If you’re stuck in a timeshare, you have a couple of options. Generally speaking, you can’t simply walk away from a timeshare, since you’re obligated for ongoing maintenance fees. Falling behind on maintenance fees or a loan payment often means calls from collection agencies and a hit to your credit score.
What Is a Timeshare?
Simply put, a timeshare is shared ownership of a property, typically a vacation condo or similar structure. In this arrangement, all owners have shared use of the property and all owners are responsible for maintenance of the property.
Reasons People Exit Timeshares
Generally regretting purchasing a timeshare seems to be the main reason that buyers back out. This can happen for multiple reasons, many due to a change in financial circumstances or tied to an overall lack of value in the purchase. A full 41% of buyers ended up regretting their decision even though they never thought they would. A further 30% were neutral prior to buying a timeshare, but then ended up regretting their decision.
Many times, buyers have wasted a considerable amount of money in these ‘investments,’ sometimes leading to bankruptcy. For most individuals and couples, bankruptcy comes down to a choice between Chapter 7 and Chapter 13. In most cases, filing Chapter 7 bankruptcy will be the buyer’s best bet. This form of bankruptcy is much quicker to file, filers can often keep all or most of their owned property, and they don’t have to pay creditors through chapters 13’s 3-to-5-year repayment plan.
How to Exit Your Timeshare Agreement
It’s been more than 200 years since the Constitution of the United States was created. Since that time, many laws have been enacted and repealed through a variety of means, and it can be difficult for a layperson to keep it all straight. Many people believe that they are legally bound to their timeshare for the foreseeable future, but the fact is that, in many cases, they may be able to separate themselves from it.
Under normal circumstances, there are three main ways to get out of a timeshare.
Sell It or Give It Back
It’s best to set your expectations low when considering selling your timeshare, especially in today’s rough travel climate. There are many websites out there that can help you negotiate your way out of your timeshare and help you find a buyer for it, but know that these methods can still be pretty complicated.
Often, you can negotiate your way out of a timeshare if you’re unhappy with it. Engage with your company and ask them about their exit options. Be aware, however, that there may be a fee to terminate the contract, sometimes in the thousands of dollars.
Hire an Attorney
If you’re outside of the cooling-off period and believe you have realistic cause for legal action against the company, then hiring an attorney is often your best option. Before you commit, however, it’s important to be clear on what you’ll be getting. Will paralegals send form letters on your behalf, or will the firm actively fight for you? Do you need them to fight, or do you feel that letters would be enough? Either way, be clear before you sign anything.
In the end, real estate can be a tricky and expensive world to learn in. Before you choose a company to work with on your timeshare exit strategy, first ask yourself a few questions. 1) Has this company been around and in business for at least five years? 2) What kind of guarantees does it offer its customers? And 3) Does it have a good history of positive reviews? If you can answer these questions to your satisfaction, then the chances are high that you’re dealing with a legitimate company and not one of the many scams out there. Just remember to do your due diligence before committing to anything.