16 Apr How to get rid of an unwanted timeshare
Q. My 83-year-old mother has a timeshare that she has not been able to use for years. It has an annual maintenance fee that she can’t afford. She wants to sell it but was once scammed by a company that said it would sell her timeshare. How do we get rid of it?
— Caring child
A. Timeshares often look like a great deal, but many timeshare owners come to regret the purchase.
“Timeshares are like a bad cold — they seem never go away,” said Jerry Lynch, a certified financial planner with JFL Total Wealth Management in Boonton. “They are emotional sells, generally that you buy when you are on vacation saying to yourself, `It would be great to do this every year.'”
Often, Lynch said, they are financed and you pay for years — non-deductible — and the maintenance fees can be rather expensive.
In the right situation, he said, they can be okay, but the problem is that there is generally no resale market for “used” timeshares.
He recommends you start by contacting the timeshare company to see if it will take it back.
“Often they will just take it back and not give you any money for it,” he said.
If the timeshare company won’t play ball, you can take extreme measures — and note that this strategy isn’t appropriate for younger folks who need to build and maintain good credit. But for your mom, who has limited means and isn’t likely to look for large loans in the future, it could be worth trashing her credit report and score.
“If you mom has limited means and they say no, just stop paying the maintenance fees,” Lynch said.
He said Social Security is generally protected from creditors — except from the U.S. government for back taxes or defaulted student loans.
Lynch said IRA assets are also protected from creditors.
“So if the timeshare company refuses to help, just say, `Catch me if you can!’” Lynch said.
When it comes to timeshare resellers, the Federal Trade Commission offers some warnings.
It said real estate agents and brokers who say they specialize in reselling timeshares often make claims that aren’t true, such as that your timeshare’s area is “hot” or they’re overwhelmed with buyer requests. Some may even claim to have a buyer for you, or that they can sell your timeshare in a certain time period.
“If you want to sell your deeded timeshare, and a company approaches you offering to resell your timeshare, go into skeptic mode,” the FTC said.
Among its recommendations:
Don’t agree to anything until you check out the reseller. Contact the state attorney general and local consumer protection agencies in the state where the reseller is located and ask if there are any complaints.
Confirm that the reseller and its agents are licensed to sell real estate where the timeshare is located — check with the state’s real estate commission.
Review any promises in writing, and ask how often the timeshare will be advertised or promoted, and how often you’ll get progress reports.
Next, ask about fees and timing, the FTC said.
“It’s preferable to do business with a reseller that takes its fee after the timeshare is sold,” the FTC said. “If you must pay a fee in advance, ask about refunds. Get refund policies and promises in writing.”
You can read more from the FTC here.
Email your questions to moc.p1553425262leHye1553425262noMJN1553425262@ksA1553425262.