$0.97 Time Share Problems

I wonder if the people buying 2 br 2 bath every year condos on e bay really understand the true expense is the every year maintenance fee and tax?


If they don't, I can see problems in the future for timesharing as they default on the maintenance/special assessment fees.

Sterling

I know of no timeshare that will allow you to take your week without paying maintenance fees first. Some will not allow you to transfer a deed without paying the next maintenance fee. I do agree, however, that he or she that buys a timeshare for .97 cents may not appreciate what they have. funtime

Probably not.

I also suspect that many of the people who dish out $35,000.00 to the developer after having a great weeklong vacation don't either, hence the abundance of resale weeks and giveaways...

Kauai Kid said:

I wonder if the people buying 2 br 2 bath every year condos on e bay really understand the true expense is the every year maintenance fee and tax?


If they don't, I can see problems in the future for timesharing as they default on the maintenance/special assessment fees.

Sterling

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funtime said:

I know of no timeshare that will allow you to take your week without paying maintenance fees first. Some will not allow you to transfer a deed without paying the next maintenance fee.

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Yes, however there are some auctions where the seller is paying closing costs, including this year's maintenance fees (just so they can dump their timeshare). Those buyers will not experience the MF "sting" until they get their first bill in December.

Kurt

PigsDad said:

Yes, however there are some auctions where the seller is paying closing costs, including this year's maintenance fees (just so they can dump their timeshare). Those buyers will not experience the MF "sting" until they get their first bill in December.

Kurt

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More and more this is the case as people need to find willing takers and even $.97 sales that require $700 annual fee prior to transfer end up going unclaimed. There even seems to be a small group that take prepaid units like that (as some people are willing to prepay two or three years of fees to get the "sale") and then default on fees when they do become due. Another PCC type scam.

I just bought twoweeks in New Orleans. One for $0.97 and the other a little more expensive at $1. In both cases, closing costs paid by the seller, resort transfer fee paid by the seller and 2011 maintenance fee paid by the seller. I even got a free mardi Gras reservation with the one

I am well aware of the annual maintenance fees that will be due for 2012 (covered by renting my Mardi Gras week)

But you are right that the resort should worry about me. With no skin in the game I could easily just stop paying. I think we have to worry about the folks that still owe on mortgages too.

All that it would take for me to stop paying is a dirty room, or rude front desk person, or a cheaper place down the street. or an increase in fees to a point where it would be cheaper to rent. The guy that owes thousands on an asset worth pennies is, in my mind, a much greater risk to the associations.

ronparise said:

All that it would take for me to stop paying is a dirty room, or rude front desk person, or a cheaper place down the street. or an increase in fees to a point where it would be cheaper to rent.

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So you would just ignore the MF's and dump the burden on the resort and the other owners? Nice way to take responsibility for yourself. Remind me to never go to dinner with you. I'd hate to be stuck with the bill because you didn't like your dessert.

ronparise said:

...The guy that owes thousands on an asset worth pennies is, in my mind, a much greater risk to the associations.

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Not at all. The association has nothing to do with whether the owner has their timeshare financed or not. That is the lender's problem. The only risk to the HOA is whether the M/F gets paid or not. Assuming that the owner that owes on their timeshare is more likely to default on their M/F is open to debate. I don't really know which one will be more likely to default.

Your willingness to just walk out on a whim will have consequences. You will be hounded by a collection agency and your credit will be destroyed.

You will be hounded by a collection agency

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Cease and desisty letter . . . .

and your credit will be destroyed

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Blemished

RonParise makes some good points - more that others can have this "walkaway" mindset. There are more folks getting in with very little "skin in the game" and it can have a disastrous effect if and when a special assessment is announced. I was watching those NO timeshares too. I hope that you stay and invest in your timeshare by snagging the good reservations that will allow you to rent your weeks etc. When buying a timeshare, we all need to look to see if there is an alternative way to pay for maintenance fees and more of us will be mini landlords - renting out a week here, a week there etc. Funtime

maybe I should contact my brother...the cop down in Fort Meyers...to BOLO for one Ronparise...


I can see where an SA would shock some folks but walk-away? Wow, talk about a wrong reaction. Does one walk away from a car loan when the water pump needs replacing? Sell the car, maybe. But walk away?!?

LOL

Art4th said:

So you would just ignore the MF's and dump the burden on the resort and the other owners? Nice way to take responsibility for yourself. Remind me to never go to dinner with you. I'd hate to be stuck with the bill because you didn't like your dessert.

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that is too funny, but so is this thread.

Art4th said:

So you would just ignore the MF's and dump the burden on the resort and the other owners? Nice way to take responsibility for yourself. Remind me to never go to dinner with you. I'd hate to be stuck with the bill because you didn't like your dessert.

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Maybe you could get away with just washing dishes for the night.

Be careful:
Timeos2 will have you arrested for criminal fraud!

sorry for the missunderstanding

The first point I was trying to make (I guess,not very well) is that folks like me, with little skin in the game are a serious risk to a POA but one way to manage that risk would be to manage the resort so that my vacation experience is always a good one (clean rooms, courteous staff etc) and that they manage resort's finances (proper reserves, etc) so that my stay at the resort wont be any more expensive than a stay at a similar suite hotel or rental vacation home

The second point I wanted to make is that someone that finances a timeshare purchase from a developer is even a greater risk to a POA than me. At least I went in with my eyes open, knowing a little about what I was getting myself into (thank you, Tuggers). A retail buyer often buys on emotion with little thought or logic. And his vacations each year, at least until his mortgage is paid off, far exceed the cost of a comparable rental. You might say (and you did) that not paying the mortgage is not the same as not paying the maintenance fee, but I would argue if someone cant pay one, they wont pay the other.

"Funtime" reads me perfectly. I own enough Wyndham points to book several short get away trips to visit Mickey Mouse (about a 3 hour drive from my home) or a fall visit to the mountains of North Carolina to see the leaves change color. And also a week in either Washington DC or San Francisco where I have family. I am looking for a few more weeks in special places at special times and will become a mini-landlord to cover the cost of my own use. New Orleans with a festival almost every month seems perfect to me. Im betting I can rent my weeks at twice the maintenance fees. Im watching two auctions right now. With any luck Ill snag one of them by the weekend

If this turns out to be a bad plan I wont need to walk away. Ill put them back up on ebay and give them away to the next dummy. The guy that owes thousands wont have that luxury.

By the way I didnt say Id walk away on a whim, I said I am a risk to a POA, but there are far more serious ones

ronparise said:

The second point I wanted to make is that someone that finances a timeshare purchase from a developer is even a greater risk to a POA than me.

If this turns out to be a bad plan I wont need to walk away. Ill put them back up on ebay and give them away to the next dummy. The guy that owes thousands wont have that luxury.

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Not really as when there is a mortgage due & payable the mortgage holder is on the hook for the fees if they foreclose (and a well run Association makes sure that they do foreclose on delinquent purchasers & that credit it will be double for that owner. One from the mortgage/personal loan & a second from the Association for the fees). The cash buyer probably paid little & would only be dinged for the fees - much less of a hit.

And you have a good exit plan that meets all requirements for owners to meet their obligations. (Not walking away or setting up a possibly sham process to defraud your fellow owners/Association ) Buy right & it's easy to sell if needed.

John

I realize that you sit on timeshare POA boards and are therefore in a position to see lots the most of us dont see, but I sell real estate in the foreclosure capital of the world and I dont see the banks paying condo fees on the units they take back, in fact most of them name the condo associations in the foreclosure too. (in addition to the debtor and any second mortgages and other lien holders.)

Typically a bank owned property is sold they will pay up to 6 months of fees, but thats all

funtime said:

I know of no timeshare that will allow you to take your week without paying maintenance fees first.

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I just deposited and successfully exchanged my 2012 Sheraton Desert Oasis unit without having to pay the MF first.

ronparise said:

John

I realize that you sit on timeshare POA boards and are therefore in a position to see lots the most of us dont see, but I sell real estate in the foreclosure capital of the world and I dont see the banks paying condo fees on the units they take back, in fact most of them name the condo associations in the foreclosure too. (in addition to the debtor and any second mortgages and other lien holders.)

Typically a bank owned property is sold they will pay up to 6 months of fees, but thats all

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That is true - but they do pay and if the Association stays on top of delinquents & pressures the loan holder to collect or lose it to foreclosure usually that works in timeshare. It wouldn't be as effective in whole ownership condos as there most likely is no ongoing relationship between sales & the Association. One case where timeshare operations & the need for sales actually gives them an edge. Legally 6 months is all they are on the hook for - plus ALL fees once they foreclose - so keeping accounts at less than a year in delinquent status becomes a crucial part of the process and one far too many Associations ignore for for longer. It hurts them badly.

How many timeshare lenders actually "foreclose" on a delinquent account? Very few, if any !!! WHY???!!! Because then the lender is responsible for the annual maintenance fees, since they now own the timeshare week(s) or points. They (usually) will not take on that responsiblility.

Tony

Foreclosurea

Plenty of them. Especially Marriott. You can look at the orange county fl land registry to see them in the official records. And when they do get the title back, be it by judicial order or conveyance by debtor back to mortgagee, mortgagee ends up with clean title with no obligation to pay deficient maintenance or assessments. What happens to the written off dues?

They get added to the general operating expenses of the condo so we all get to pay them in our maint fees.

Don't believe me? Look up the condo dox for mgv/mgr.

teepeeca said:

How many timeshare lenders actually "foreclose" on a delinquent account? Very few, if any !!! WHY???!!! Because then the lender is responsible for the annual maintenance fees, since they now own the timeshare week(s) or points. They (usually) will not take on that responsiblility.

Tony

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Tony

The mortgage companies may be responsible for the maintenance fees, but my experience with forclosures (in SW Florida) is that they dont pay condo fees...I would bet that they dont pay a timeshares maintenance fees either. I agree with you though, they probably dont foreclose. I suspect because the value of the asset is so small

The next question, would be, how many POA's have an agressive collections strategy for past due maintenance fees and will take it to the end and actually foreclose?

Access Legalese for Grande Vista here.

Condo dox for MGV/MGR filed in Orange County FL as document 19965744275

http://or.occompt.com/recorder/eagleweb/viewDoc.jsp?node=DOCC10283841

The lien by the condo association is subordinate to a registered mortgage on a property.

And they do foreclose. And we pay increased MF as a result.

ronparise said:

Tony

The mortgage companies may be responsible for the maintenance fees, but my experience with forclosures (in SW Florida) is that they dont pay condo fees...I would bet that they dont pay a timeshares maintenance fees either. I agree with you though, they probably dont foreclose. I suspect because the value of the asset is so small

The next question, would be, how many POA's have an agressive collections strategy for past due maintenance fees and will take it to the end and actually foreclose?

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Caracas

equitax said:

Condo dox for MGV/MGR filed in Orange County FL as document 19965744275

http://or.occompt.com/recorder/eagleweb/viewDoc.jsp?node=DOCC10283841

The lien by the condo association is subordinate to a registered mortgage on a property.

And they do foreclose. And we pay increased MF as a result.

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This is off topic but I notice that you are currently in Caracas, Venezuela. I lived in Caracas for 2 years several years ago. I was the regional manager for an American computer company.

How is Caracas today? It wasn't the greatest when I lived there but my friends tell me that it is much worse. It was pretty dangerous and very expensive but the weather is the best.

When I lived there the exchange rate was 4.2 Bolivares ( old ones ) to 1 US dollar. These old Bolivares were converted at the rate of 1000/1 for the BsF in 2008. When I lived there it was very expensive for everything in US Dollars.

I also spent a lot of time in Western Venezuela ( Maracaibo area ) and Eastern Venezuela ( Puerto Ordaz ).