# Defaulting on Maintenance Fees



## OldPantry (May 24, 2011)

Hi,
I'm just wondering what REALLY happens to owners who default on their Marriott timeshare maintenance fees.  I know the obligation to pay is real, and that there are, at least theoretically, substantial penalties for failure to pay.  But what is happening in reality?  Are the HOAs actively pursuing these folks?  Are they hiring collection agencies?  Or do they just repossess the weeks eventually?  Do they then give them back to Marriott, or sell them back?
I've seen a number of timeshare resales on Ebay that are the result of bankruptices; but how about the folks who just quit paying because they're tired of it?


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## DeniseM (May 24, 2011)

They turn you over to collections, and report you to the credit bureaus which damages your credit.  Eventually they will foreclose.

The HOA's take nonpayment of MF seriously - in this economy they can't afford to let it slide.


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## winger (May 24, 2011)

If a person is at a part of their lives when they no longer can go TS traveling, or have no heirs willing to take the units, and nothing else major (e.g. home, car) to purchase, then just not paying the MF's would be a great way to unload your unit.

TS's are like vehicles, a means to get to your destination.  If you don't pay the annual upkeep fees and just park it in the street, like a real car, eventually it will get 'towed' and out of your life.


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## DeniseM (May 24, 2011)

winger said:


> just not paying the MF's would be a great way to unload your unit.



Great????    How so?   

When someone defaults* YOU *and *I *pay their maintenance fees - not the developer and not the management company.  So, before you just let it go into foreclosure, please make an earnest effort to give it away.


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## winger (May 24, 2011)

DeniseM said:


> Great????    How so?
> 
> When someone defaults* YOU *and *I *pay their maintenance fees - not the developer and not the management company.  So, before you just let it go into foreclosure, please make an earnest effort to give it away.


Of course, out of courtesy/consideration, this is what one should do - I am just pointing out the obvious last alternative.  Some people may not want to take the time/energy to find a recipient (purchased or gifted).  LOL, the way Marriott is going (maybe it is an industry trend), when I am ready to no longer TS, maybe I would not even be able to GIVE AWAY the unit *with a good conscious*.


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## timeos2 (May 24, 2011)

winger said:


> Of course, out of courtesy/consideration, this is what one should do - I am just pointing out the obvious last alternative.  Some people may not want to take the time/energy to find a recipient (purchased or gifted).  LOL, the way Marriott is going (maybe it is an industry trend), when I am ready to no longer TS, maybe I would not even be able to GIVE AWAY the unit *with a good conscious*.



Taking a serious hit to your credit report - no matter how immune you may think you are from negative results - is a very serious risk to take.  There are far better ways to handle transferring your obligations to a new taker than simply walki ng away. They start with offering to give it back to the resort - more and more resorts may take you up on this to save themselves avoidable expenses & a long period of having to deal with non-performing intervals.  If they won't there are plenty of other, easy & inexpensive methods to find a new owner. Taking a hit on credit and simply ignoring your bills is seldom a "great" choice for anyone.  It may end up being the ONLY choice in rare instances but never the first or primary one.  

I would hesitate to make that recommendation as an answer to the vast majority of owners at any resort.


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## larryallen (May 24, 2011)

timeos2 said:


> Taking a serious hit to your credit report - no matter how immune you may think you are from negative results - is a very serious risk to take.  There are far better ways to handle transferring your obligations to a new taker than simply walki ng away. They start with offering to give it back to the resort - more and more resorts may take you up on this to save themselves avoidable expenses & a long period of having to deal with non-performing intervals.  If they won't there are plenty of other, easy & inexpensive methods to find a new owner. Taking a hit on credit and simply ignoring your bills is seldom a "great" choice for anyone.  It may end up being the ONLY choice in rare instances but never the first or primary one.
> 
> I would hesitate to make that recommendation as an answer to the vast majority of owners at any resort.



Sadly there are Marriott weeks that go unsold for ONE DOLLAR on Ebay every week. People may have to buy their way out of the liability and thus for some, right or wrong, walking away may be the best choice for THEM.


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## DeniseM (May 24, 2011)

larryallen said:


> Sadly there are Marriott weeks that go unsold for ONE DOLLAR on Ebay every week. People may have to buy their way out of the liability and thus for some, right or wrong, walking away may be the best choice for THEM.



Selling a timeshare on ebay for $1 + closing costs is a completely different proposition, than giving it away.  Many people have had success giving away their "worthless" TS's on the TUG Bargain Deals Board.  I encourage everyone to try that method first - it's free and painless.


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## Mr. Vker (May 24, 2011)

I couldnt find the thread, but someone recently posted on TUG a panicked thread. They had lost their weeks to Marriott for missing 2 consecutive years of maintenance fees. (I think those facts are correct.)

He was looking for guidance. There really wasnt any available.


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## larryallen (May 24, 2011)

DeniseM said:


> Selling a timeshare on ebay for $1 + closing costs is a completely different proposition, than giving it away.  Many people have had success giving away their "worthless" TS's on the TUG Bargain Deals Board.  I encourage everyone to try that method first - it's free and painless.



I agree but if I were a "buyer" taking over a worthless timeshare I think I would want to go through escrow to make sure I didn't get any unexpected liens. I doubt they would transfer to the buyer but I don't know that for sure. Thus I think the closing costs are probably the same either way. Just because you are getting it for "free" doesn't mean there isn't a cost to it. In any event I agree with you that Ebay is not the only option for getting out of your timeshare.


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## CMF (May 24, 2011)

So, what does the HOA do with the weeks?  Does it vary by resort?

Charles


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## DeniseM (May 24, 2011)

CMF said:


> So, what does the HOA do with the weeks?  Does it vary by resort?
> 
> Charles



Yes - the BOD makes that decision, but eventually, they are resold in some manner.


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## BocaBoy (May 24, 2011)

larryallen said:


> I agree but if I were a "buyer" taking over a worthless timeshare I think I would want to go through escrow to make sure I didn't get any unexpected liens. I doubt they would transfer to the buyer but I don't know that for sure. Thus I think the closing costs are probably the same either way. Just because you are getting it for "free" doesn't mean there isn't a cost to it. In any event I agree with you that Ebay is not the only option for getting out of your timeshare.



Clearly the lien for unpaid maintenance fees does go with the title to the unit, the same as a lien for unpaid property taxes on a house.


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## bogey21 (May 24, 2011)

Mr. Vker said:


> I couldnt find the thread, but someone recently posted on TUG a panicked thread. They had lost their weeks to Marriott for missing 2 consecutive years of maintenance fees. (I think those facts are correct.)



A couple of years ago, when Marriotts really had top dollar value I found out that my ex-wife had not paid the the last 2 MFs on the Week she got out of our divorce.  On her behalf I checked with Marriott and the Week was in the process of foreclosure.

Fortunately this was back when Marriott had the old Rental and Sales Programs.  After I paid the arrears Marriott rented it for her and later sold it for her netting her about $35,000 after commission.

Unfortunately, those programs are long gone.

George


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## larryallen (May 24, 2011)

BocaBoy said:


> Clearly the lien for unpaid maintenance fees does go with the title to the unit, the same as a lien for unpaid property taxes on a house.



You are right. I wasn't really thinking it through when I posted. So ya, the point is whether someone gives you their timeshare for "free" or you pay a buck on Ebay there are closing costs that you SHOULD pay like title/escrow.


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## Cathyb (May 24, 2011)

*One more thing happens...*



OldPantry said:


> Hi,
> I'm just wondering what REALLY happens to owners who default on their Marriott timeshare maintenance fees.  I know the obligation to pay is real, and that there are, at least theoretically, substantial penalties for failure to pay.  But what is happening in reality?  Are the HOAs actively pursuing these folks?  Are they hiring collection agencies?  Or do they just repossess the weeks eventually?  Do they then give them back to Marriott, or sell them back?
> I've seen a number of timeshare resales on Ebay that are the result of bankruptices; but how about the folks who just quit paying because they're tired of it?



We have always paid our HOA fees on time.  The last few years we are being hit by people who walked away from THEIR obligations :annoyed: .  Marriott and Westin (and I suppose others) reallocate those lost fees to the innocent and bill paying owners; hence much larger HOA fees for us .  Please find another way.


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## dioxide45 (May 24, 2011)

What seems to be happening now with Marriott and the new trust is that at least some of the weeks that are being foreclosed on are being placed in to the trust. I don't know if these are just mortgage foreclosures or if there are also some HOA MF foreclosures. If there are, then MVCI is picking up the tab on those past due MFs in order to put them in to the trust.


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## MALC9990 (May 25, 2011)

Mr. Vker said:


> I couldnt find the thread, but someone recently posted on TUG a panicked thread. They had lost their weeks to Marriott for missing 2 consecutive years of maintenance fees. (I think those facts are correct.)
> 
> He was looking for guidance. There really wasnt any available.



He was an owner at one of the Marriott resorts in Europe. These are all RTU resorts and so there is no deed property ownership. Basically at these resorts if you miss two consecutive years MFs and remain in default MVCI will rescind your right to use and the week defaults back to MVCI ownership,

The week is then back in the unsold inventory and MVCI can sell it again. MVCI become responsible for all the MFs and the previous owner is no longer an owner of the Right to Use.

However if they still own finance on the purchase then they now have a debt that will be pursued by the finance house or bank from which they borrowed the money to but the week. Even if they financed the purchase through MVCI, they will still be in debt to a bank or finance company since MVCI do not finance this themselves.

Failing to keep up with the payments on the finance for a week they no longer own would have a significant credit rating impact.


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## OldPantry (May 25, 2011)

Cathyb said:


> We have always paid our HOA fees on time.  The last few years we are being hit by people who walked away from THEIR obligations :annoyed: .  Marriott and Westin (and I suppose others) reallocate those lost fees to the innocent and bill paying owners; hence much larger HOA fees for us .  Please find another way.


Hey, don't read anything into my question.  I'm curious, not plotting.  In fact, the opposite.  I've bought two timeshares in the last year, and may well expand the inventory later.


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## Ridewithme38 (May 25, 2011)

Cathyb said:


> We have always paid our HOA fees on time.  The last few years we are being hit by people who walked away from THEIR obligations :annoyed: .  Marriott and Westin (and I suppose others) reallocate those lost fees to the innocent and bill paying owners; hence much larger HOA fees for us .  Please find another way.



How do you know that your HOA fees went up because of people walking away from their obligations....i mean i don't doubt that it does...but, does the HOA put out some documentation that MF's aren't just going up because of increased maintenance costs, wage increases, needing more staff, upgrades, repairs, property taxes etc.?


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## DeniseM (May 25, 2011)

Ridewithme38 said:


> How do you know that your HOA fees went up because of people walking away from their obligations....i mean i don't doubt that it does...but, does the HOA put out some documentation that MF's aren't just going up because of increased maintenance costs, wage increases, needing more staff, upgrades, repairs, property taxes etc.?



The board must itemize the MF bills, so it's specifically itemized in the budget as delinquent maintenance fees.  The other items you mentioned are itemized too, so you always know exactly where the increases are. 

When people complain about other owners defaulting, we aren't just speculating about it, we know exactly what it's costing us.  One of my MF bills was $300 more...  That's why I get hot when people casually suggest defaulting and putting the burden on others.  I suspect that now that you are an owner, you will fill differently about it.


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## Ridewithme38 (May 25, 2011)

DeniseM said:


> Yes - in our maintenance fee bill there was a line item of several hundred dollars for delinquent maintenance fees.  HOA must itemize the MF bills.



cool...i didn't know maintenance fee bills were that detailed...is it weird i'm looking forward to getting my first one :whoopie:


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## DeniseM (May 25, 2011)

Yes - the board must provide an itemized budget to owners.


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## OldPantry (May 25, 2011)

DeniseM said:


> The board must itemize the MF bills, so it's specifically itemized in the budget as delinquent maintenance fees.  The other items you mentioned are itemized too, so you always know exactly where the increases are.
> 
> When people complain about other owners defaulting, we aren't just speculating about it, we know exactly what it's costing us.  One of my MF bills was $300 more...  That's why I get hot when people casually suggest defaulting and putting the burden on others.  I suspect that now that you are an owner, you will fill differently about it.



Was that $300 a single line item, or $300 per owner?  Again, just asking.  I'm not gonna stiff the HOA!


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## DeniseM (May 25, 2011)

OldPantry said:


> Was that $300 a single line item, or $300 per owner?  Again, just asking.  I'm not gonna stiff the HOA!



It was $300 to each owner for one week of ownership!


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## dioxide45 (May 25, 2011)

OldPantry said:


> Was that $300 a single line item, or $300 per owner?  Again, just asking.  I'm not gonna stiff the HOA!



Our 2011 Harbour Lake estimate operating budget shows a $43 line item for bad debt. This is where the HOA is passing those delinquent fees on to other owners.


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## Ridewithme38 (May 25, 2011)

DeniseM said:


> When people complain about other owners defaulting, we aren't just speculating about it, we know exactly what it's costing us.  One of my MF bills was $300 more...  That's why I get hot when people casually suggest defaulting and putting the burden on others.  I suspect that now that you are an owner, you will fill differently about it.



That definatly changes things....i really did always think that owners were just speculating...or at the most it was a few pennies on the dollar a year hidden beneath the average MF increases because of normal expenses

Wow, $300...i'd be steaming too! I don't know what your Normal MF's are for that resort...and its really none of my business...but geez, if it was $2100 and it went up $300 because of people dropping out...thats a 7th of it...every owner should be getting an extra day....if only it was that easy :ignore: 

I know it doesn't work that way....So basicly when someone ducks out, your paying (ALOT) more for the same thing you got for less the year before   

Either way, i learned something today...thats always a good thing...i'm impressed that the MF's are detailed like that and looking forward to reviewing my own when it comes...early 2012 :whoopie:


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## dioxide45 (May 25, 2011)

Ridewithme38 said:


> Either way, i learned something today...thats always a good thing...i'm impressed that the MF's are detailed like that and looking forward to reviewing my own when it comes...early 2012 :whoopie:



You need to look at the additional information that comes with your bill. It isn't broken out on the bill itself or on the payment coupon. It is part of the operating budget.


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## timeos2 (May 25, 2011)

dioxide45 said:


> Our 2011 Harbour Lake estimate operating budget shows a $43 line item for bad debt. This is where the HOA is passing those delinquent fees on to other owners.



Think about that. $43 per week times how many thousands of weeks - what would that pay for in needed items around your resort?  Money gone - never to be recovered.  

Our resorts have kept delinquencies extremely low after being burned badly by Developer run management that was far more interested in sales than collections. Once we changed management the focus was corrected but it took years - and at least one Special Assessment - to recover.  Now it is one of the top three areas monitored to be sure it never again gets out of control. It is far easier and cheaper to stay on top of delinquencies than it is to bring them back to reasonable levels once they explode.  

No resort has zero delinquency but keeping it as low as possible must be a stated and actively pursued goal.


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## BocaBoy (May 25, 2011)

DeniseM said:


> It was $300 to each owner for one week of ownership!



I am skeptical.  What resort is that?  Bad debt expense ranges from $7 to $28 per unit week at the four Marriott resorts where I own.


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## dioxide45 (May 25, 2011)

BocaBoy said:


> I am skeptical.  What resort is that?



It is likely a small resort. They are more susceptible to this than larger ones as there are fewer owners to spread the loses over. Our Habour Lake has a $43 bad debt expense, but Grande Vista, which is huge, is only around $16.


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## DeniseM (May 25, 2011)

BocaBoy said:


> I am skeptical.  What resort is that?  Bad debt expense ranges from $7 to $28 per unit week at the four Marriott resorts where I own.



Westin Ka'anapali Ocean Resort Villas.  That year the maintenance fee was about $2,500 for a 2 bdm.


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## e.bram (May 25, 2011)

The higher the MFs, the more people will bail. This could cause a death spiral even in a high end resort. Travel expenses are also going up, stressing people financially. The TS crowd is getting older with less money and physical ability also adding to the defaulting.


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## sparty (May 26, 2011)

timeos2 said:


> Think about that. $43 per week times how many thousands of weeks - what would that pay for in needed items around your resort?  Money gone - never to be recovered.
> 
> Our resorts have kept delinquencies extremely low after being burned badly by Developer run management that was far more interested in sales than collections. Once we changed management the focus was corrected but it took years - and at least one Special Assessment - to recover.  Now it is one of the top three areas monitored to be sure it never again gets out of control. It is far easier and cheaper to stay on top of delinquencies than it is to bring them back to reasonable levels once they explode.
> 
> No resort has zero delinquency but keeping it as low as possible must be a stated and actively pursued goal.



The thing that always bothers me is that if you subscribe 100% to the "bend over and take it" policy then there's no hope to say enough is enough.  If enough people walk then it becomes necessary for the managing company and HOA to realize that maybe cutting some of the management related fees may be a good idea or the enterprise will cease to exist.


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## Ridewithme38 (May 26, 2011)

sparty said:


> The thing that always bothers me is that if you subscribe 100% to the "bend over and take it" policy then there's no hope to say enough is enough.  If enough people walk then it becomes necessary for the managing company and HOA to realize that maybe cutting some of the management related fees may be a good idea or the enterprise will cease to exist.



See i don't know that that is the problem...people have to find value in what they buy...weather its nice large rooms or multiple ammenities or on site programs or even nice accommodating staff...i don't think people would leave if the TS BOD/HOA keep the resort value up....well some still would, people lose jobs all the time or get into tight financial situations, they'll bail no matter what...but i think it would definatly cut down if they improved ammenities instead of cutting costs...its about value


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## OutAndAbout (May 26, 2011)

larryallen said:


> BocaBoy said:
> 
> 
> > Clearly the lien for unpaid maintenance fees does go with the title to the unit, the same as a lien for unpaid property taxes on a house.
> ...


I don't know about all timeshare companies, but Marriott has confirmed if weeks have their maint fees are paid/any outstandings w/o having to pay a closing company.

So Yes, in some instances you can get a timeshare from a stranger for "free"


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## OutAndAbout (May 26, 2011)

DeniseM said:


> BocaBoy said:
> 
> 
> > DeniseM said:
> ...



Here's the Bad Debt Expense for most of the North American & Caribbean Marriott timeshares:

Per Unit 2011 (Budgeted), US$
09.01 Aruba_OceanClub
05.00 Aruba_SurfClub
04.56 AZ_Phoenix_DesertRidge
19.81 CA_LakeTahoe_TimberLodge
13.81 CA_Newport_NewportCoast
01.25 CA_PalmDesert_DesertVillasI (NOTE: First Marriott built timeshare and no ROFR)
04.88 CA_PalmDesert_DesertVillasII
06.81 CA_PalmDesert_ShadowRidge
10.03 CO_Breckenridge_MountainValley
19.09 FL_FortLauderdale_BeachPlace
06.09 FL_MarcoIsland_CrystalShores
70.91 FL_Miami_Doral
05.00 FL_Orlando_CypressHarbour
16.18 FL_Orlando_GrandeVista
42.32 FL_Orlando_HarborLake
05.44 FL_Orlando_ImperialPalms
05.53 FL_Orlando_LakeshoreReserve
02.05 FL_Orlando_RoyalPalms
07.77 FL_Orlando_SabalPalms
05.63 FL_PalmBeach_OceanaPalms
18.96 FL_PalmBeach_OceanPointe
35.09 FL_PanamaCity_LegendsEdge
05.74 HI_Kauai_BeachClub
08.79 HI_Kauai_Kalanipuu
15.37 HI_Kauai_Waiohai
25.94 HI_Lahaina_OceanClub
21.45 HI_Oahu_KoOlina
15.57 MA_Boston_CustomHouse
12.19 MO_Branson_WillowRidge
16.27 NJ_Absecon_FairwayVillas
30.00 NV_LasVegas_GrandChateau
06.51 SC_HiltonHead_BaronyBeach
03.48 SC_HiltonHead_GrandeOcean
06.51 SC_HiltonHead_HarbourClub
13.31 SC_HiltonHead_HarbourPoint
08.71 SC_HiltonHead_HeritageClub
04.40 SC_HiltonHead_Monarch
03.22 SC_HiltonHead_SunsetPointe
13.13 SC_HiltonHead_SurfWatch
08.46 SC_MyrtleBeach_OceanWatch
39.75 StKitts_BeachClub
11.94 USVI_StThomas_FrenchmansCove
01.29 UT_ParkCity_MountainSide
02.24 UT_ParkCity_SummitWatch
09.57 VA_Williamsburg_ManorClub


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## bjones9942 (May 26, 2011)

My temper always flares a little when people think it's perfectly fine to just up and walk away from a commitment they've made.  The terms 'slacker', 'dead-beat' and 'low-life' come to mind.  To suggest that this is an acceptable way to terminate an agreement, well, that shows exactly what kind of person you are and how trustworthy you are not.

I'm not saying circumstances don't change.  Circumstances extreme enough to warrant walking away from an obligation would better be solved by declaring bankruptcy.  If things are really that bad, this is your legal 'out'.  You have obligations both to the corporation with whom you have a contract, AND the rest of us who suffer from defaults.

And lest you think I'm just an uncaring total ass, here are a few more suggestions for ways to sell:  eBay, Craigslist, Redweek, Classifieds here and timeshareforums.  Start by listing for a buck + closing.  Then try offering for $1 and YOU pay closing.  As a last resort offer for $1 YOU pay closing AND you pay current year maint fees.  More auctions on eBay sell when someone gets a free week out of the deal.  Don't be a slacker!


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## ocdb8r (May 26, 2011)

bjones9942 said:


> I'm not saying circumstances don't change.  Circumstances extreme enough to warrant walking away from an obligation would better be solved by declaring bankruptcy.  If things are really that bad, this is your legal 'out'.  You have obligations both to the corporation with whom you have a contract, AND the rest of us who suffer from defaults.



I totally agree with the sentiment of your post, however I have to point out that default is just as much a "legal" out as is bankruptcy...in fact bankruptcy is nothing more than full scale default on all your financial obligations.  

The bottom line is that in the United States it is not a crime to default on debts.  Contracts provide for remedies in such cases and therefore it is completely legal and acceptable for a party to default, forcing the counterparty to exercise whatever reciprocal rights exist under the contract.  Further, capitalism and US contract law contains many roots embrassing efficient default.  

I know it's a fine line to draw and I am sympathetic to those who feel they are left holding the bag in these situations, however there's nothing illegal (or even immoral IMHO) about cutting your losses under a contract.


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## dioxide45 (May 26, 2011)

One problem is that many people really don't understand how the HOA works. They pay their MF to MVCI. They think that by not paying they are just stiffing the big Marriott company that can afford to absorb those costs. That is not the case, when in fact they are hurting their fellow owners by defaulting.


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## SueDonJ (May 26, 2011)

Thanks for putting that list together, OutAndAbout - interesting stuff there.


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## ronparise (May 26, 2011)

ocdb8r said:


> I totally agree with the sentiment of your post, however I have to point out that default is just as much a "legal" out as is bankruptcy...in fact bankruptcy is nothing more than full scale default on all your financial obligations.
> 
> The bottom line is that in the United States it is not a crime to default on debts.  Contracts provide for remedies in such cases and therefore it is completely legal and acceptable for a party to default, forcing the counterparty to exercise whatever reciprocal rights exist under the contract.  Further, capitalism and US contract law contains many roots embrassing efficient default.
> 
> I know it's a fine line to draw and I am sympathetic to those who feel they are left holding the bag in these situations, however there's nothing illegal (or even immoral IMHO) about cutting your losses under a contract.



There have been several threads in the past here on TUG relating to this issue of default, and foreclosure. This is the best summary of the legality and morality. It is not "illegal or immoral to default"

Said another way; You dont need a "good" reason to default to make it legal. You dont have to be in a position of deciding "is it cat food for my grandmother and pay her mf, or do we default and splurge on  hot dogs"

The folks that cry the loudest here about defaults never seem to accept the legal argument. They always go to the  "morality" of the decision.

Of course there is a negative  effect on the other owners. No one suggests that there isnt. 

Defaults will happen and ultimately the other owners will have to face the problem. Why more associations dont have buy back programs, rental departments and a sales staff is a mystery to me. 

The root of the problem in my view is that blue week owners subsidize the red week owners by paying the same mf for an inferior product (how moral is that?)


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## SueDonJ (May 26, 2011)

ronparise said:


> There have been several threads in the past here on TUG relating to this issue of default, and foreclosure. This is the best summary of the legality and morality. It is not "illegal or immoral to default"
> 
> Said another way; You dont need a "good" reason to default to make it legal. You dont have to be in a position of deciding "is it cat food for my grandmother and pay her mf, or do we default and splurge on  hot dogs"
> 
> ...



Hmmmm.  Just like defaulting I wouldn't call it moral or immoral - it's legal, and that's what matters.

Regardless of what the external resale market commands for seasonal differences, Marriott developer pricing is such that a Plat week can be many thousands more than a Silver week.  If seasonal demand is a legitimate reason to institute sliding scale MF's, because owners of low-demand weeks don't get the same experience in a seasonal location, then the purchase price of all weeks should be the same across the board.  (Not saying that I agree with this, because I think MF should be consistent among all owners if they're all staying in the same units, but only looking for a way to not have owners of high-demand weeks pay more while coming AND going.    )


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## memereDoris (May 26, 2011)

My sister recently has undergone some hard times.  She had not paid her maintenancce fee for the year and was several payments behind when she told me of the situation she was in.  She hadn't bought resale and still owed plenty.

I offered to help find a solution.  I called the resort and told them what was going on and asked them for some help finding a solution.  They downsized her contract to something she could afford.  Instead of ignoring the situation and waiting for them to foreclose, it is better for the resort to have someone else paying those maintenance fees.  The resort can now resell the timeshare she originally owned.  She went from a 2 bedroom lockoff to a 2 bedroom EOY in a different building.  Her debt went from $40,000 down to less than $10,000.  Because we dealt with it, the equity she had built up went towards the new unit.

It never hurts to call and try to make some kind of arrangement.  Do not ignore your obligations, they don't just go away.


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## ronparise (May 26, 2011)

SueDonJ said:


> Hmmmm.  Just like defaulting I wouldn't call it moral or immoral - it's legal, and that's what matters.
> 
> Regardless of what the external resale market commands for seasonal differences, Marriott developer pricing is such that a Plat week can be many thousands more than a Silver week.  If seasonal demand is a legitimate reason to institute sliding scale MF's, because owners of low-demand weeks don't get the same experience in a seasonal location, then the purchase price of all weeks should be the same across the board.  (Not saying that I agree with this, because I think MF should be consistent among all owners if they're all staying in the same units, but only looking for a way to not have owners of high-demand weeks pay more while coming AND going.    )



Susan 

You are absolutely right the legality and the morality dont matter. I just wanted to point out how absurd is the Morality argument.

"What is ; Is" and it's a problem.   In my view the associations are in the best position to deal with it. Just as suggested in the above post by memereDoris. Owners have to deal with their own problems;  in my view thats all the owners through their association


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## larryallen (May 26, 2011)

DeniseM said:


> Westin Ka'anapali Ocean Resort Villas.  That year the maintenance fee was about $2,500 for a 2 bdm.



Not to get off topic onto Westin but a friend/client of mine is trying to get out of her Westin KORV unit as she lost her job, yada, yada, yada.  If I remember right she said the MF's went from $900 a year when she bought 5 or 6 years ago to over $2,500 this year.  Yikes!  There are a number of threads on the Westin board about the Maui tax problem and their huge MF increases. Apparently paying for the defaulting owners is also contributing to the problem! Scary!


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## DeniseM (May 26, 2011)

larryallen said:


> Not to get off topic onto Westin but a friend/client of mine is trying to get out of her Westin KORV unit as she lost her job, yada, yada, yada.  If I remember right she said the MF's went from $900 a year when she bought 5 or 6 years ago to over $2,500 this year.  Yikes!  There are a number of threads on the Westin board about the Maui tax problem and their huge MF increases. Apparently paying for the defaulting owners is also contributing to the problem! Scary!



Yes - the MF has doubled at the resort since I bought pre-construction 8 or 9 years ago, plus the County of Maui is trying to balance the budget on the back of timeshare owners who pay a special property tax rate that is MUCH higher than anyone else on Maui pays.

Larry - Starwood might take a deed-back - has she tried that?


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## e.bram (May 26, 2011)

_personal attack deleted_

If inept and corrupt management cause the mfs to get to point where owning the TS does not make financial sense,  I feel the legal and moral obligation to myself is to bail. If I am legally obligated to pay let the judge decide, morally I will pray for forgiveness.

In as much as the remaining owners have allowed the management to stay in place, I feel no obligation for them.


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## OldPantry (May 26, 2011)

ronparise said:


> Susan
> 
> You are absolutely right the legality and the morality dont matter. I just wanted to point out how absurd is the Morality argument.
> 
> "What is ; Is" and it's a problem.   In my view the associations are in the best position to deal with it. Just as suggested in the above post by memereDoris. Owners have to deal with their own problems;  in my view thats all the owners through their association


Now just a moment.  Legality is one thing, morality another.  When you agree to do something, by signing a legal document, you are making a promise.  Do you really think a promise has no moral content?  What if you promised to pay back your parents, or a very good friend.  Would your agreement have no moral content?  Would it be perfectly OK to stiff them?  Does the morality hinge on whether there's a "personal" connection; i.e., a friend versus an anonymous corporation?  Come on, stiffing somebody because you don't want to pay (as opposed to being unable to pay; which is another thing entirely) is scummy, and people who do it should at least admit that they're scumbags.


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## larryallen (May 26, 2011)

e.bram said:


> Who cares what bjones9942(people from WA are weird) thinks. I don't!
> If inept and corrupt management cause the mfs to get to point where owning the TS does not make financial sense,  I feel the legal and moral obligation to myself is to bail. If I am legally obligated to pay let the judge decide, morally I will pray for forgiveness.
> 
> In as much as the remaining owners have allowed the management to stay in place, I feel no obligation for them.



In my opinion you are confusing legal and moral.  If you morally feel it's ok to bail then your morals are such that I would not want to do business with you (or play golf for money!).


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## bjones9942 (May 26, 2011)

When one makes a commitment to another, via contract or promise, one has a moral, and legal obligation to uphold their end of the bargain.  Religion has nothing to do with this issue, so please let's not bring prayer into this.

Defaulting does NOT release you from your commitment.  Try telling the court that when your creditor sues you for your back maint fees.  Bankruptcy CAN let you walk away.  The difference is that you must present your financial situation to the court and THE COURT will decide the outcome.

Defaulting is never moral.  Screwing other people because you are angry, upset, frightened, or any other rationalization is cowardly.  At least have the huevos to stand up and say 'I didn't want it any more, so I stopped paying.  I don't know you and don't care that you had to pick up my slack'.

When you cause harm (financial or otherwise) to others simply to improve your own situation, the words from my previous post apply to you.  When you don't keep your word (contract) you are not trustworthy.  Frankly, I don't see how anyone could think otherwise, no matter where they happen to reside.

And the definition of default (from dictionary.com) as it pertains to legal matters:
de·fault /dɪˈfɔlt/ [dih-fawlt] –noun
[...] 3.  Law . failure to perform an act or obligation legally required, specially to appear in court or to plead at a time assigned.

Note that it is a FAILURE to follow the law, NOT a legal remedy.


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## ronparise (May 26, 2011)

OldPantry said:


> Now just a moment.  Legality is one thing, morality another.  When you agree to do something, by signing a legal document, you are making a promise.  Do you really think a promise has no moral content?  What if you promised to pay back your parents, or a very good friend.  Would your agreement have no moral content?  Would it be perfectly OK to stiff them?  Does the morality hinge on whether there's a "personal" connection; i.e., a friend versus an anonymous corporation?  Come on, stiffing somebody because you don't want to pay (as opposed to being unable to pay; which is another thing entirely) is scummy, and people who do it should at least admit that they're scumbags.



Thats a great argument and perhaps I am a scumbag, but it dosent change anything, If I feel its the best thing for me Ill admit my mistake Ill consider the consequences, Ill look for a different solution to my problem, but as a last resort Ill default and suffer the consequences. Including wearing the scarlet S (for scumbag) on my forehead.  

We have already establashed that default is a legal remedy.  Im not saying that the  decision to default wont have an effect on others; it will.  Is there a moral component there? probably, but my point is that it dosent matter.  There will be defaults and an association should face that fact and do, what ever they can, to minimize the effect on ownership. Tight management of expenses, improvements to the resort (to improve the value of the blue weeks,) buy backs, resales, rentals etc etc

the defaulting owners may have caused the problem, but the association has to deal with it. The fact that they dont (in some cases) is I think indicative of poor management. which itself may be illegal and immoral


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## OldPantry (May 26, 2011)

OutAndAbout said:


> Here's the Bad Debt Expense for most of the North American & Caribbean Marriott timeshares:
> ...


Yes, this is very interesting information.  For the great majority of Marriott resorts, the charge is minor, but for a few it's becoming a real issue ($71 per owner at Doral, for example).  In time, I do worry that it might become a truly major issue.  One part of it, I'm sure, is mud weeks.  A Myrtle Beach January owner probably feels pretty unmotivated, when he/she is expected to pay the same MF as a platinum owner.  Of course, that's what they agreed to do, but eventually it might become necessary to address their concerns more directly.  Just saying.


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## Ridewithme38 (May 26, 2011)

What are the smaller Resorts 100 rooms? 52 owners per room...the highest MF mentioned was $2500...that 5200 owners...if one owner defaults the cost to the rest is .48cents....theres hardly a moral decision to make between a family losing out on $2500 or making someone else lose out on .48cents...i lose more then that in my car seat on the drive home from work most days...

Yes, there is always more then one person that defaults every year...But thats not what we are talking about here, are we? are we discussing ways to keep large amounts of members from defaulting, or are we talking about it being right or wrong if ONE person defaults?

If you guys are really that upset about .48cents...i don't know if TSing is for you...If its about LARGE GROUPS of people defaulting...well you should talk to your HOA and have them change some things around the resort so the value is there


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## OldPantry (May 26, 2011)

ronparise said:


> Thats a great argument and perhaps I am a scumbag, but it dosent change anything, If I feel its the best thing for me Ill admit my mistake Ill consider the consequences, Ill look for a different solution to my problem, but as a last resort Ill default and suffer the consequences. Including wearing the scarlet S (for scumbag) on my forehead.


I seriously doubt you have the courage to wear that scarlet S.  You'll just do it, and hope nobody notices.  Will you tell your kids?


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## ronparise (May 26, 2011)

OldPantry said:


> Now just a moment.  Legality is one thing, morality another.  When you agree to do something, by signing a legal document, you are making a promise.  Do you really think a promise has no moral content?  What if you promised to pay back your parents, or a very good friend.  Would your agreement have no moral content?  Would it be perfectly OK to stiff them?  Does the morality hinge on whether there's a "personal" connection; i.e., a friend versus an anonymous corporation?  Come on, stiffing somebody because you don't want to pay (as opposed to being unable to pay; which is another thing entirely) is scummy, and people who do it should at least admit that they're scumbags.



Thats a great argument and perhaps I am a scumbag, but it dosent change anything, If I feel its the best thing for me Ill admit my mistake Ill consider the consequences, Ill look for a different solution to my problem, but as a last resort Ill default and suffer the consequences. Including wearing the scarlet S (for scumbag) on my forehead.  

We have already establashed that default is a legal remedy.  Im not saying that the  decision to default wont have an effect on others; it will.  Is there a moral component there? probably, but my point is that it dosent matter.  There will be defaults and an assuciation should face that fact and do, what ever they can, to minimize the effect on ownership. Tight management of expenses, improvements to the resort (to improve the value of the blue weeks,) buy backs, resales, rentals etc etc

the defaulting owners may have caused the problem, but the association has to deal with it. The fact that they dont (in some cases) is I think indicative of poor management. which itself may be illegal and immoral


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## bjones9942 (May 26, 2011)

> We have already establashed that default is a legal remedy.



Repeating this over and over will not make it true.  Again, default is a failure to follow the law, not a legal remedy.


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## bjones9942 (May 26, 2011)

OldPantry said:


> I seriously doubt you have the courage to wear that scarlet S.  You'll just do it, and hope nobody notices.  Will you tell your kids?



I'd do it and say I've changed my name to Steve.


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## OldPantry (May 26, 2011)

Ridewithme38 said:


> What are the smaller Resorts 100 rooms? 52 owners per room...the highest MF mentioned was $2500...that 5200 owners...if one owner defaults the cost to the rest is .48cents....theres hardly a moral decision to make between a family losing out on $2500 or making someone else lose out on .48cents...i lose more then that in my car seat on the drive home from work most days...
> 
> Yes, there is always more then one person that defaults every year...But thats not what we are talking about here, are we? are we discussing ways to keep large amounts of members from defaulting, or are we talking about it being right or wrong if ONE person defaults?
> 
> If you guys are really that upset about .48cents...i don't know if TSing is for you...If its about LARGE GROUPS of people defaulting...well you should talk to your HOA and have them change some things around the resort so the value is there


So, because the collective impact of a given default is small, it's OK to absolve the defaulter?  How about pickpocketing a New Yorker? (It's such a big city, the average citizen is hardly affected ...).  When droves of people default on MFs, won't they all say exactly the same thing?


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## Ridewithme38 (May 26, 2011)

OldPantry said:


> So, because the collective impact of a given default is small, it's OK to absolve the defaulter?  How about pickpocketing a New Yorker? (It's such a big city, the average citizen is hardly affected ...).  When droves of people default on MFs, won't they all say exactly the same thing?



pickpocketing has a much greater impact then .48cents...The point is one or two people defaulting on their MF's is really no big deal...But when droves of people do it, it starts to have a large effect and you have to wonder WHY they are doing it and correcting the problem....With what we are seeing MF's going up sometimes hundreds of dollars because of defaults theres an inherit problem with the system...

Its THAT problem that needs to be fixed, not the one of two odds balls but the object that is causing HUNDREDS of people to default


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## larryallen (May 26, 2011)

WOW!  That's the nicest thing I can say.  Several of you have serious low moral thresholds in MY opinion.  At least the one guy understands he is a scumbag. The 48 cents argument is silly. First, as demonstrated above by Denise it can ADD UP to $250 in her Westin example, and second, the dollar amount doesn't matter. Is it ok to steal a 48 cent item from a store? I mean it's just 48 cents, right?


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## Ridewithme38 (May 26, 2011)

larryallen said:


> WOW!  That's the nicest thing I can say.  Several of you have serious low moral thresholds in MY opinion.  At least the one guy understands he is a scumbag. The 48 cents argument is silly. First, as demonstrated above by Denise it can ADD UP to $250 in her Westin example, and second, the dollar amount doesn't matter. Is it ok to steal a 48 cent item from a store? I mean it's just 48 cents, right?



IF we are talking moral's....its been discussed that it is ok for a starving person to steal a loaf of bread to feed himself if need be....sure its illegal, but morally its been judged to be ok


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## AwayWeGo (May 26, 2011)

*You Typed A Mouthful.*




ronparise said:


> the defaulting owners may have caused the problem, but the association has to deal with it. The fact that they dont (in some cases) is I think indicative of poor management.


You are correct, sir. 

That's why the No. 1 job of timeshare HOA-BODs is collections.  That means prompt, aggressive action against deadbeats -- polite reminders just as soon as they're in arrears, locking'm out of their units till their accounts are up to date, bill collectors, lawyers, & court action up to & including foreclosure.  (Some states reportedly now allow for non-judicial timeshare foreclosures in serious delinquency cases, saving time & expense for the HOA.) 

Of course, ownership & billing records must be accurate & up to date -- an ongoing necessity that's worth what it costs management to maintain. 

Slop in the collections system is a major serious disservice to all the conscientious, responsible timeshare owners out there who reliably pay on time every time. 

I am hard core about this -- just something to keep in mind if you ever have the opportunity to vote for me or against me as a timeshare HOA-BOD candidate. 

_Full Disclosure*:*_  The 1 & only time I was a (self-nominated) candidate for a timeshare HOA-BOD, I got whupped bigtime in the voting & proxy counting.  I no longer own at that timeshare, so now I am no longer even a potential candidate.  (I didn't sell out over pique at losing the election.  We just no longer were using our week as we thought we would when we bought it, so we gave it away _el freebo_ to fellow TUG members.) 

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​


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## Ridewithme38 (May 26, 2011)

Maybe i don't understand what everyone is upset about  

Are you guys this upset about possibly .48cents more on your bill because of one or two people defaulting...then i understand this thread being directed at the owners who are doing that

OR

Are you guys upset about LARGE NUMBERS of people defaulting from the resorts every year? Because the only way to fix that is fix the problems within the resort...its obviously not a person by person thing if there are so many people doing it...Talk to your HOA/BOD's make sure they ASK WHY people are defaulting and ask if there is ANYTHING they can do to help...see if there is anything that can be changed, upgraded, added that will increase the value enough so that they will stay

If you owned a store and you lost one customer, its that customer who left...but if suddenly hundreds stop coming in...you have to realize that its not the customers anymore, its something wrong with your store...One or two people, i understand you guys being upset at the owners that flake out...but when its an epidemic like this, you HAVE to look at the source!!

Meh, maybe my ultra liberal side is coming out a bit too much with this post


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## MALC9990 (May 26, 2011)

Ridewithme38 said:


> IF we are talking moral's....its been discussed that it is ok for a starving person to steal a loaf of bread to feed himself if need be....sure its illegal, but morally its been judged to be ok



I think on balance I am glad that all my weeks are at MVCI resorts which are RTU. So, should it get to a point where I am unable to pay my MFs then after two years of failing to pay, my Right to Use is forfeited and the ownership reverts to MVCI and they pay the back MFs and can resell the week.

I don't plan for or expect this to happen as the MFs are part of my annual budget and as a one time now retired project manager, planning and managing a budget is second nature and my MFs form an important element in the budget.

So in my mind MVCI resorts sold on a RTU basis rather than on a deeded property ownership basis have an inbuilt defence against non-payment of MFs since the responsibility reverts back to MVCI when the weeks are lost and returned to MVCI to resell.


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## e.bram (May 26, 2011)

I would wear the scumbag as a badge of honor. Along with G Washington and T Jefferson(for refusing to pat the tea tax)
An agreement is a two way street, when one side(management) breeches then I on the other side have a right with no compunctions to breech(bail) as well.


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## SueDonJ (May 26, 2011)

bjones9942 said:


> When one makes a commitment to another, via contract or promise, one has a moral, and legal obligation to uphold their end of the bargain.  Religion has nothing to do with this issue, so please let's not bring prayer into this. ...



IMO there's a huge distinction between a promise and a contractual obligation.  A promise (such as the golf game wager mentioned by another poster) requires a moral imperative while a legal contract (such as a timeshare Contract for Purchase and the related governing documents) does not.   



bjones9942 said:


> And the definition of default (from dictionary.com) as it pertains to legal matters:
> de·fault /dɪˈfɔlt/ [dih-fawlt] –noun
> [...] 3.  Law . failure to perform an act or obligation legally required, specially to appear in court or to plead at a time assigned.
> 
> Note that it is a FAILURE to follow the law, NOT a legal remedy.





bjones9942 said:


> Repeating this over and over will not make it true.  Again, default is a failure to follow the law, not a legal remedy.



From freedictionary.com, the first two definitions of default are:
1. Failure to perform a task or fulfill an obligation, especially failure to meet a financial obligation: in default on a loan.
2. _Law_ Failure to make a required court appearance.

It's an important distinction that the second is specific to legal parlance (evidenced by the use of italics) while the first is not.  Because the dictionary specified one and not the other to the law specifically, it can't be said that defaulting on a loan is always a legal issue.  What makes it a legal issue with respect to a timeshare contract (and most every other purchase contract) is that the contract will most likely stipulate consequences should an owner be in default.  Think about it - if the contract doesn't contain such a stipulation, there is no remedy at all for the management company or the other owners to take any actions if defaults occur.  Financial default is meaningless by itself, without the related contract stipulations.

Aside from the legal v. moral argument related to any timeshare issue (which I will never understand because the only remedies for any negative owner or management or developer actions are contractual/legal,) my personal feeling is that I hope owners who can no longer take on the financial obligations of a timeshare do their research and take every action possible to walk away without putting the burden on the other owners.  Not because I think it's the moral thing to do, though - but because I don't want to pay anyone else's share!  But the fact is, the contracts require us to assume those burdens whether the defaulted owners had no choice because of legitimate desperate financial straits, or whether they just walked away because they could.

****
Interesting to note - not all defaulted fees in the Operating Budgets are MF, some are mortgage loans for developer sales.  I'd guess those are the ones that cause the most damages.


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## bjones9942 (May 26, 2011)

e.bram said:


> I would wear the scumbag as a badge of honor. Along with G Washington and T Jefferson(for refusing to pat the tea tax)
> An agreement is a two way street, when one side(management) breeches then I on the other side have a right with no compunctions to breech(bail) as well.



I am in partial agreement.  If you've been holding up your end of the contract by paying your maintenance fees and the resort failed to honor their contractual obligations then you would have every right to sue them to force them to perform.  If they still would or could not perform then you would have a good case for having the courts dissolve your contract.

I don't quite see your connection of the tea tax to defaulting on your contract.  Are you saying that the resort changed the terms (i.e. billing you for something not originally specified or allowed for) of your contract without your approval?  In that case, there is no longer a meeting of the minds, and a court would likely nullify your contract, or force them to perform under the original agreement.  Otherwise, if the management company is performing under the terms of the contract and you just don't like it, well - you only have yourself to blame for entering into the agreement.

In any event, your legal remedy is with the court system - not by defaulting on your contract and burdening the other owners at your resort.


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## ronparise (May 26, 2011)

SueDonJ said:


> ****
> Interesting to note - not all defaulted fees in the Operating Budgets are MF, some are mortgage loans for developer sales.  I'd guess those are the ones that cause the most damages.



I doubt that thats the case. A buyer dosent usually borrow from their HOA to make the purchase

Its mf we are talking about and special assessments


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## bjones9942 (May 26, 2011)

SueDonJ said:


> what makes it a legal issue with respect to a timeshare contract (and most every other purchase contract) is that the contract will most likely stipulate consequences should an owner be in default. Think about it - if the contract doesn't contain such a stipulation, there is no remedy at all for the management company or the other owners to take any actions if defaults occur. Financial default is meaningless by itself, without the related contract stipulations.



I disagree.  A contract is a meeting of the minds between two or more parties.  This can be evidenced in several ways, including both written and verbal (incl. promises) contracts.  When one party fails to perform under the contract/promise, then they are in default and the other party (parties) has/have every right to pursue their performance via the courts.  Promises may be harder to litigate, but if the injured party/parties [plaintiff(s)] can show damages resulting from reliance on the promise then they are likely to either win compensation or forced performance from the defendant(s).

There is ALWAYS an implied consequence of default in a contract - that the courts will force you to perform if/when the other party/parties take action against you.  Not stipulating consequences in a contract in no way removes the right to sue over non-performance.  That's just plain silly.


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## AwayWeGo (May 26, 2011)

*You Have An Excellent Case. Now, How Much Justice Can You Afford ?*




bjones9942 said:


> In any event, your legal remedy is with the court system - not by defaulting on your contract and burdening the other owners at your resort.


Trouble is, some slick & semi-shady timeshare companies out there just dare you to go to court, knowing full well they can easily out lawyer-whip you.  Plus, they know that the attorney fees & court costs you're apt to rack up by pursuing your own legal remedy will cost you more than the value of the legal remedy at issue. 

How do the slick-shady timeshare companies do that ? 

Some of'm by asserting a Right Of 1st Refusal ("ROFR") upon resale that they flat-out don't have, realizing most folks won't know the difference or will be unable to find out, or both. 

Some by sneakily doing _el switcho_ when you try banking your high-value, high-demand prime-season fixed week with a timeshare exchange company.  Only later do you discover that the timeshare company kept your _el primo_ week for itself & instead banked an _el crappo_ week in your name. 

They know they're playing fast & loose.  They also know that the scammed & hornswoggled owners will lie back & take it because the cost of court action will greatly exceed the worth of the bamboozle. 

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​


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## ronparise (May 26, 2011)

Ok

let me come at this from a different direction

Im trying to say that the morals and the legality of a default dont matter to the rest of the owners (and probably not to the defaulter). My lack of morals or my illegal act may upset you and you may be able to send me to jail or to hell, but that dosent solve the problem. You, the association, has a non paying interval to account for

What matters is this association problem and they have to deal with it. They can take action and make changes at the resort to lessen the likelyhood of defaults and they can take action to deal with the defaults when they do happen. But they have to do something. To do nothing is, I think, bad management of the resort and perhaps illegal or immoral itself


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## OldPantry (May 26, 2011)

e.bram said:


> I would wear the scumbag as a badge of honor. Along with G Washington and T Jefferson(for refusing to pat the tea tax)
> An agreement is a two way street, when one side(management) breeches then I on the other side have a right with no compunctions to breech(bail) as well.


So now you turn it into a virtue, worthy of our founding fathers?  Some chutzpah!  They were risking something real, for a real principle, and you're talking about reneging on a contract that you willingly signed.  Scumbag might be your particular badge of honor, but it's not theirs.


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## bjones9942 (May 26, 2011)

AwayWeGo said:


> Trouble is, some slick & semi-shady timeshare companies out there just dare you to go to court, knowing full well they can easily out lawyer-whip you. Plus, they know that the attorney fees & court costs you're apt to rack up by pursuing your own legal remedy will cost you more than the value of the legal remedy at issue.



The small claims filing fee in Washington varies between $14 and $29.  Then there's the fee for service, if applicable.  I think most people would find this affordable.  And I'd enjoy the fun of having some attorney try to lawyer-whip me


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## bjones9942 (May 26, 2011)

ronparise said:


> ...My lack of morals or my illegal act may upset you and you may be able to send me [...] to hell...


Save me a table, order me a drink and we can discuss the various ways we've arrived!



ronparise said:


> ...What matters is this association problem and they have to deal with it. They can take action and make changes at the resort to lessen the likelyhood of defaults and they can take action to deal with the defaults when they do happen. But they have to do something. To do nothing is, I think, bad management of the resort and perhaps illegal or immoral itself



You have actions available to you, other than default, for situations like this.  First, approach the HOA with your concerns.  If that doesn't work, get yourself elected to the HOA and try initiate change.  If that doesn't work, take them to court.  If that doesn't work, put your TS up for sale, and continue to use it, while wearing naught but a speedo, until it sells.  In my case, the HOA would probably rush to buy my TS!

[I've just looked up the legal definition of 'default' in my copy of 'Oran's Dictionary the LAW'.  It states:  1.  A failure to perform a legal duty, observe a promise, or fulfill an obligation.  For example, the word is often used for the failure to make a payment on a debt once it is due.  2.  Failure to take a required step in a lawsuit; for example, to file a paper on time.  Such _default _can sometimes lead to a _default _*judgment *against the side failing to file the paper.]


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## OldPantry (May 26, 2011)

While the morality discussion is fun, it's a bit away from the question I asked when I started the thread.  What is REALLY happening to defaulters?  I suspect it varies from state to state, and HOA to HOA.  Is anybody getting liens (on property like houses or cars); is anybody getting their wages garnished?  Are the real consequences anything worse than a black mark on a credit rating?  If so, how long does that black mark persist?  Curious minds want to know.


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## timeos2 (May 26, 2011)

ronparise said:


> What matters is this association problem and they have to deal with it. They can take action and make changes at the resort to lessen the likelyhood of defaults and they can take action to deal with the defaults when they do happen. But they have to do something. To do nothing is, I think, bad management of the resort and perhaps illegal or immoral itself



If, as is the case in the vast majority of cases, the BOD/Association is following the law and operating the resort to the standards it was built to and doing it as best they can then what, exactly, actions can they do to" make changes at the resort to lessen the likelyhood of defaults"?  It costs what it costs, the law in amny areas say they cannot vary the fees by season and that is what the buyer agreed to.  Why do the majority of owners have to change to meet the whims of the (hopefully) small number that choose to default rather than properly transfer their ownership to a new owner?  Answer - they don't.  

The rules were put in place on day one, they don't change - only the amount owed may.  If everyone could get out of contracts or refuse to pay because the cost isn't what they consider to be "fair" then I doubt another gallon of gas would be sold today as that is clearly a breech of trust and value. They are charging whatever they can and tough for you if you don't like. Try putting it on your charge card and then say you won't pay because "it's too much".  Doesn't work.  You commit to the purchase of a tank of gas or the annual fee of your timeshare/condo.  There is no guarantee of what that cost will be.


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## timeos2 (May 26, 2011)

OldPantry said:


> While the morality discussion is fun, it's a bit away from the question I asked when I started the thread.  What is REALLY happening to defaulters?  I suspect it varies from state to state, and HOA to HOA.  Is anybody getting liens (on property like houses or cars); is anybody getting their wages garnished?  Are the real consequences anything worse than a black mark on a credit rating?  If so, how long does that black mark persist?  Curious minds want to know.



Yes, there are liens placed on the property as well as foreclosures filed.  The black marks can exist up to 7 years or more.  It's not deadly but can hurt.  No garnishments for annual fees (maybe in extreme cases for mortgages but unlikely).


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## OldPantry (May 26, 2011)

timeos2 said:


> Yes, there are liens placed on the property as well as foreclosures filed.  The black marks can exist up to 7 years or more.  It's not deadly but can hurt.  No garnishments for annual fees (maybe in extreme cases for mortgages but unlikely).



Yes, of course a lien on the timeshare.  How about on any other property the defaulter might own?


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## Ridewithme38 (May 26, 2011)

OldPantry said:


> While the morality discussion is fun, it's a bit away from the question I asked when I started the thread.  What is REALLY happening to defaulters?  I suspect it varies from state to state, and HOA to HOA.  Is anybody getting liens (on property like houses or cars); is anybody getting their wages garnished?  Are the real consequences anything worse than a black mark on a credit rating?  If so, how long does that black mark persist?  Curious minds want to know.



alot of times when you go to apply for a job, a new car, a credit card, rent a home or even to refinance you home....they will run your credit report...so what is really happening to people who default of their TS's is they are now unable to find jobs, cars or rent places to live...because the HOA/BOD was unable to keep the value within the resort...these people are now homeless and unable to survive...they become victims of the system and only can survive with the help or the Unemployement and welfare system....alot of people in the welfare system are stuck living in lower income areas and become so depressed that they turn to drugs and alcohol to help them just get through the day...with the high costs of healthcare and addictiveness of drugs they are unable to support their habit because their low credit scores keep them from being able to get a job...these people now begin doing things that they normally would never have done...theft, robbery, murder....and become products of the prision systems in and out for the rest of their lives

All because of an evil TS HOA, who thought it was more important to ruin someones credit then ask how they could help


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## timeos2 (May 26, 2011)

OldPantry said:


> Yes, of course a lien on the timeshare.  How about on any other property the defaulter might own?



No.  Not unless there was a court order and that is unheard of for timeshare fees.


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## AwayWeGo (May 26, 2011)

*You Typed A Mouthful.*




bjones9942 said:


> I'd enjoy the fun of having some attorney try to lawyer-whip me


More power to you. 

Meanwhile, I would greatly enjoy the spectacle of an _el slicko_ timeshare company being brought to heel across the board via sweeping injunction issued by a small claims court. 

Wouldn't that be something ? 

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​


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## SueDonJ (May 26, 2011)

bjones9942 said:


> I disagree.  A contract is a meeting of the minds between two or more parties.  This can be evidenced in several ways, including both written and verbal (incl. promises) contracts.  When one party fails to perform under the contract/promise, then they are in default and the other party (parties) has/have every right to pursue their performance via the courts.  Promises may be harder to litigate, but if the injured party/parties [plaintiff(s)] can show damages resulting from reliance on the promise then they are likely to either win compensation or forced performance from the defendant(s).
> 
> There is ALWAYS an implied consequence of default in a contract - that the courts will force you to perform if/when the other party/parties take action against you.  Not stipulating consequences in a contract in no way removes the right to sue over non-performance.  That's just plain silly.



But we're talking about timeshare obligations and contracts here which DO contain stipulations related to defaults.  There isn't any need to argue for an implied consequence in the absence of stipulated ones.  So the other parties - developer/management company/owners - can pursue through the Court, but what is it going to get them??  Simply, all parties are going to be forced by the Court to comply with the stipulations.  No doubt the judge will rule, "you haven't satisfied your financial obligations and your contract says the developer/HOA can pursue foreclosure and take your timeshare away.  So ordered."  But where does that leave the other owners?  Still in the same place absorbing the costs for those who have defaulted!

The contracts for my timeshares give Marriott/the BOD the rights to spread those costs among the HOA.  If what you're suggesting (not sure here) is that the owners' association could band together and file suit against defaulters for collections, I don't see how the Court would find in favor of the owners when the spread costs stipulation is a part of the contract to which owners agreed.  Especially in the case of defaulters for whom dire financial straits led to the default - you can't get blood from a rock.  Plus, the Court very seldom will rule against a contract unless one of the parties is gaining an artificial advantage through the status quo.  In the particular case of Marriott timeshare resorts and shared MF costs, Marriott as the developer/owner is also assuming the added burden on the intervals they're holding, therefore they are not gaining an artificial advantage.

For me this really is just another issue of legalities with timeshares that do not favor the owners and never will.  Unless the owners can muster the majority vote necessary to force changes to the governing documents, then the owners are pretty much stuck.  Sure we can pressure our BOD's to find some creative solutions, but in the end the fees have to be paid somehow and BOD's are not magicians.

I do agree that defaults are probably the single biggest issue facing timeshare HOA's today, and in the current economic climate it doesn't seem like that is going to change anytime soon.  But I still see it as simply a contract issue, and think that presenting it as a moral issue to gain sympathy votes from the Court or support from the owners is, IMO, a useless endeavor.  Plus, truthfully, I don't want the added burden of piling on to what must already be a mountain of sadness for those in legitimate financial straits, and I don't want the responsibility of judging who is in those straits or not.  It's not exactly a prayer but, "walk a mile in a man's shoes ..."


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## ronparise (May 26, 2011)

timeos2 said:


> If, as is the case in the vast majority of cases, the BOD/Association is following the law and operating the resort to the standards it was built to and doing it as best they can then what, exactly, actions can they do to" make changes at the resort to lessen the likelyhood of defaults"?  It costs what it costs, the law in amny areas say they cannot vary the fees by season and that is what the buyer agreed to.  Why do the majority of owners have to change to meet the whims of the (hopefully) small number that choose to default rather than properly transfer their ownership to a new owner?  Answer - they don't.
> 
> The rules were put in place on day one, they don't change - only the amount owed may.  If everyone could get out of contracts or refuse to pay because the cost isn't what they consider to be "fair" then I doubt another gallon of gas would be sold today as that is clearly a breech of trust and value. They are charging whatever they can and tough for you if you don't like. Try putting it on your charge card and then say you won't pay because "it's too much".  Doesn't work.  You commit to the purchase of a tank of gas or the annual fee of your timeshare/condo.  There is no guarantee of what that cost will be.



John

Of course you are right..I didnt mean to suggest default should be anyones first step..only a last resort, And Im sure an association doesnt have to do anything different than they have always done. 

But it is true that I dont have to pay the fees, you might sic your collections people on me, you might take me to court, you can ruin my credit,  You can even string me up my my thumbs and throw rocks at me but if Im past caring you cant collect.

All Im trying to say is that if there are too many like me you will have a problem.

Is it right that Ive broken a promise, is it right that I stuck you with my debt. is it right. No thats not right, but its a fact and the association has to deal with it

To answer the OPs original question: there may be consequences legal, financial and moral. It will probably be easier and certainly be better to give your timeshare away(perhaps with a financial incentive) than to default on your maintenance fees


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## OldPantry (May 26, 2011)

Ridewithme38 said:


> alot of times when you go to apply for a job, a new car, a credit card, rent a home or even to refinance you home....they will run your credit report...so what is really happening to people who default of their TS's is they are now unable to find jobs, cars or rent places to live...because the HOA/BOD was unable to keep the value within the resort...these people are now homeless and unable to survive...they become victims of the system and only can survive with the help or the Unemployement and welfare system....alot of people in the welfare system are stuck living in lower income areas and become so depressed that they turn to drugs and alcohol to help them just get through the day...with the high costs of healthcare and addictiveness of drugs they are unable to support their habit because their low credit scores keep them from being able to get a job...these people now begin doing things that they normally would never have done...theft, robbery, murder....and become products of the prision systems in and out for the rest of their lives
> 
> All because of an evil TS HOA, who thought it was more important to ruin someones credit then ask how they could help
> 
> ...


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## timeos2 (May 26, 2011)

A well run resort Association realizes that defaults will happen - if we like it or not - and the key is not letting them get out of hand. That is done through a combination of having reasonable fees (as best they can be), resort quality maintained and staying on top of those that do become delinquent by stringent collections up to and including speedy (as fast as allowed) foreclosure.  The last step is having an outlet in place once those foeclosures happen so the other owners aren't on the hook for the fees.  That is a key part too many resorts ignore & they sit on far too much unpaid inventory in the Association name.  They need to actively market that as well as rent what they can.  It is a big job that if ignored can quickly spiral out of control.


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## AwayWeGo (May 26, 2011)

*Live & Learn.*



OldPantry said:


> Not to mention wars, pestilence and the four horsemen of the apocalypse.






-- hotlinked --​
Apocalypse ?

Shux, I thought it was the 4 Horsemen Of The _Acropolis_. 

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​


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## Ridewithme38 (May 26, 2011)

AwayWeGo said:


> -- hotlinked --​
> Apocalypse ?
> 
> Shux, I thought it was the 4 Horsemen Of The _Acropolis_.
> ...



i bet the owners of that TS defaulted on their contracts! That hasn't been maintained at ALL!


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## bjones9942 (May 26, 2011)

SueDonJ -

I think we're approaching this from different perspectives.  I from the point where people are defaulting simply because they're tired of what they have; you from the point that they've become destitute and the cost has become a heavy burden.

I'm also not so sure that a resort would be satisfied with simply foreclosing on the property.  Fees were due and unpaid up until the point of foreclosure and I'm fairly certain they would want to recover.  To my knowledge, the only courts of law that take financial burden into consideration are the bankruptcy courts (ok, sometimes traffic court).  Frankly, this is where I believe anyone in financial trouble should be.  Defaulting on a $50/mo timeshare obligation is not going to dig anyone out of a financial hole.  Bankruptcy has a good chance of doing that.



			
				SueDonJ said:
			
		

> But we're talking about timeshare obligations and contracts here which DO contain stipulations related to defaults.


I was responding to your assertions about the lack of stipulations.  You can't just turn it around on me and now speak to contracts that DO have stipulations.  You'd make a good politician!

I think I've beaten my point of view into the ground.  I'm changing the direction of my energies towards actions that may get me drinks with Ron in hell.  :whoopie:


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## bjones9942 (May 26, 2011)

ridewithme38 said:
			
		

> AwayWeGo said:
> 
> 
> 
> ...



I blame the spring-breakers!  This used to be a great place with a wonderful view!


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## e.bram (May 26, 2011)

Originally Posted by bjones9942 View Post
"I'd enjoy the fun of having some attorney try to lawyer-whip me"

One area where I and bjones agree.
Considering the financials of the potential suit, I don't think John Edwards would take the case.


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## hotcoffee (May 26, 2011)

SueDonJ said:


> . . . I do agree that defaults are probably the single biggest issue facing timeshare HOA's today, and in the current economic climate it doesn't seem like that is going to change anytime soon. . . .



Sticking to my constant gloom-and-doom themes in many of my posts due to an economy that I see progressively getting worse over time (while acknowledging that there will be some up periods in the graph of the downward trend), I cannot imagine the rate of defaults dropping.  In fact, they will probably increase.

One of my concerns is: what happens if someday it becomes impractical to travel to far away timeshares for many of the owners?  I think it might be nearly impossible or the owners to give away those timeshares.  I, for one, would never accept a timeshare that I thought I would be unable to use even if it were given to me absolutely free.  In fact, even if you paid the first year's MFs and all closing costs and offered to give me some cash, I probably would say "no thanks."  I would not want the headache of trying to find someone else to take it off my hands.

What is the likelihood of the above doom-and-gloom scenerio happening?  I think it could happen to the timeshares in the tropics because you have to fly to them.  State-side timeshares might still be worth something to people who can drive to them.  I think timeshares are highly susceptable to economic downturns due to their tending to be relatively far from one's home.

What does all of this have to do with this thread?  My gloom-and-doom outlook for the U.S. economy suggests to me that MF defaults will likely get worse rather than better.


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## OutAndAbout (May 28, 2011)

Ridewithme38 said:


> Maybe i don't understand what everyone is upset about
> 
> Are you guys this upset about possibly .48cents more on your bill because of one or two people defaulting...then i understand this thread being directed at the owners who are doing that
> 
> ...


 Both.  You've made a commitment and there's no excuse to just ignore that commitment without proactively seeking other alternatives, regardless if the commitment is $0.10 or $10.

A perfect example of why there's no excuse not to try to work something out: 





memereDoris said:


> I called the resort and told them what was going on and asked them for some help finding a solution.  They downsized her contract to something she could afford.  Instead of ignoring the situation and waiting for them to foreclose, it is better for the resort to have someone else paying those maintenance fees.  The resort can now resell the timeshare she originally owned.  She went from a 2 bedroom lockoff to a 2 bedroom EOY in a different building.  Her debt went from $40,000 down to less than $10,000.  Because we dealt with it, the equity she had built up went towards the new unit.
> 
> It never hurts to call and try to make some kind of arrangement.  Do not ignore your obligations, they don't just go away.


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## OutAndAbout (May 28, 2011)

SueDonJ said:


> Thanks for putting that list together, OutAndAbout - interesting stuff there.


Note, these number should be taken with grains of salt as there always has to be some assumptions made when backing into totals:
*For states where properties are part of the maint fee, are the taxes part of the default amount?
*Should Bad Debt be included or subtracted from default (possible double-counting)
*Many resorts have 1br/2br/3br villas & these totals are based on the overall average rather than default by unit size
*Maintenance Fees sometimes include, sometimes exclude property taxes, depending on the state
*Maintenance Fees include the developer subsidy & FL club
*etcetera 

The one fact we do know, US$7.6mm in Marriott timeshare defaults budgeted in 2011 (see totals & averages at the bottom)


```
(US$)
[B]BAD DEBT EXPENSE	∑ Bad Debt	Owner	Maintenance  #    Default	
[U]  2010	  2011	    ∆	  2011        Interest	    Fees  Default  Rate  Resort[/U][/B]
 09.00 	 09.01 	   0.1%	 101,180	11,227  1,200.00    84.3   0.8%	Aruba_OceanClub
 02.50 	 05.00 	 100.0%	 115,911	23,175	1,207.82    96.0   0.4%	Aruba_SurfClub
 03.20 	 04.56 	  42.5%	  50,019	10,969	  952.79    52.5   0.5%	AZ_Phoenix_DesertRidge
 07.02 	 19.81 	 182.1%	 255,000	12,875 	  984.35   259.1   2.0%	CA_LakeTahoe_TimberLodge
 13.13 	 13.81 	   5.2%	 474,843	34,384	  877.74   541.0   1.6%	CA_Newport_NewportCoast
 01.25 	 01.25 	   0.0%	  15,045	12,036	1,065.35    14.1   0.1%	CA_PalmDesert_DesertVillasI
 04.88 	 04.88 	   0.0%	 100,050	20,502	  950.72   105.2   0.5%	CA_PalmDesert_DesertVillasII
 06.09 	 06.81 	  11.8%	 174,302	25,595	  957.27   182.1   0.7%	CA_PalmDesert_ShadowRidge
 06.97 	 10.02 	  43.7%	  35,941	 3,588	1,148.45    31.3   0.9%	CO_Breckenridge_MountainValley
 18.94 	 19.09 	   0.8%	 202,526	10,609 	1,137.41   178.1   1.7%	FL_FortLauderdale_BeachPlace
 05.53 	 06.09 	  10.1%	  22,260	 3,656 	1,511.68    14.7   0.4%	FL_MarcoIsland_CrystalShores
 67.52 	 70.91 	   5.0%	 514,948	 7,262 	1,296.93   397.1   5.5%	FL_Miami_Doral
 05.00 	 05.00 	   0.0%	 130,050	26,010 	1,035.99   125.5   0.5%	FL_Orlando_CypressHarbour
 16.18 	 16.18 	   0.0%	 750,073	46,350 	1,094.85   685.1   1.5%	FL_Orlando_GrandeVista
 30.00 	 42.32 	  41.1%	 679,998	16,068 	1,039.26   654.3   4.1%	FL_Orlando_HarborLake
 16.91 	 13.98 	 -17.3%	  32,797 	 2,346 	1,300.56    25.2   1.1%	FL_Orlando_ImperialPalm
 05.61 	 05.53 	  -1.4%	  24,493	 4,429 	1,351.17    18.1   0.4%	FL_Orlando_LakeshoreReserve_
 04.65 	 05.83 	  25.4%	  36,198	 6,209 	1,131.58    32.0   0.5%	FL_Orlando_RoyalPalms
 07.32 	 07.77 	   6.1%	  31,080	 4,000 	1,130.14    27.5   0.7%	FL_Orlando_SabalPalms
 05.63 	 05.63 	   0.0%	  26,391	 4,687 	1,641.91    16.1   0.3%	FL_PalmBeach_OceanaPalms
 17.08 	 18.96 	  11.0%	 333,049	17,562 	1,445.70   230.4   1.3%	FL_PalmBeach_OceanPointe
 09.89 	 35.09 	 254.8%	 150,010	 4,275 	1,270.79   118.0   2.8%	FL_PanamaCity_LegendsEdge
 10.42 	 11.47 	  10.0%	 137,593	12,000 	1,562.54    88.1   0.7%	HI_Kauai_BeachClub
	 08.79 		  13,770	 1,566 	1,775.65     7.8   0.5%	HI_Kauai_Kalanipuu
 15.71 	 15.37 	  -2.2%	 182,000	11,845 	1,547.73   117.6   1.0%	HI_Kauai_Waiohai
 24.04 	 25.94 	   7.9%	 614,564	23,688 	1,876.12   327.6   1.4%	HI_Lahaina_OceanClub
 17.73 	 21.45 	  21.0%	 455,021	21,218 	1,646.03   276.4   1.3%	HI_Oahu_KoOlina
 08.97 	 15.57 	  73.6%	  66,702	 4,284 	1,089.00    61.3   1.4%	MA_Boston_CustomHouse
 10.96 	 12.19 	  11.2%	  82,868	 6,798 	  815.00   101.7   1.5%	MO_Branson_WillowRidge
 16.18 	 16.27 	   0.6%	 150,823	 9,270 	1,011.00   149.2   1.6%	NJ_Absecon_FairwayVillas
 26.00 	 30.00 	  15.4%	 667,000	22,230 	1,015.95   656.5   3.0%	NV_LasVegas_GrandChateau
 06.51 	 03.25 	 -50.1%	  42,266	13,005 	1,000.00    42.3   0.3%	SC_HiltonHead_Barony
 03.39 	 03.48 	   2.7%	  51,469	14,790 	1,084.16    47.5   0.3%	SC_HiltonHead_GrandeOcean
 06.14 	 06.51 	   6.0%	  13,280	 2,040 	1,080.00    12.3   0.6%	SC_HiltonHead_HarbourClub
 12.61 	 13.31 	   5.6%	  57,233	 4,300 	1,047.00    54.7   1.3%	SC_HiltonHead_HarbourPoint
 08.27 	 08.71 	   5.3%	  13,065	 1,500 	1,350.00     9.7   0.6%	SC_HiltonHead_HeritageClub
 04.34 	 04.40 	   1.4%	  27,060	 6,150 	1,048.00    25.8   0.4%	SC_HiltonHead_Monarch
 05.88 	 03.22 	 -45.2%	   4,106	 1,275 	  930.64     4.4   0.3%	SC_HiltonHead_SunsetPointe
 11.34 	 13.13 	  15.8%	 131,869	10,043 	1,071.08   123.1   1.2%	SC_HiltonHead_SurfWatch
 07.50 	 08.46 	  12.8%	 157,288	18,592 	  964.00   163.2   0.9%	SC_MyrtleBeach_OceanWatch
 34.56 	 39.75 	  15.0%	 180,147	 4,532 	1,483.39   121.4   2.7%	StKitts_BeachClub
 11.25 	 11.94 	   6.1%	  95,926	 8,034 	1,297.60    73.9   0.9%	USVI_StThomas_FrenchmansCove
 08.25 	 08.42 	   2.1%	  78,154	 9,282 	  959.85    81.4   0.9%	UT_ParkCity_MountainSide
 02.24 	 02.24 	   0.1%	  15,017	 6,694 	1,128.53    13.3   0.2%	UT_ParkCity_SummitWatch
 04.15 	 09.57 	 130.6%	  97,978	10,238 	  966.00   101.4   1.0%	VA_Williamsburg_ManorClub
									
[B]		       7,591,363       531,188 		 6,548.1 	Total-Sum
 12.29 	 14.29 	  15.4%  168,697         11,804 	1,158.13  245.15   1.2%	Average
[/B]
```


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