If you’re considering a timeshare, or if you’ve recently bought one, it’s not hard to see the appeal. Though Americans haven’t returned to the $1.2 trillion we spent on travel before the pandemic, the vacation industry is slowly springing back, and there’s nothing like a timeshare to bring visions of sandy beaches, resort towns, and winter getaways.
Of course, those fantasies don’t always match the financial reality of timeshare ownership. For new owners, it’s not uncommon to research how to cancel a timeshare contract soon after the purchase!
Getting out of a timeshare contract can be expensive, confusing, and tricky, but it’s not an impossible feat. If you want to get rid of your timeshare, here are a few tactics worth trying.
Cancel During Your Rescission Period
The best way to get rid of a timeshare is to cancel early. The Federal Trade Commission requires timeshare companies to give new owners a “cooling-off period” of at least three days. During this time, owners who get cold feet can cancel a timeshare with no strings attached.
This cooling-off period, also called a rescission period, will vary from state to state. Some states stick to the three-day rule, while others offer new owners a week or more to cancel.
The biggest benefits of cancelling during this period are twofold. First, this is the only way to get a full return of what you paid. Second, you don’t need to dig into your contract or find a reason for cancellation: you have every right to change your mind.
However, if you’re going to get your money back, you’ll have to work fast. Cancelling during this timeframe means sending a written letter of cancellation to your resort.
This letter doesn’t need to be fancy, but it does need to have some key details. You’ll need to include things like a description of the timeshare, the date you bought it, and a statement that you want to cancel. Look at your contract for specific requirements.
It’s a good idea to send this letter by certified mail. This gives you proof of both the date you mailed it and the date the company received the letter.
Find Grounds for Cancellation
What happens if the rescission period is already over? If you’re lucky, you might still be able to find grounds for cancellation in your contract. Timeshare companies design these documents to be hard to get out of, so you’ll have to go through each detail with a fine-tooth comb to see if you have a legal reason for cancelling.
Sometimes, you can find evidence of fraudulent behavior. Here are a few worth considering:
- Lies about fees or interest rates
- Hidden limitations, such as blackout dates that weren’t disclosed up front
- Claims that timeshares offer tax perks, which is not true
- A promised gift or bonus that you never received
In addition, you may be able to get out of your contract if the company used intimidation tactics to sell to you.
If you feel like you’re a victim of fraud, now is the time to contact a reputable timeshare law firm. Timeshare lawyers can help you understand whether you can make a claim based on the details of your specific contract and situation. If they can help prove that your contract is invalid for some reason, you may be able to cancel your contract, get your money back, and even get compensation.
Use Your Developer’s Exit Program
Not all developers offer options for exiting a timeshare, but a few reputable ones do. Check to see if your developer has a formal exit program for timeshare owners who want to give up their property.
Even if your chosen company doesn’t have a listed program, you can still reach out to ask about buybacks: the worst they can say is “no.”
Note, however, that even formal programs tend to be discretionary. This means that the timeshare company gets to choose whether or not it will take the property back.
Resale Assistance Programs
In some cases, a timeshare company may offer a “resale assistance” program. This means that they’ll help you list your timeshare for sale.
However, most companies will continue charging you fees during this process. They may even tack on additional fees for their help with the sale.
Deed Back Programs
If the timeshare company offers a “deed-back” program, it means the company will take your timeshare back for free.
In other words, you’ll forfeit your equity, but you won’t have to pay future fees. However, some companies may require you to keep paying your annual fees until they have found another buyer.
Check your contract for a deed back clause to see if you meet the conditions for this option. Often, developers won’t allow you to take this exit option if you’re behind on payments.
Many timeshare owners balk at this choice, as it means losing their initial investment. However, this is far better than continuing to pay annual fees! A deed back program can mean saving thousands of dollars across the span of your ownership.
Partner With a Timeshare Exit Company
If the options above don’t work for you, it may be time to get in touch with a timeshare exit company.
It’s important to be careful with this. Unfortunately, some timeshare exit companies are just as likely to scam you as your developer is! Because they know that new owners are often desperate to get out of their timeshares, they’ll take advantage while using fear-mongering and high-pressure tactics.
In other words, do your homework. Look for a company that has been in business for at least five years, look at their online reviews, and check for a money-back guarantee.
Reputable timeshare exit companies may help you in several ways. They can negotiate with developers and help you cancel your mortgage.
In addition, they can help you transfer your title, which is often the easiest option. If you have a friend or family member who is interested in your timeshare, or if you’ve found a buyer through an online marketplace, a timeshare transfer company can help you with the paperwork. This transfer can help you avoid any additional fees.
Note that the details of your solution will depend on your situation, preferences, and financial standing. You should always expect a personalized plan from a timeshare exit team, as there’s no one-size-fits-all solution to getting out of a timeshare obligation.
Donate Your Timeshare
This option is often a last resort, as few legitimate charity organizations are interested in timeshares. Because timeshares depreciate over time, and because they will require the charity to pay fees after the donation, many organizations won’t accept them.
In addition, keep in mind that you can’t donate a timeshare if you haven’t yet paid off your mortgage in full. You may also have to get a private appraisal of your timeshare to determine its value.
To donate your unwanted timeshare, find a charity that is willing to accept it. We recommend looking for reputable charities that are transparent about their financials. You’d be surprised how many timeshare-related scams exist, even when it comes to timeshare donations!
If you find a reputable charity, the process can often be faster than the process of selling a timeshare. Even better, most charities can help take care of the title transfer on their own. However, you should still expect to pay fees until the donation is complete.
Stop Making Payments
While this is technically a way to get out of your contract in the long term, we don’t recommend this course of action unless you have no other options.
If you stop paying your annual fees and loans, a few things can happen.
First, you can expect your credit score to fall. Timeshare companies often partner with collection agencies that are happy to chase after you for the money you haven’t paid.
You’ll also open yourself up to the chance of foreclosure. Worse, if the resort files a lawsuit, you may be on the hook for legal fees and other costs. Wage garnishment is also a possibility.
In some cases, however, timeshare companies won’t be willing to go through all this trouble. Instead, they’ll accept your surrender of the property and spend their efforts on remarketing it instead of chasing after you for payments. Of course, it’s hard to tell when a resort will choose this option, so we don’t recommend taking the chance!
Filing for bankruptcy can make it easier to stop making payments. This isn’t the right solution for everyone, and it has its pros and cons, but it can put an end to collection activity and help you get rid of debt.
Know How to Cancel a Timeshare Contract
Here’s the bottom line: if you’re considering buying a timeshare, it’s important to know how to cancel a timeshare contract as well. Backing out of your mortgage isn’t as easy as returning an unwanted shirt at the store, and it pays to understand what you’re getting yourself into if you change your mind!
If you’ve already bought a timeshare and need help getting out of it, we’re here to help. Lonestar Transfer has gotten thousands of happy customers out of their timeshare obligations, and we’re ready to work with you as well. To learn more about what we do, contact us today for a no-risk, free consultation.