# Weekly new article: Who runs my timeshare?



## TUGBrian (Apr 9, 2013)

http://tug2.net/timeshare_advice/who_runs_my_timeshare.html


this was a tricky one for me, its hard to encompass enough to be useful, without making it ridiculously long covering each and every possible detail surrounding HOA's

If I have missed anything you feel is important for owners to know, ill gladly add/edit!


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## Ridewithme38 (Apr 9, 2013)

I approve!


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## BocaBum99 (Apr 9, 2013)

Brian,

I don't agree with your article. The owners own the resort, not the board.  The board is a group elected by the owners according the bylaws of the timeshare resort to make key decisions effecting the resort and its operations.  It is instrumental in the hiring and firing of management companies, approving budgets, and other important issues facing the resort, including legal action.

The board's role is very similar to the board of directors in a corporation which is separate and distinct from the management of the firm.

Saying the board is the owner of the resort is like saying the board of directors of a corporation is the owner of that company.  They aren't.  If the company is sold, the owners get the proceeds, not the board unless they also happen to be shareholders which is often times the case.


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## TUGBrian (Apr 9, 2013)

not sure I intended to write it with that slant...i meant to portray the HOA is the owner...the board is merely the elected/approved representative of all owners within the HOA.

if thats not clear, give me some feedback on how to reword it so thats the case.


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## BocaBum99 (Apr 9, 2013)

TUGBrian said:


> not sure I intended to write it with that slant...i meant to portray the HOA is the owner...the board is merely the elected/approved representative of all owners within the HOA.
> 
> if thats not clear, give me some feedback on how to reword it so thats the case.



The Homeowners Association (HOA) is an an organization just like the AARP.   The AARP is an association of retirees, not the retirees themselves.  It's an entity often times incorporated to be separate and distinct from the owners.


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## TUGBrian (Apr 9, 2013)

Id always thought the HOA was incorporated so that the actual developer can "divest" itself (legally for liability sake) from the actual ownership of the resort.

My description was meant to read that the HOA is an entity that all owners are a member of...and acts as the owner/ruler/decision maker on all resort issues.

if thats not how it reads, ill happily reword it with suggestions to make it more clear!~


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## timeos2 (Apr 9, 2013)

I find it factual and quite well presented. It's a little weak in the owner vs developer control of an HOA Board but it is tough to get that concept through to even long time owners. Usually an owner at a Developer controlled & managed resort (be it a good one like Marriott or bad like Westgate) have no real say on management or costs. That isn't stressed clearly in the article & is a critical difference in Developer vs Owner controlled HOA Boards.


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## VegasBella (Apr 9, 2013)

Found a few typos. Want me to share?


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## TUGBrian (Apr 9, 2013)

i just uploaded a new copy with some suggested changes..see if some of your typos/grammar changes were included.


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## Beefnot (Apr 9, 2013)

I forwarded a few more edits which I think will capture about everything. I think there was a clear distinction made between the HOA and the BOD. Didn't get the sense that the BOD was being portrayed as the true owners of the resort.


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## Beefnot (Apr 9, 2013)

timeos2 said:


> I find it factual and quite well presented. It's a little weak in the owner vs developer control of an HOA Board but it is tough to get that concept through to even long time owners. Usually an owner at a Developer controlled & managed resort (be it a good one like Marriott or bad like Westgate) have no real say on management or costs. That isn't stressed clearly in the article & is a critical difference in Developer vs Owner controlled HOA Boards.


 
Are you suggesting reworking to more clearly describe the pros/cons of Developer-controlled vs. true Owner-controlled resorts?


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## VegasBella (Apr 9, 2013)

TUGBrian said:


> i just uploaded a new copy with some suggested changes..see if some of your typos/grammar changes were included.



Refreshed page and found these ones below. 

1. "In essence, every owners at a resort is a member (its not something you can decline) of the HOA and hence has a say in every decision made about the resort" 
should be
In essence, every owner at a resort is a member (it's not something you can decline) of the HOA and hence has a say in every decision made about the resort


2. "Resort have plumbing issues?  that'll be discussed in the HOA meetings"
should be
Resort has plumbing issues?  That'll be discussed in the HOA meetings

3. "I wouldn't hand over my checkbook to them without at least saying my peace!"
should be
I wouldn't hand over my checkbook to them without at least saying my piece!

Also, a style suggestion: it's no longer common practice to put two spaces after a period. That's an old fashioned/ out dated style of writing that's associated with typewriters and not computers.
Reference here: http://www.slate.com/articles/technology/technology/2011/01/space_invaders.single.html


In regards to content. Not sure if timeshare HOAs are dramatically different than regular HOAs for homes but my experience as a home owner and as board member on my HOA leads me to believe the following may be true:

1. I'm guessing that the HOA is not the owner of the entire resort. Rather, the HOA owns only the "common areas" (the pool, the rec room, the landscaping, etc.). The HOA also has the authority to decide on rules for the homes and impose fines, etc. I'm guessing this is true because it's what's true for homes with an HOA.

2. For a home with an HOA, each home is entitled to one vote, not each home owner. That's because some homes have 1 owner and others have 2 or more owners so the way to make it fair is to assign each home a vote. I'm guessing a timeshare is similar and thus there is only *one vote per share and not per owner.*

*All that said, the thesis of the article - that timeshare owners ought to participate in their timeshare HOAs - is spot on EXCELLENT ADVICE. *


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## Beefnot (Apr 9, 2013)

Looks like not all my proposed edits made it in. 

- I think "Resort have plumbing issues?" works better. "Does the" is implied. But either way, "has" or "have", works. 

- The historical "piece"/"peace" debate rages on. Personally, I think "peace" is the more correct term.


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## TUGBrian (Apr 9, 2013)

In most common situations, the HOA for a timeshare resort is an actual corporation that is the legal owner of the resort.

however, it can certainly vary by state as im pretty sure laws vary completely on a state by state basis, and there are no federal laws that cover it that I am aware of.


uploaded the other changes/suggestions, thank you.


(per the piece/peace debate...vs argue it...i just used a different phrase)


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## timeos2 (Apr 9, 2013)

TUGBrian said:


> In most common situations, the HOA for a timeshare resort is an actual corporation that is the legal owner of the resort.
> 
> however, it can certainly vary by state as im pretty sure laws vary completely on a state by state basis, and there are no federal laws that cover it that I am aware of.
> 
> ...



Actually it is usually the reverse. The Association often owns nothing - or only the common areas. The actual physical buildings and land are in fact owned by the XX number of properties the project is divided into be it 20 home plots, 50 trailer / manufactured home lots, 50 condo's in 3 buildings or 8,500 week owners of 150 condo's in 6 buildings. That is why an Association often can't get any loans - they actually own nothing! All they have as "assets" are the future collections from owners. 

The Association exists solely to operate and maintain the property for the OWNERS.  The owners own it!  The Association runs it. The Board makes the decisions for the Association as the elected representatives of the owners. But ultimately the owners are the owners - no one else. Certainly NOT the Association (or Management or Developer - altough many act as if they do as we all know).  

To completely understand what the relationships are I strongly recommend a very readable (for the rather dry subject) book "New Neighborhoods" by Gary A. Poliakoff & Ryan Poliakoff. Available on Amazon. They call it the Consumer's Guide to Condominium, Co-op and HOA Living. It also applies to timeshare (again, timeshares are just condominiums with 52 owners) and these guys helped write many of the condo laws in Florida. They know it cold and write so we end buyers can understand.


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## TUGBrian (Apr 9, 2013)

ill add it to my kindle list! thanks!


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## SMHarman (Apr 11, 2013)

> For all intents and purposes, the actual owner of the Timeshare Resort is the HOA, which is established by the Resort developer for the purposes of maintaining ownership and management of the property in question.  In essence, every owner at a resort is a member (it's not something you can decline) of the HOA and hence has a say in every decision made about the resort, however in most situations a small group of individuals is actually responsible for specifically proposing and voting on these decisions, and this group is defined as the Board of Directors (BOD).


I think this article mixes up ownership and control.
The owners of a timeshare development are the timeshare owners.  You and I have a 1/52xunits share of the ownership of the development.
The control of the development is delegated down to the HOA by the owners and the ownership documents.  The HOA is created, usually as a separate legal entity, to collect dues and pay management expenses of the development.  It is a separate legal entity for logistical and security reasons (you would not want your developer comingling and using them for other developments)
The HOA appoints a board of directors to oversee that control.

This is similar to you owning a share in Apple computers inc.  You own Apple.  You do not control Apple, that is the board of directors.
http://en.wikipedia.org/wiki/Corporation#Ownership_and_control 

In both scenarios you get to vote on who is on the board of directors each year and in both instances you can get majority shareholders that can hold sway over the board.  For HOAs it can be the developer with unsold properties so a larger shareholding than others.  For corporations it can be founders who have a majority stake.



> You, the Timeshare owner are one of the many actual owners of your Timeshare Resort.  As you and the other Timeshare owners are busy, you have a HOA who control and run the resort on your behalf.  The HOA is established by the Resort developer for the purposes of maintaining and managing the property.  The HOA has a say in every decision made about the resort, however in most situations a small group of individuals is actually responsible for specifically proposing and voting on these decisions, and this group is defined as the Board of Directors (BOD).


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## TUGBrian (Apr 11, 2013)

difference in that, is that the BOD of apple are employees hired to those positions, while the BOD at a resort contains actual owners elected to the position.

as I tried to write it...the HOA is who controls the resort...and represents (or at least should) the owners of the resort...as well as being comprised also of owners at the resort.


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## SMHarman (Apr 11, 2013)

TUGBrian said:


> difference in that, is that the BOD of apple are employees hired to those positions, while the BOD at a resort contains actual owners elected to the position.
> 
> as I tried to write it...the HOA is who controls the resort...and represents (or at least should) the owners of the resort...as well as being comprised also of owners at the resort.


The BOD is elected by the shareholders in both instances.  If you directly own stock in a company you will be sent the voting forms each year.
If you own in a mutual fund the mutual fund then they follow proxy voting guidelines to vote on your behalf
https://investor.vanguard.com/about/vanguards-proxy-voting-guidelines
Shareholders can (but usually don't ) vote against the current boards appointments etc.  You can Tim Cook out of his role as Chief Executive of Apple but you would need to get the majority of other shareholders to vote along with you.

While Apple's BOD are compensated in cash, you should remember that the BOD on your HOA is compensated travel and other expenses (i recall a Starwood thread about a big car on this one).  Apple's BOD generally own and are awarded stock so are owners as well as controllers.

You start the piece saying that the HOA owns the resort.  



> For all intents and purposes, the actual owner of the Timeshare Resort is the HOA



They control, not own the asset.  An airline pilot controls the 777 they are flying, they don't own it, the airline (or the leasing bank) own it.  A fighter pilot controls that JSF they are flying, the US Government (and by default, you the taxpayer) own that plane.  You own TUG, control over some sections of the BBS and reviews etc has been delegated by you.

The rest of the article is great.  The opening paragraph confuses ownership and control.  It is IMHO also why TS owners don't take an active involvement in their TS as they don't think of their ownership in the same way as they do a HOA on their planned community or a condo or coop board.


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