According to the American Resort Development Association, timeshares are a $10.5 billion dollar industry. While many people enjoy their timeshares, not everyone is happy with the decision. That being the case, timeshares usually have a grace period. During this period, a buyer can choose to cancel their purchase.
Unfortunately, the cancellation period isn’t very long. It can be exceedingly difficult to cancel after that. Read on to find out what your options are if the cancellation period is over.
The Grace Period Explained
Most states in the US legally require a rescission period for timeshare buyers. The period tends to differ from state to state, with some states offering longer periods than others. Generally, the cancellation period will be between five and 15 days depending on the state.
In Washington, the period is seven days after signing or seven days after receiving the disclosure papers. It depends on whichever is longer. Nevada has different rules. It allows for cancellation by midnight five days after signing.
Cancellation Within The Grace Period
It’s not too difficult to cancel within the cooling-off period. Timeshare owners should collect proof of cancellation within that period. Put your request in writing and send it via certified mail. Make sure to request a return receipt.
The timeshare company should send the deposit or other money quickly, per state law.
Canceling Ownership After The Rescission Period Expires
In some cases, canceling a timeshare after the rescission period expires isn’t possible. In others, it can be done. Some contracts allow for cancellation after a certain period has passed. Timeshare ownership can also be canceled if either party believes the contract was breached.
If the owner doesn’t pay the management fees, the organization may decide to cancel. On the other hand, timeshare owners may be able to cancel if they believe the organization failed to perform its duties. If either party is in breach of contract, the other may begin court litigation to recoup financial losses.
Alternative Exit Solutions
Should cancellation prove too difficult, you have other options. You can ask the organization to sell the timeshare on your behalf.
When Your Timeshare Is Too Costly
Sometimes a timeshare will result in an untenable financial situation. In these cases, giving it back to the organization may be your best bet. Of course, the organization must be willing to accept it.
Selling It Yourself
You can also attempt to sell the timeshare privately. Some timeshare owners choose to sell it for a nominal fee, in some cases as low as a dollar!
The ridiculously low price is a product of market saturation. There are a lot of people looking to sell their timeshares. If you choose to do so, be ready to take a big financial hit.
Use A Cancellation Company
Attempting to cancel your timeshare by yourself is rough. Utilizing the services of a timeshare cancellation company like ours can make canceling ownership a breeze.
What We Do
Our process includes four milestones. The first is the onboarding process. You’ll complete your contracts, pay the fee, and receive your welcome.
Next comes the first rounds of disputes and demands. The first 30 days of the process are critical to its success. We send demands to developers to top foreclosure if needed. We will dispute negative credit items if they exist. Finally, we build a case for federal law violations.
The third milestone is the resort response and/or credit bureau response. This will continue the case build for 6 to 9 months for direct cancellation. We continue to monitor your case for credit and risk management.
Finally, one of two things will happen. You may receive a notarized release. The other possibility is you enter a credit and risk management program. It includes legal forwarding to credit attorneys.
Your timeshare is removed from your credit and your account balance zeroed out. Alternatively, you will be with a credit/risk management attorney. The timeshare is canceled, and you’re now seeking damages.
Can I Just Stop Paying?
Well, you can just stop paying, but that’s not the best exit solution. Much like a mortgage, the bills won’t stop coming just because you don’t pay them. The bills can include property taxes, repairs, and utilities.
If a timeshare needs repair or improvements that insurance doesn’t cover, it’s on you. The timeshare company may charge you with a special assessment. You must pay for it, no matter what.
Liens and Repossessions
When/if you fall behind on your payments, the company might put a lien on the property and repossess it. The timeshare company now has two options. A judicial foreclosure includes filing a lawsuit. The suit pursues the court’s permission to sell the timeshare, thus satisfying the lean.
The other option is a non-judicial foreclosure. A lawsuit isn’t required here. Instead, the company follows state law procedures. While laws vary by state, both result in the company gaining ownership of the timeshare.
The Consequences of Non-Payment
As mentioned, stopping payment isn’t a great idea. The ordeal does not end once foreclosure occurs. You’ll be responsible for any and all outstanding fees, including:
- Attorney fees
- Unpaid assessments
- Late charges
The Effect on Your Credit
In addition to being responsible for fees, your credit may be affected. If your timeshare company chooses not to report it, consider yourself lucky. However, foreclosures are public records, and credit bureaus usually search for them. Therefore, even when foreclosure isn’t reported, it may still negatively affect your credit score.
The usual credit score hit is about 100 points. Should you fail to make any foreclosure payments, expect a bigger hit.
The upside to this option is that you will eventually be rid of your timeshare obligation. The downside is that it may haunt you for years to come.
Choose Sapphire Timeshare Cancellation
We pride ourselves on our superior service. We are the only exit company licensed, insured, and bonded in the US. That being said, we work globally and handle almost all timeshare developers. Canceling a timeshare after the grace period isn’t a problem for us.
We believe in defending you against unfair timeshare practices. We provide a safe, thorough, and low-stress exit solution. If you’d like to know more about timeshares and if you should cancel, visit our blog today.