This is a question owners ask that surprises me. Part of the timeshare presentation states you can use it, rent it, gift it, will it, or sell it. I left America almost 12 years ago, and I still remember a popular radio personality telling people, on air, that you can never get out of a timeshare contract. He would explain how you would be paying management fees forever.This would include you, your children, your children's' children and so on.
He would then give a commercial for a company in the Denver area.This company would give seminars showing owners how to get out of their timeshare. While at the seminar they would show how much money owners would spend paying management fees over the next 30 years. However, if you paid this company between $5,000 - $20,000 dollars they would take your timeshare and make sure you never paid management fees again.
I actually met a few guys that did the same thing in Spain and the UK. They thought, as I did, that it was amazing how people were gullible enough to believe this story. It was even more amazing that they would pay money and give away their property thinking it was the only way to stop the maintenance fee's.
So how can we sell or give away a timeshare we own? In America, you buy a fee simple ownership. This is an ownership forever or in perpetuity. You own it just like you own your home. You receive a General Warranty Deed, a Deed of Trust, and a Promissory note.
The Warranty deed is like the title to your car. The promissory note says you promise to pay the person or organization loaning the money for the purchase. The Deed of Trust basically says if you don't pay off the promissory note, the deed of trust gives the power to foreclose on the property. The Warranty Deed is recorded in a county court house and is given to you after the promissory note is paid in full. These are all very basic definitions. Always consult an attorney when it comes to matters of law.
Can I Sell My Timeshare?
One of the problems with selling a timeshare is that banks consider them a high risk loan. They generally have no interest in loaning money on them. This is why it's hard to get your money back and why it is impossible to make a profit. If your timeshare is paid in full , selling it for a small amount or giving it away is quite easy. If not, make sure the money you receive from the sale is enough to pay off the existing loan. You are the signer on the promissory note. Unless the new buyer can assume the existing loan, and odds are pretty good they can't, you are liable for the balance until the loan is paid in full.
Everything has been recorded in the court house of the county your resort is located. This is one way to help you sell. Go to the court house, obtain a list of all owners and get in touch with them informing them you have a week in that resort for sale. If you have a fixed week, your best prospects would be the clients that own the week before yours and after yours in the same unit.
You or your attorney can obtain a Quit Claim Deed. A Quit Claim Deed says you "quit" your ownership and all interest you hold in the property. A warning on this. A quit claim deed does not say you own anything, it just says you are giving all that you own of the property to someone else. If you are a buyer and the seller owns nothing, you own nothing. If you are concerned with this, pay the money to a title company. They can assure you of the ownership.
Take the quit claim deed to the courthouse and record it. The new owner will receive the original. You no longer own the timeshare, and are not responsible for any future management fees. It would probably be wise to contact the ownership company and let them know who the new owners are.They might have a fee for putting the ownership into somebody else's name.
You could also offer owner carry terms. Instead of the buyer paying the entire amount you're asking, you can "carry" the balance and allow them to make monthly payments to you. By doing this, you not only make it easier for someone to purchase your week, you also earn the interest a bank would earn if they loaned the buyer the money.
If you choose this method, you are still liable for the management fees if the new owner defaults on the loan or doesn't pay the fees. Please consult an attorney for a transaction such as this. If you purchased in the UK, it's very similar to the steps above. But again, please call an attorney to guide you through the steps. An attorney will ensure you are no longer liable for anything.
If you purchased a club the laws can be different. An ownership for a set number of years is called a leasehold estate. Contact the company you purchased from as they will have rules and fees to change the ownership name. You may still be liable for the management fee if the new owner does not pay.
Some companies are changing the rules for resales. They are not offering the same service or product if you purchase a resale. This is being done in an effort to stop resales. They want perspective purchasers to go to the timeshare company to purchase. At a starting cost of $20,000USD it's understandable.
This is wrong and these companies should be taken to court for these practices. Depending on the services taken away, it might not make a difference to someone paying a quarter or less of the price these companies charge. Again, always retain a real estate attorney and know the laws before doing anything. Better to be safe than sorry.
**Authors note: Timeshare is known by many names including but not limited to timeshare, timesharing, vacation ownership, holiday ownership, interval ownership, vacation insurance.
China in Pictures, Words, and Video - Follow the links to get your copy today