still be able to afford the maintenance fees? What if the timeshare itself changes over time? Properties age and if they’re not well-maintained or if the company changes hands, will it still suit you? Long contracts can lock you in for the long haul, even if you want to escape. Carefully consider the problems with long contracts before you sign.
If you buy into points-based timeshare or vacation club, be ready to learn the ins and outs of travel hacking and online databases. If you aren’t tech savvy, you may have difficulty figuring out how to search for properties and dates or make your reservations once you find what you’re looking for. Plus, some systems add on fees at every turn. Don’t be surprised to pay a fee to join the exchange, a fee to make the reservation, a fee to talk to a person, or a fee to upgrade. If you’d rather spend your time on vacation instead of planning your vacation, a timeshare that requires you to make reservations might not be your best choice.
Sometimes resorts convert from deeded timeshares to points-based timeshares. And when they do, they encourage owners to convert, too. After all, deeded timeshares can only have as many owners as they have intervals. A resort can sell far more points-based timeshares. However, points-based timeshares aren’t always as good as deeded. If you have a great interval that works for you, you may not be able to reserve that interval after you convert to points. Plus, the value of points could change at any time. If the value of your points doesn’t keep pace with the cost of a stay, you’ll find yourself paying even more to stay in the same unit. Avoid the problem entirely and don’t convert to points!
You can pass some kinds of timeshares along to your heirs. But what if they don’t want them? In that case, they can refuse the inheritance. That is, unless you have added them to the deed. If they are on the deed, then they are on the hook for your timeshare, whether they want it or not. Sometimes timeshare companies will offer to add your children to the deed as a “convenience.” And that’s where people get into timeshare trouble. So, keep your kids off the deed and let them make their own timeshare decisions.
If you’re gotten into timeshare trouble and need a hand, we’re here to help! Contact us for a free, no-risk consultation today!
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