There are 1,580 timeshare resorts in the United States, a total of about 204,100 units. There are 9.6 million households in the United States that own one or more versions of a timeshare at an average price of $21,455.
While many enjoy their timeshare properties, others are not able to afford the increasing costs and feel frustration at not being able to schedule a time during prime weeks. Many now consider their purchase a huge mistake. There are limited options for those looking for a timeshare exit strategy.
One of the key problems with figuring out how to get out of a timeshare is being able to remove your obligations without ruining your credit. Read on to learn how to cancel a timeshare successfully.
Types of Timeshare Properties
The problem with trying to get out of a timeshare is they are difficult to sell. The depreciation value on a timeshare starts the second you complete the purchase. Older properties have dramatically less value than they did at the time of purchase, but annual fees are high and continue to increase. The most common timeshares are:
Fixed Week
With the fixed week timeshare option, you purchase a specific timeshare property or resort and use it the same one to two week period week every year. You receive a deed to your fraction of the property that is on record with the government.
While it may sound appealing to have the exclusive right to the property for a couple of weeks every year, the disadvantage is that you have an obligation to take your vacation at the exact same time every year. Trying to change to another time of the year may be extremely difficult.
Floating
With this option, you have a deed to your portion of a unit, but you have the ability to book it for any week during the year. The problem with this option is there are no guarantees you will be able to get the week you want because you will be competing with all other owners.
In this type of timeshare, you do not own the property, you are leasing its use for a specific number of years. The transfer or resale is more restrictive, and your ownership may have a lower value than if you have a deed to a portion of the property.
Right to Use
With the Right to Use form of a timeshare you do not own the property, you purchase a membership. The membership is a type of lease for anywhere from 10 to 50 years. The legal definition of your membership is personal property.
The timeshare unit is divided into “intervals” of weeks and/or points, and your membership allows you to use the unit for your specific time period. You may or may not be returning to the same unit or resort each year. You will have an obligation to pay an annual maintenance fee.
Point-Based
This style of a timeshare is through the purchase of an allotment of points that you are able to use at several locations, depending on your total point accumulation. The points allow for timeshare exchanges between resorts, providing more vacation location options.
The problem is you are competing with numerous other timeshare owners for locations, so obtaining a reservation when you want it may be difficult.
10 Timeshare Exit Strategies
Your commitment to a timeshare is often lifetime, and benefits that were sales strategies become burdensome. There are ways to eliminate the commitment, but you may need professional assistance for it to be successful.
1. The Problem With Inheritance
Many timeshares were sold 30 years ago with the “bonus” of your children being able to inherit it after your death. The problem is they also inherit the expenses that go along with it, such as annual fees. If the decedent doesn’t want the timeshare or is unable to afford the annual fees, their credit rating may suffer a negative impact.
Often beneficiaries of timeshare units they receive through inheritance consider ownership a hassle. If you are the recipient of this type of inheritance and do not want it, you may file a disclaimer, which then passes the timeshare to the next beneficiary under the will. In other words, you do not inherit the item.
This can be a smart financial strategy. The disclaimer means you have made a decision that you do not want to accept the inheritance. This allows you to side-step inheriting an undesirable piece of property that could end up costing you more than the profit you would render in its sale.
The disclaimer, once signed, is irrevocable so make sure you have given it proper consideration. You may wish to seek legal advice on the benefits and ramifications of such a decision.
If you are inheriting a timeshare, you may also call the home resort and inform them that you are giving the deed back to them or selling it back, that you do not want it. The timeshare cannot go after you for violation of the contract because you are not the original buyer. However, the timeshare may file a claim against the estate, so taking that step may backfire.
2. Determine Timeshare’s Value
To find out what your timeshare is worth contact a no-upfront-fee listing company to determine the timeshare’s value. You may then contact the timeshare company to see if they will assist you in selling your interest in the property. If they will not help, they may have a list of brokers who can provide assistance in renting or selling the property.
3. Resort Company Take-Back Program
Some timeshare companies are developing programs that allow owners in good standing with a clear title to exit their timeshare. It is worth asking the timeshare company if they offer this option.
According to the American Resort Development Association (ARDA), as of February 2020, the following timeshare developers were offering “take back” or “deed back” programs:
- Capitol Vacations
- Club Wyndham
- Diamond Resorts
- Hilton Grand Vacations
- Holiday Inn Club Vacations
- Orange Lake
- Hyatt Residence Club
- Margaritta Vacation Club by Windham
- Marriott Vacation Club
- Shell Vacation Club
- Sheraton Vacation Club
- Bluegreen Vacations
- Vistana Signature Experiences
- Welk Resorts
- Westgate Resorts
- Westin Vacation Club
- WorldMark by Wyndham
If you are a member of any of these you have the option of handing them the deed to the property back, but prior to taking that step, it is wise to consult with a timeshare exit company to see what your other options may be and whether you have a chance of recouping at least part of your investment.
4.Title Transfer Service
A timeshare title transfer assists timeshare owners in legally transferring the title for the property out of their name. Once their name has been removed from the title, they have no further financial liability for the timeshare.
To be eligible for a timeshare transfer you must have a clear title of ownership. There can be no mortgage still due to the timeshare.
5. Sell the Property
Normally the resort development association will have a list of brokers who are licensed to help with the selling and renting of the timeshare property. There are a lot of scammers that pose as timeshare re-sell companies. To protect your interest:
- Be cautious of the company guarantees a fast sale
- Avoid any company that requires a large up-front fee
- Check for complaints against the company by contacting the Better Business Bureau, consumer protection agency, and your state attorney general’s office
- Hire an attorney to review all contracts before signing
The alternative is to put your timeshare up “for sale by owner” which eliminates the brokerage fees but leaves you with the legal obligation of making sure that all ownership transfer is handled in accordance with the timeshare’s requirements.
The use of an attorney to review all documents provides you with peace of mind that the agreement is in your best interests.
6. Hire a Timeshare Exit Company
With people experiencing financial difficulties due to the pandemic there are many scam exit companies popping up throughout the United States. When considering any timeshare exit company consider the following:
- How long has the company been in business—in excess of five years is a good indication of a solid, reputable company
- What type of guarantee do they offer?
- How do they plan to back-up any guarantees they make?
- Do they have positive reviews from prior clients?
When you hire a company that knows how to cancel a timeshare you achieve financial release from the timeshare obligations while preserving your credit rating from the financial ramifications if you are unable to pay the timeshare fees.
7. Stop Paying Fees
According to the American Resort Development Association, the average timeshare annual maintenance fee is $980. If major repairs need to be made to the unit you may receive an assessment fee to pay. The contract may also contain a provision requiring you to pay property taxes.
Stopping the payment of fees is a technique many timeshare owners use hoping that it will help end their contracts. The problem is the timeshare companies will report you to the credit bureau, so you still have the obligation and your credit rating is negatively impacted.
This technique may end in one of two ways. There are occasional companies that will eventually fold and take the timeshare back. It is more likely they will sue you for the past-due fees, leaving you with the expense of attorney fees plus overdue maintenance charges.
8. Timeshare Mortgage Cancellation
This is a service in which your timeshare exit company works with you for the purpose of canceling your timeshare mortgage. Lonestar Transfer has been able to legally clear timeshare mortgages for more than 11,000 individuals.
What has been found is that often the buyers of timeshare property are told misleading information or not provided with full disclosure, breaking consumer protection laws. These errors provide you with grounds for cancellation of your timeshare mortgage.
9. Timeshare Contract Cancellation
Having helped more than 2,500 people obtain release from their timeshare contract is what led to Lonestar Transfer receiving the Rockwell Chamber of Commerce’s “Emerging Business Award”. Reasons you may be entitled to a contract cancellation include:
- Being told you would receive tax benefits for purchasing a timeshare
- Failure to provide you with the mandatory 3-day rescission period
- Failure to advise you about the fees and limitations regarding worldwide redemptions and exchanges
- Failure to provide you with your gift if you did not purchase the timeshare
- Sales staff’s use of high-pressure sales techniques including fear and intimidation
If you have encountered any of the above you need to contact a reputable timeshare exit company and schedule a consultation.
10. Hire an Attorney
If you are beyond the recission period for your contract you may need to take legal action against the developer. Legal action is a last resort, as you are then paying attorney fees in what may be an extensive lawsuit. If at all possible it best to contact a timeshare exit company to get all your questions answered before taking legal action.
One thing to be aware of is that if you have upgraded your timeshare contract there may be numerous contracts you need to cancel in order to be completely relieved of your obligations. A professional who specializes in timeshare exiting will be necessary for fighting this type of contractual obligation.
Why You Need Lonestar Transfer
Lonestar Transfer headquarters is located in the heart of Texas and provides customer-oriented service which includes:
- Assistance with ending all vacation club contract liabilities
- Assistance with ending all timeshare contract liabilities
- Assistance with the elimination of maintenance fees and special assessments
- Assistance with timeshare exits that include a written guarantee
- Removal of the risk your children will inherit a burdensome timeshare from you
- No cost, no obligation, private consultation
With more than 13,000 satisfied clients and a 100% money-back guarantee, you can’t go wrong.
Contact Lonestar Transfer today at (855) 722-3166 or use our convenient online form to ask a question or schedule an appointment to discuss your timeshare exit strategy.
