If you have a timeshare and are among the many people who are either struggling to make payments during the pandemic or are generally dissatisfied with the setup, getting out of the contract is a priority. Unfortunately, it is not always easy.
The Easy But Rare Solution: The Rescission Period
Many states have timeshare laws that give buyers a limited time to rescind the purchase and cancel the contract. This window is often very short, though: Massachusetts General Law Chapter 183B §38 only gives timeshare buyers 3 business days. Most other states provide about a week to rescind the contract, though, and it is usually the law of the state where the timeshare is located that controls. In Massachusetts, the 3 days begin when the contract is signed, or when the buyer receives the disclosure statement.
If you are still in the recession period, you can cancel the timeshare with a cancellation letter. If the timeshare or resort tries to ignore the letter or charge a cancellation fee, call a lawyer.
The vast majority of timeshare owners, however, have to take other measures to end their contract.
The Pricey and Risky Solution: A Timeshare Exit Company
Getting out of timeshares has become so common that entire companies have sprouted up to do it all for you.
Unfortunately, many timeshare exit companies are scams, including lots of the companies that only opened their doors when the coronavirus pandemic hit and created a flood of timeshare sales. Many of these shady companies require upfront payments of several thousand dollars before they do anything, and only then will they do what you could have done on your own or with the help of a lawyer.
Negotiating for a Timeshare Deed-Back
While most resort do not publicize it, there are usually ways to sell or give a timeshare back. The details and requirements tend to depend on the resort, though the owner generally has to be current on payments. Some resorts have special eligibility for owners in a financial hardship.
These negotiations, while they can be worthwhile, are tricky. Resorts are notorious for getting owners who are looking to sell their timeshare to purchase more, often by convincing the owner that having more equity will make it easier to sell.
Stopping Fee Payments
Some timeshare owners who are being stonewalled by their resort decide to stop paying the maintenance fee. In many cases, this only causes pain in the long run as the owner's credit rating suffers from the default.
However, if done wisely and if it is properly timed, withholding fee payments can be used as leverage while negotiating for a deed-back. If the resort thinks that you may be willing to take the credit rating hit, they may be more willing to negotiate.
Real Estate Attorneys at the Katz Law Group in Massachusetts
There are numerous factors that should be considered when deciding how to go about ending a timeshare. Going about it in the wrong way can end up costing even more than you would have spent on the timeshare, itself.