Almost 10 million American families own timeshares. Many of those owners deeply regret their purchase. It isn’t hard to see why.
On average, timeshare prices start at over $20,000 for a single week’s use of the timeshare each year. Maintenance fees tend to go up at least five percent year-over-year. With numbers like those, the costs add up much faster than the benefits.
But getting out of a timeshare can be tricky at best. If you’re looking to get out of your timeshare, here are six timeshare laws you need to know about.
1. You May Have the Right to Change Your Mind
In every state but North Dakota, consumers have the right under law to change their minds about contracts they’ve signed. Sometimes called “cooling off period” statutes, these laws are designed to help consumers who have been bullied or psychologically trapped into making purchases they do not want or cannot afford.
Depending on your state:
- You may have between 3 and 15 days to cancel your contract without penalty
- The “cooling off” period may begin the date you sign your contract or the date certain mandatory disclosures are made
- Other special protections may apply
Timeshare buyers in every state may also find quick-cancelation clauses in their contracts.
If you have just purchased a timeshare, check your contract and the laws in your state. You may be able to cancel your purchase for free if you are still within the cancellation window.
2. Your Timeshare Has No Legal Value
When you purchase a house or condo, you gain legal ownership of and responsibility for the property. While this means that you have unpleasant duties like paying taxes on the property, it also means that you gain the financial worth of the property as an asset. You can then borrow against that value or sell the property and use the proceeds to purchase other assets.
When you purchase a timeshare, you are purchasing rights to the use of the property but nothing more. Your purchase does not deed to you any portion of the property, and therefore it has no legal value. This means that you cannot:
- Borrow against it
- Liquidate it
- Write it off or take deductions for it for tax purposes
This leaves many timeshare owners trapped in worthless contracts they must pay thousands of dollars per year for.
3. You Are Still Responsible for Your Timeshare (and Its Fees) Even if You Sell It
Under standard timeshare contracts, you remain responsible for your timeshare’s fees even if you sell, rent, or donate it. Forever.
If at any time the person or organization to which you transferred ownership of the timeshare does not pay the associated fees, you are still on the hook for them. Nothing you can put in your sale contract will negate this basic fact of timeshare law.
4. Timeshare Companies Can’t Lie to You (but Yours Probably Did)
The Federal Trade Commission regulates the sale of goods and services within the United States and takes action against fraudulent operations. While timeshares themselves are legal, timeshare companies often engage in illicit sales practices including:
- Failure to inform you of vital information related to the sale such as timeshare maintenance fee laws
- Failure to explain the lack of resale value of your timeshare purchase
- Failure to provide you with adequate time and opportunity to review and question the contract
- Salespeople lying about personal experiences with the product
These dirty practices routinely cause buyers to purchase timeshares they otherwise would not have.
6. Business Rankings Can Be Bought
Many consumers mistakenly believe that the Better Business Bureau and organizations like it are government-run. As such, they assume that the rankings these organizations give businesses are:
In reality, the BBB and similar organizations are independently owned and operated. While they may provide a service, companies can readily buy their way into a good rating or ranking regardless of the actual quality of their product or service.
Timeshare companies are a prime example. Too often, their rankings are misleading and result in pushing buyers toward purchasing timeshares under false perceptions of safety and respectability.
7. Timeshare Resale Companies Are a Scam
Per your original timeshare contract, you are legally responsible for your timeshare and its fees in perpetuity. Under current timeshare resale laws, this does not change even if you transfer legal ownership of your timeshare to another person or organization.
Timeshare resale companies promising to get you out from under your timeshare by selling it to another buyer cannot legally make good on that claim. It just isn’t possible under existing laws.
Making Timeshare Laws Work for You
At first glance, learning facts like these about timeshare collections law can seem overwhelming. More than one timeshare owner has expressed a fear that they will be saddled with their unwanted timeshare and its ever-escalating fees until the day they die.
But there is good news.
Understanding timeshare cancellation laws is the first step to getting out from under your timeshare for good. Armed with the knowledge of these six laws, you can:
- Avoid getting scammed by companies promising a quick resale
- Avoid getting hit by unexpected charges years after selling or gifting your timeshare
- Find legal grounds for getting out of your timeshare
- Invest in the right process for getting free of your timeshare
Cancelling Is the Only Way Out
The only way out of a timeshare contract you no longer want is to get the timeshare company that sold it to you to cancel the contract. This is a months-long process. Often, it involves taking the company to task for the illegal sales tactics they used when selling you the property in the first place.
Owners rarely find success tackling the process themselves. Most need the help of a qualified, experienced, and legitimate timeshare cancellation company to get their contracts canceled.
Let Our Experts Fight for You
At Sapphire, we understand timeshare laws inside and out. We help owners just like you cancel their unwanted timeshare contracts every day. Contact us today to learn more about how we can help you do the same.