Every once in a while I get a question from a reader about how to get rid of a timeshare. Sometimes the person is asking for themselves, but other times, they are trying to help a friend or family member.
The problem is that timeshares aren’t as amazing as the salesperson claims they are. They are expensive, you probably won’t use them as much as you think, timeshare resale values are incredibly low making them hard to sell, and more.
So, if you have been thinking about purchasing a timeshare or if you are wondering how to get rid of a timeshare, today’s article is for you.
Many adults have attended a timeshare presentation, and even more have been asked to attend one. You are usually offered something if you stay the whole time, such as a free vacation, an iPad, a cruise, or something else that is quite enticing. And, that’s how they get you interested.
All you have to do is listen to the presentation and get your free gift. Sounds simple enough, right?
But, after sitting through the timeshare presentation and listening to the salesperson talk about all the “benefits” of owning a timeshare, you may be intrigued.
Even though you told yourself that you weren’t going to purchase anything, the salesperson is well-trained and you can’t resist something that seems like such a good deal.
Many people cannot say no in these situations, and that is why around 10,000,000 households in the United States own a timeshare.
I had no idea that the timeshare business was this large. Maybe I’m missing something, but the negatives that I’m going to explain in this article seem to significantly outweigh the positives. I’m honestly shocked that there are that many timeshare owners out there, and many sadly end up regretting their purchase.
One of the issues with timeshares is that there are different types, some of which you pay for but never actually own. Those are called non-deeded timeshares, and they fall into two categories:
- Right-to-use systems- You sign a lease from anywhere from 20 to 99 years and pay for the right to use the timeshare. It would be very difficult to sell something you never own.
- Points-based system- You purchase points each year to trade for reservations at different properties owned by a timeshare company. Some companies let you “bank” points that can be rolled over to another year.
There are also timeshares called deeded timeshares. With these ones you share ownership of the timeshare with other people. These usually fall into two categories:
- Fixed-week system- You get to use the timeshare for the same specific week each year. That means you will have to be available that same week every year.
- Floating-week system– Same as above, but the difference is that you get to pick the week you use your timeshare. You may compete with other people for busy weeks or seasons.
Lately, I’ve been hearing about more and more people buying timeshares. It’s been brought up by my readers, in my Facebook group, and by my friends. But, at the same time, I have seen more and more people asking how to get rid of a timeshare.
Someone I know spent $15,000 on a timeshare. I know of another person who has bought multiple timeshares with their student loans.
I also once read a post on Facebook that said, “Please, help me sell my timeshare!” This person was trying to sell their timeshare for $1 and there weren’t any offers yet. They were looking to Facebook as a last resort and wanted friends to share their post.
Sure, I have an open mind and perhaps sometimes timeshares are an okay idea, so I won’t completely discredit them. However, I’ve never met someone who bought a timeshare and was happy with their purchase years down the line.
I’ve only heard horror stories about timeshares.
Due to this, I’ve never really understood the appeal of timeshares.
And I’m not sure I ever will.
I’m not writing this post to offend anyone. Like I said, I’m sure there are cases that exist where someone has found a great deal on a timeshare and they know they’re going to actually use it. I won’t ignore the possibility of that. However, I know that each and every year many people buy timeshares thinking they are a great deal when in reality most of the time they are not.
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In today’s post, I’m going to talk about why you should skip the timeshare, as well as what to do if you already own one and are looking for a timeshare exit.
Below are 5 reasons not to buy a timeshare.
1. Timeshares are expensive from Day 1.
Timeshares are expensive.
Even the people who’ve bought them told me that their number one hesitation was price, and it goes beyond the upfront cost.
Actually, many people end up taking loans out for their timeshares. This means that your timeshare might end up costing two or even three times the cost over the duration of the loan due to interest.
If you are buying a timeshare, then the cost of owning one is the main upfront costs being the lump sum price you pay to “buy” it. Then, there are also the interest fees if you are using a loan to buy your timeshare and also closing costs.
According to the American Resort Development Association, the average price for a one week timeshare is approximately $21,455, with an average annual maintenance fee of around $700 on top of that.
That is a lot of money. No wonder so many people want to learn how to get rid of a timeshare.
2. Timeshares have expensive annual maintenance fees.
Maintenance fees are something that you’ll have to pay if you own a timeshare, and you’ll pay them every year for as long as you own the timeshare. This annual fee is to pay for the cost of operating the resort. This covers the general upkeep up the timeshare property, landscaping, utilities, staffing, plus more for future upgrades and repairs.
As I said earlier, the average annual maintenance fee on a timeshare is around $700, and in many cases it can be over $1,000 a year depending on your timeshare agreement. I did some research and found some timeshares that had annual maintenance fees of over $2,000 a year.
Maintenance fees need to be paid year after year, regardless if you use the property or not. If you stop paying them, the resort your timeshare is at can begin the collections process. This can cause long-term negative effects to your credit score and finances.
Also, the annual maintenance fee can increase over time as well, in many cases, at a rate that is higher than inflation. It can more than double in just a few years, and there is no cap on how high a resort or timeshare company can raise your rates.
This is the number one reason that so many people want to learn how to get rid of a timeshare.
3. Timeshares are near impossible to sell.
If you want to learn how to get rid of your timeshare because of the high annual cost, you are tired of paying monthly payments on your loan, or if you simply just aren’t using the timeshare, you will have a hard time selling it.
Timeshares do not appreciate like normal property does. This is another reason I do not think they are suitable for the average household.
You know that person that I said was on Facebook trying to sell their timeshare for $1? That is not uncommon at all.
If you do a quick search online, you will find hundreds of timeshares going for just $1.
If they are such a great deal, why are people trying so hard to get rid of them?
Like I said, the number one reason that people want to sell their timeshares is because of rising maintenance fees. You hear one price when you are sold your timeshare, but the costs keep increasing making it harder and harder to budget for.
This is why people want to sell their timeshares for so cheap – anything to get out of the constant and increasing costs.
Because there are so many people trying to sell timeshares without any luck, there are companies popping up all over the internet claiming to help people get out of timeshares. However, many of these companies are scammers. This presents another danger to consumers who have purchased a timeshare.
4. You may not use the timeshare as much as you think.
When you purchase a timeshare you probably think that you’re going to use it every single year. You might even laugh at someone who says you’ll eventually want to learn how to get out of a timeshare.
You tell them and yourself it will be an easy way to go on an inexpensive vacation and that you’ll actually save money. However, there are many reasons why you might not use your timeshare every year, which then becomes a waste of your money.
Maybe you have a bad income year and can’t afford to travel to your timeshare, an emergency comes up, you want to take a vacation somewhere else, etc.
And, whether you use your timeshare or not, maintenance fees need to be paid year after year.
For every year that you don’t use your timeshare, that’s more money you’ve invested in it with no return, not even a fun vacation. Really, there are much better ways you could have invested your money.
5. You have plenty of other options for your vacation.
Timeshare salespeople try to find buyers by claiming that timeshares are a great way to save money on a vacation. They tell you that every year you’re going to be able to visit this beautiful place and that it will actually save you money.
I do not understand that.
Spending $20,000 or more on a timeshare where you only get around one week annually seems very expensive. In some cases you may struggle to get the week of your choice. And, don’t forget the maintenance costs!
There are PLENTY of ways to go on a more affordable vacation. You could shop around for the best prices on hotels and flights, use credit card rewards, visit during the off season, bundle your trip, and more. I’m sure you could spend less on an annual vacation than what it would cost to own a timeshare.
Plus, if you are still wanting the “timeshare feel,” you can rent timeshares from other owners for a FRACTION of what they have paid. You can usually find them for a couple hundred dollars per week, whereas the owner is still paying the maintenance fees each year that are most likely twice or three times as much.
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Have you ever been to a timeshare presentation? What do you think of timeshares?
The post How To Get Rid Of A Timeshare – Stop Wasting Your Money! appeared first on Making Sense Of Cents.