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Blogging for Change Blogging For Change
by sitecore\kmcgrigg on March 14, 2011

One of my favorite features of is the ability for consumers to submit questions and receive a personal answer via email. Our Ask the Experts column has been running for many years and in that time we have answered thousands of questions related to credit, debt, and money management. Recently, I received an interesting question regarding a timeshare property.

Question: I own a timeshare that I cannot afford. The maintenance fee is $735 yearly. I have not paid it for this year, and they will not help me resell it. I will retire soon and flat out can't afford it then. Can you suggest how to get out of it, and or deal with them. I have contacted timeshare resell company's, but they want $300 to $400 up front to sell it. (I don't have the money to do this either.) I have asked everyone I know to purchase it, but no buyers. What happens next?

Answer: I’m sorry to read of your situation. I am not an attorney, but I will try to explain how the process works.

Even if your timeshare is paid off, I understand that not paying maintenance fees is treated the same way as not making a mortgage payment. If the developer won’t take the property back, the best options I know of are to sell the timeshare or pay it off and donate it to charity. If these options are not feasible, the timeshare company may be willing to establish a repayment plan—even letting you stop payments for some period of time. If a repayment plan isn't negotiated, the timeshare company might go the route of taking you to court for breach of contract to get a judgment against you and place a lien against the property. Ultimately, they will foreclose on the property.

In general, regardless of whether a consumer has a timeshare that is a right-to-use or deeded timeshare, they are both treated as real property.  However, timeshares are governed by state law, so the timeshare foreclosure process varies from state to state. There may be differences in foreclosure processes depending upon whether the state is a judicial or non-judicial state. Florida, for example, just passed a timeshare foreclosure law (HB 1411) that streamlines foreclosures in that state to less than 90 days to help those who cannot pay on their timeshares from incurring fees during a protracted foreclosure process. Florida is a judicial state, but they are allowing timeshare and condominium foreclosures to bypass the judicial process and complete a trustee foreclosure (non-judicial) reducing the foreclosure timeframe from 18 months to 90 days.

If it gets to the point of foreclosure, you could try pursuing a quitclaim deed or a deed-in-lieu of foreclosure. It is possible to do these with timeshares, but not all timeshare companies will agree to them. It will depend upon state law and the timeshare company’s willingness to accept a quitclaim deed or deed-in-lieu of foreclosure. Also, some states require mediation prior to foreclosure so you should check in to that option as well.

To better understand your rights and responsibilities, I recommend you talk to an attorney or legal aid in the state where the timeshare is located. Also, you might wish to speak with an accountant or tax preparer to discuss any tax implications of a deed-in-lieu of foreclosure or quit claim deed.  You can learn more about your state's foreclosure laws by contacting your local consumer protection office. For a list of state and county consumer protection offices, please visit the Federal Citizen Information Center's website.

Best of luck to you.

If you have a question, check out our entire list of commonly asked questions and answers. If you cannot find an answer to your question, I encourage you to Ask The Experts.

This post was included in the Carnival of Personal Finance hosted by Fiscal Fizzle .


Agustina Hoffard says:
January 23, 2014

Time shares can become a huge financial problem for those who have bought one, and don’t know what to do with it. Should they sell it, donate it, rent it or cancel the contract? The truth is that the cancellation of the contract has always been the best and most viable solution to get out of a timeshare legally.

Ashley Murray says:
August 22, 2013

There are good timeshares out there, as well as there are people who feel happy about their timeshare purchases, especially those who enjoy to vacation at the same place and are not spontaneous travelers. Unfortunately, due to the big number of timeshare scams being committed against many vacationers, the industry has gained a terrible reputation.

Emili Gray says:
February 12, 2014

The timeshare industry has been into the lion’s mouth for the last couple of years, and it has generated lots of controversy and discussions in many forums and blogs on the web. However, since we’re living an economic downturn, anyone would expect that the timeshare sales collapse, but instead of that the sales seem to be increasing… but this comes with a trap: timeshare scams are increasing too. That leads us to the question: then, why keep people investing on timeshares?

Julia Myers says:
March 26, 2014

There was a time when timeshares became popular because they offered the opportunity to have ensured vacations each year for the rest of your life. Nowadays, timeshares have a terrible reputation and every day there are more timeshare properties that go back on the market. Selling a timeshare is easier said than done. It is a difficult process, which becomes even harder during times of economic downturn. Even so, we will give you some advices for you to know how to sell a timeshare safely, but without any guarantee.

Linda Rogers says:
September 06, 2013

Not all timeshares are bad, in fact, fractional ownership can be considered as a good option for some people, especially for big families who enjoy revisiting the same destination every year. Nevertheless timeshares are not for most people. Also, there are lots of timeshare complaints about the yearly fees and how it becomes almost impossible to pay them, being that they increase every year.

Mary Thomas says:
January 02, 2014

Timeshare fraud has been around since the timeshare idea was created, but they increase during poor economy. When times are difficult, timeshare owners are stuck with properties they can´t travel to or even afford. Desperate to recoup some money to pay for bills, they can easily become victims to scams artists pretending to be their timeshare salvation who will take upfront fees -as much as five number figures in some cases- but fail to fulfill their promise.

Tiffany Cox says:
August 25, 2014

Thousands of International travelers, particularly from the US and Canada, have fallen victims of timeshare fraud while vacationing. Resort developers hire skilled salesmen to represent their timeshares as many different attractive packages, such as financial investments, deeded properties, or vacation clubs, just to increase their sales.

TimeShare For Resale says:
June 24, 2013

Donating and selling timeshares are good options, just make sure you donate or sell to a company that will not rip you off! Good luck!

Vanessa Moore says:
May 28, 2013

I’ve always been wary of timeshares, and for good reason, apparently. The upside is that the cost of staying in a hotel includes room service, cleaning, etc – things you don’t get during your stay in a timeshare. I can see how it could be considered an “investment in lifestyle,” but that seems like a wasteful and silly way to spend my money. That’s just me.

Virginia Lewis says:
August 15, 2014

Probably the most viable option is to cancel your timeshare and check if any money can be recovered. Even there, there are companies who will -that might be linked to resell scams- that will claim to have experience and knowledge in the in and outs of the industry to help you recover your deposit.

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