24 Dec Can I leave a timeshare to the timeshare company in my will?

Q. Can an owner of a timeshare will the timeshare back to the timeshare corporation and does the corporation have to accept it?
— Owner

A. Timeshares can be hard to get rid of, and it’s not uncommon for the heirs of a timeshare owner to not want to take on the liability.

As a general rule, unless it is in an attempt to defraud creditors, a beneficiary may always renounce or disclaim a bequest made to him or her in a will, said Catherine Romania, an estate planning attorney with Witman Stadtmauer in Florham Park.

Just because you write a provision in your will, it does not mean it is legal, needs to be followed or can be carried out, Romania said.

For example, a beneficiary designation on a bank account or certificate of deposit (CD) to your brother would override a specific bequest in your will that the same bank account or CD goes to your sister, she said. In this case, the bank will pay the bank account or CD to your brother regardless of what the will provides.

Same for shares in a closely hold business. If there is a contract between the shareholders governing what happens to shares of the business is someone dies, such contracts also override a will provision, she said.

The timeshare is a contract and for this reason the terms of the contract control what happens and the will does not, she said.

“If the will provision does not contradict the contract, such as bequeathing the unit to a third party who will continue to pay the contract obligations, both documents may co-exist,” she said. “A timeshare owner cannot avoid contractual obligations by merely returning the unit back to the corporation unless this is allowed in the contract.”

And, she said, the corporation does not have to accept the unit whether it is returned by the terms of the will or by the executor in administrating the estate unless the contract provides for it or terms of the return are negotiated.

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This story was originally published on Dec. 24, 2020.

NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.