Today’s timeshares are not the timeshares of your grandparents’ (or even your parents’) generation. The hard-sold, rigid plan of the past has been replaced with a points-based system offering options in a variety of enviable locales. Even those frequent naysayers who once scoffed at the shady, shared vacation home model are pausing to consider just what a 21st century timeshare could mean to them. But just because timeshare plans have changed doesn’t mean you shouldn’t think carefully before deciding to purchase one. If you’re contemplating buying a timeshare property, consider the following four facts before you sign on the dotted line:
Timeshare Is Not An Investment
This could be your vacation spot, but it won’t be your vacation home. A timeshare property does not appreciate like a traditional piece of property. Its value resides in your use of it and the memories you make while there. If and when you decide you need to sell it, you will be lucky to break even.
Price Is Negotiable
Despite the frenzied sales pitch and purported urgency a timeshare salesman might present to you, the price of a timeshare is almost always up for debate. If you are buying directly from a resort, you can frequently negotiate exchange programs, fee reductions and other incentives, but you will still likely pay more than if you look for properties for sale by current owners. Purchasing a timeshare from a current owner is a good way to save up to half or even more of the resort’s listed price.
All Timeshares Are Not The Same
Timeshares are not created equal. A timeshare in the United States is usually sold as a “timeshare estate,” which allows an owner the right to rent, sell, exchange and bequeath it. Outside the U.S., however, timeshares are often sold as an individual “timeshare license,” which only allows an owner the “right-to-use” the property for a specific amount of time. In addition, the purchase of international property is not covered under U.S. law, so if you have problems with your contract, you will not be protected.
Similarly, each timeshare contract will indicate differing maintenance and/or membership fees and rights for redeeming and/or sharing points and properties. You will need to thoroughly understand the responsibilities for which both you and the resort will be accountable.
You Have Rights
Yes, you have to sign a contract to purchase a timeshare, but you still have rights – even if you change your mind. Most U.S. states have laws that will protect you if you wake up with buyer’s remorse. These “rights of recission” protect buyers who decide they have made a mistake with their purchase and want to back out of a deal. The right to rescind the contract typically extends a week to ten days from the contract signing and covers any and all reasons. After that, legally terminating a timeshare agreement gets harder, but it is not impossible. Companies like Step Zero exist to assist owners with the cancellation of timeshare contracts.
Buying a timeshare can be a legitimate option for people wanting to possess their own piece of paradise. Just think long and hard before putting pen to paper, and make sure you are fully aware of all the legal and personal ramifications of timeshare ownership.