If you are ever approached to buy a timeshare, run screaming in the other direction. There is no upside to owning a timeshare, and if you are at all savvy with money you will be able to find a better way to take vacations than owning one of these money pits.
My wife and I were roped into a timeshare less than a year after we were married, and it has all been downhill since then. Though, for this little tale I will only start from the most recent situation. A couple of years ago we went to stay at a resort that was part of our timeshare. They, of course, invited us to a "90-minute orientation," which actually lasted much longer. They tell us the original company had been bought out and they were offering all the previous "owners" the chance to convert to the new point system. Which, of course, involves purchasing more points, and taking out a new loan to pay for those points. Also, instead of paying quarterly for our maintenance fee it was now going to be annual. Sounds all well and good, right? Easier to budget for, right? They also said our points would renew every year instead of every other year. Great idea, right? They also tell us that an awesome feature of a timeshare is it "can" be bequeathed to our kids. Great idea, right? Whose kids wouldn't want a timeshare they can use every year. Since you are buying into real estate it will just go up in value. Great idea, right?
Well, these little benefits are anything but. The maintenance fees go up every year. Yes, you will eventually pay off the loan for the points. That is if you don't get roped into buying more. You know, to make your vacations that much more awesome, because you can then stay either longer, or in nicer digs.
There are two major problems with purchasing a timeshare. Since you are buying points into a timeshare there really is no value, therefore, if you try to sell it you will never get anywhere close to what you paid. Just try looking around online for people who would be willing to buy a timeshare. They just are not there. And sure, there are services that will "help" you market your timeshare for sale, but they just take your money (the marketing fee) and never deliver. And that, ultimately, is the only way to get out of it. Or is it?
The other fallacy they try to use as a selling point (the whole bequeathing to relatives thing) is a total sham. You, the original purchaser, are the only one that has any kind of recourse to get out of the contract, if you choose to. Once you sign on the dotted line it is forever tied to your estate, which means whomever inherits your stuff will get the timeshare, whether they want it or not. Which means, against their will, or better judgement, they will be paying the maintenance fees on this awesome timeshare for as long as they live, or the timeshare goes out of business, whichever comes first. Then, if the timeshare company is still around, and your kids are not, then their kids will get it. And so on, and so forth, infinitum.
So, having come to our senses, we are currently in the process of getting out of our timeshare. I am not at liberty to say specifically how, but we are basically disputing the contract as we feel we entered into it under false pretences. But the great thing about this now is we are trying to buy a house. And this little situation could torpedo the whole thing as it is still counted against our debt to income ratio. So, unless we are able to decrease that ratio in someway our lender may pull out.
My advice to anyone who may be considering the purchase of a timeshare? Avoid it like the plague.
My wife and I were roped into a timeshare less than a year after we were married, and it has all been downhill since then. Though, for this little tale I will only start from the most recent situation. A couple of years ago we went to stay at a resort that was part of our timeshare. They, of course, invited us to a "90-minute orientation," which actually lasted much longer. They tell us the original company had been bought out and they were offering all the previous "owners" the chance to convert to the new point system. Which, of course, involves purchasing more points, and taking out a new loan to pay for those points. Also, instead of paying quarterly for our maintenance fee it was now going to be annual. Sounds all well and good, right? Easier to budget for, right? They also said our points would renew every year instead of every other year. Great idea, right? They also tell us that an awesome feature of a timeshare is it "can" be bequeathed to our kids. Great idea, right? Whose kids wouldn't want a timeshare they can use every year. Since you are buying into real estate it will just go up in value. Great idea, right?
Well, these little benefits are anything but. The maintenance fees go up every year. Yes, you will eventually pay off the loan for the points. That is if you don't get roped into buying more. You know, to make your vacations that much more awesome, because you can then stay either longer, or in nicer digs.
There are two major problems with purchasing a timeshare. Since you are buying points into a timeshare there really is no value, therefore, if you try to sell it you will never get anywhere close to what you paid. Just try looking around online for people who would be willing to buy a timeshare. They just are not there. And sure, there are services that will "help" you market your timeshare for sale, but they just take your money (the marketing fee) and never deliver. And that, ultimately, is the only way to get out of it. Or is it?
The other fallacy they try to use as a selling point (the whole bequeathing to relatives thing) is a total sham. You, the original purchaser, are the only one that has any kind of recourse to get out of the contract, if you choose to. Once you sign on the dotted line it is forever tied to your estate, which means whomever inherits your stuff will get the timeshare, whether they want it or not. Which means, against their will, or better judgement, they will be paying the maintenance fees on this awesome timeshare for as long as they live, or the timeshare goes out of business, whichever comes first. Then, if the timeshare company is still around, and your kids are not, then their kids will get it. And so on, and so forth, infinitum.
So, having come to our senses, we are currently in the process of getting out of our timeshare. I am not at liberty to say specifically how, but we are basically disputing the contract as we feel we entered into it under false pretences. But the great thing about this now is we are trying to buy a house. And this little situation could torpedo the whole thing as it is still counted against our debt to income ratio. So, unless we are able to decrease that ratio in someway our lender may pull out.
My advice to anyone who may be considering the purchase of a timeshare? Avoid it like the plague.
