US Timeshares

Joan Lee Tu

Inspired Forum Member
REIN Member
I have a friend in Alberta who bought a US timeshare, financed the purchase, has money still owing and is now having to cut back on necessities like food to keep up to date on the timeshare loan/maintenance payments. Can anyone offer some insight on how to deal with this situation or dispose of US timeshares?
 
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Thomas Beyer

Senior Forum Member
REIN Member
Is this a US loan ? If so, it will be difficult to collect !



Likely they will foreclose on the timeshare as it is usually registered like real property. Likely also not much will happen if he defaults on payments besides nasty letters and nasty phone calls. It may be difficult for him to get US financing in the future.



IRS or US customs doesn't care about this.



I bought two time share weeks for $800 each a decade or so ago, but even so I think I will dump mine due to ongoing and ever increasing maintenance fees, although we got some decent cheap use out of it in a number of countries. Resale timeshares can be great bargains if you like to travel to new places and buy them for a song (and not for $30,000 like some command for a week). But generally it is a way for developers to defray development and especially ongoing maintenance costs.
 

Thomas Beyer

Senior Forum Member
REIN Member
[quote user=joanhlee]This can be a real stressor for Canadians who buy US timeshares...


self induced stress .. no one is forced to buy them !



Several firms offer to buy them .. likely at a 50-90% discount to retail value !



As stated, buying timeshares used, at a steep discount, may make sense for some. Of course, due to high maintenance fees, some are overpriced even at $1.
 

Airbender

New Forum Member
REIN Member
I have experience, I hate to admit. Though it is a bit dated, I think it is still valid. My wife and I were warmed before we got on the plane to Cabo back in 1996 and the cabin crew on the plane warned us before we landed in Cabo. We arrived fully armed and prepared to ward off any and all attempts to get us to buy, or so we thought. All I can say is - they are very good at what they do!



After three years of ownership, the purchase plus maintenance totaled approx US$11,500. We could see the writing on the wall that it was a bad purchase and sold it through a resell company for US$1500. I now consider that as a $10,000 education course from the school of hard knocks.



ThomasBeyer is right - no one forces you to buy. But rather than defaulting and possibly setting themselves up for trouble down the road should they decide to purchase other property in the US, I would strongly recommend your friends swallow the bitter pill, put it through a resell company and take whatever they get to go buy a hang-over so as to speed moving on. They come away with a clean record and at least a few dollars in their pocket.



To finish the story, we signed the papers to purchase on day three of seven of our holiday. Buy remorse hit me within hours, totally ruining the remainder of our holiday. We purchased on our Canadian visa card, so walking away from it was never an option. We never did returned to Cabo. Our purchased week ran Wed to Tues, perfectly matching our flights that year, but the following year, the cheap flight down arrived/departed on Fridays! Never thought about that before buying.



Good luck to your friends. They have my sympathy.
 

Jed

Inspired Forum Member
Registered
Hi,



We just purchased a timeshare basic membership from Diamond International last November. My husband and I had never been sucked into this type of purchase. But thinking that we can spend some time away each year with the family with a schedule appealed to both of us at the time since we would hardly take vacations if we were not forced to. And so we bought the basic membership for US$11,500. Each year, there is a maintenance fee of about $1000. In March we went to Las Vegas using one of the promotions they offered. There, we found out our basic membership does not even have enough points to go anywhere for a family of 5 for one week. We were so angry since that's not the story told to us when we were contemplating on the purchase. We are planning to complain to the president of Diamond International. We don't want to resell it at a substantial loss. Does anyone have any suggestions on what we should do?



Thanks/Jed
 

Thomas Beyer

Senior Forum Member
REIN Member
[quote user=Jed]Does anyone have any suggestions on what we should do?
Read the contract more carefully next time, research more online first, accumulate points, take a vacation with them every two or 3 years, book the investment under life's asset column under "education" or "life's experiences" .. and move on with your life !

$11,500 for a week, i.e. 1/50's of a condo i.e. $500,000 plus $50,000 condo fees/year for the full year equivalent: does this sound like good value to you ?

I used to own 2 weeks bought for less than $900 each. Even with only $250/year maintenance fee we decided to sell.

Timeshares make sense if
a) you go to the same resort every year, around the same time and really love it
b) if you like to travel, buy them really cheap and don;t mind exchanging them for whatever is available in your off-peak travel.
 
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Colin Forrest

Investing with Integrity
REIN Member
Fortune Magazine and the Motley Fool recommended "sellmytimesharenow" as one of the better companies to use. I've had my timeshare on their inventory list for ages but thus far no takers. If memory serves me, the cost of the service is $1000. We still manage to get some value out of our timeshare, but knowing what I know now, I probably wouldn't spend my money on one again.
 

maver1ck

New Forum Member
REIN Member
I have a US timeshare as well and I could not sell it as well. Years back I tried a service for selling but after collecting an upfront fee I never heard from them again. Can anyone recommend a reseller? Is it normal to collect the fees upfront?
 

Dan 7612

Inspired Forum Member
REIN Member
I own three timeshares (as points vs hard weeks). Before you shake your head - I travel quite a bit for my full time job and have 9 weeks of vacation. I like to add time for vacation as part of my business trips. I found that traveling during non peak time I can roll those three timeshare to the equivalent of 6-8 weeks if not more.

I purchased my timeshare off eBay for less than <$50 each with maintance fees of less than $700 per year. One in Las Vegas - week 52 (New Years ($375 maint fee), One in Orlando - week 51 (Christmas $700 maint fee).

I can't use all of the weeks every year when traveling off peak - so what I do to cover my costs is that I donate a week to three local charities at a resort north of Toronto - in exchange for the week donation, the charities give me a chartable donation receipt. The receipts cover the cost of the maintenance fees.

One of the charity auctions off the week and typically raise $4,000

So if your really stuck in covering the costs - this is an option that helps both you and the charity.

If you do want to sell then I suggest you head to the website "Timeshare Users Group" and learn all you can. They have a section for selling and buying.

http://www.tug2.net/
 
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