Sound familiar to anyone? Timeshare presentation lawsuit

[Jennie]

Where did you get that statistic? I think most people don't know how to do the research to buy a car.

Consumer Reports sells a huge number of their specific model car buying reports each year, at about $25. a pop. Sales of their annual car buying issue in March is a large source of their annual profits. (I've been told this by a good friend who works for the company).

Most people, especially the "younger generation" do a lot of research on the Internet. When they zero in on a particular make and model, they can (and do) receive competitive price quotes by Email from several local dealers. They specify their zip code and all the options they want.

My nephew and 4 of his buddies did a research project on this topic for an MBA class. Two of them went separately from dealer to dealer, in person, and bargained hard for a particular popular car. The other two each asked for on-line quotes. Several local dealerships responded to their inquiry by Email. They then went separately to the dealer who provided the lowest quote, and were offered the vehicle with no attempts to up-sell them, and at the Email quoted price, which was lower than what the in-person buyers were able to negotiate.

When they presented their "exciting" results in class, the other students re-acted in a ho-hum manner, basically saying that the information is "old hat"--that "everyone" knows how to bargain hunt on the Internet.

 

[BocaBum99]

I'm no constitutional expert (and I did not sleep in a Holiday Inn last night either), but it certainly seems to me that the Federales could unilaterally impose a nationwide minimum standard, as they do in numerous other arenas (such as fisheries regulations, for example), which any state could then make more (but never less) restrictive. Maybe I'm mistaken, but it sure seems to me that the Feds could simply decree something like "not less than 7 days" and any and all states would simply have to comply, whether they like it or not. I'm not seeking an argument, but this matter seems to me every bit as much a "consumer contract" issue as a "property rights" issue, since timeshare contracts may (and do) also include RTU's, Club memberships, etc., in which the buyer actually owns no "property" at all in the first place, in whole or in any part...

That's right. Just rip up that document called the Constitution of the US and give powers to the Federal government that they don't have. No problem. Anyone should be able to do it.

As a reminder, the US Constitution establishes government based on Federalism where there is a sharing of power between the national, state and local governments. Each state has its own constitution and their constitutions must be consistent with the US constitution. Our constitution clearly delineates powers exclusively that are for the National Government and those that are Exclusive to the states. And, there are some shared powers.

For instance, printing money is the exclusive power of the National government as is declaring war. Powers that are exclusive to the states include conducting elections, issuing licenses, etc.

One of the EXCLUSIVE powers of the States is regulating intrastate commerce. That includes how real property is transacted. The national government regulates inter-state commerce and creates rules and regulations for commerce between states and international trade. So, as long as a timeshare is sold within a state, the laws for how timeshares are sold and the period of rescission is the EXCLUSIVE domain of the state legislatures.

 

[BocaBum99]

Consumer Reports sells a huge number of their specific model car buying reports each year, at about $25. a pop. Sales of their annual car buying issue in March is a large source of their annual profits. (I've been told this by a good friend who works for the company).

Most people, especially the "younger generation" do a lot of research on the Internet. When they zero in on a particular make and model, they can (and do) receive competitive price quotes by Email from several local dealers. They specify their zip code and all the options they want.

My nephew and 4 of his buddies did a research project on this topic for an MBA class. Two of them went separately from dealer to dealer, in person, and bargained hard for a particular popular car. The other two each asked for on-line quotes. Several local dealerships responded to their inquiry by Email. They then went separately to the dealer who provided the lowest quote, and were offered the vehicle with no attempts to up-sell them, and at the Email quoted price, which was lower than what the in-person buyers were able to negotiate.

When they presented their "exciting" results in class, the other students re-acted in a ho-hum manner, basically saying that the information is "old hat"--that "everyone" knows how to bargain hunt on the Internet.

That's not a statistic. It's a story. What percentage of auto purchasers do "months" of research prior to making a purchase? For your statement to be true, it would have to be more than 90%. To me, almost everyone is certainly more than 90%, probably more like 99%.

The MAJORITY of the country is NOT a subscriber to consumer reports. Not sure why your good friend's statement is relevant to the proof of your assertion that almost everyone does months of research prior to purchasing a car.

 

[dioxide45]

I guess you do not understand the difference between a business decision and a statutory requirement for an irrevocable rescission period.

Lots of business have return 100% guaranteed return policies. That is NOT what I am talking about. What I am talking about is a law the requires a business to provide a 100% return policy for a statutory minimum period of time.

Please name 5 products that have a STATUTORY requirement to have an irrevocable rescission period longer than 10-days. In case you didn't know, irrevocable means you cannot waive that right of rescission.

I have NO problem with business who want to provide 30-day money back guarantees or longer.

Here is the Florida Statute 721.10 regarding cancellation of a timeshare purchase:

However if the TS industry truly believed they had a viable product to sell and stood behind their sales presentations and what is told there, they should have no problem offering a 30 day return period also. They don't, if there was no mandated rescission period, there would be no option for the buyer to back out. Unfortunately they had to be mandated to offer a "refund" policy instead of voluntarily offering it like many other sellers of products do.

 

[theo]

That's right...........No problem. Anyone should be able to do it.

My intention in offering a thought on the matter was not to seek having my input sarcastically belittled, but rather to suggest that some consistency from state to state might help create a more level playing field, where consumers and developers alike increasingly become more knowledgeable (and more cautious) in the murky world and contractual matters of timeshare sales. Maybe that's an idealistic and unattainable goal.

I stated very clearly in advance that I did not (and don't now) claim to be a constitutional expert. I'm happy that you apparently are however; I wish you the best in your new seat on the U.S. Supreme Court...

 

[ace2000]

I don't think anyone is advocating lies and half-truths. I think we are discussing what is a reasonable rescission period.

All lies and misrepresentations should be illegal and prosecuted to the full extent of the law.

This thread was originated with a post describing a lawsuit by someone that stated they were 'pressured' to buy.

 

[Pit]

There is plenty of blame to go around, to be sure. But it takes two to tango. If the buyer isn't *also* making a $10K mistake, there is no sale.

What's more my sense is that most of the misrepresentations are not those of commission, but rather omission---after all, you *can* book July 4th in a six-month platinum season...(if you get on the phone at exactly 8AM the day reservations open, and even then it's not guaranteed.) The operative word is "can", not "will be able to". And, when you read the details, you'll see it's "can" not "will be able to." But, you have to read it.

There certainly are flat-out lies told on the sales floor, and those could well be grounds for cancellation. But, even things this egregious are typically contradicted by what's in the fine print. If you don't have enough time to read the fine print, you should rescind until you do.

I agree with these statements.

I also think that the proper remedy in a situation where the buyer can establish misrepresentation (regardless of the fine print) is to restore the parties to their pre-contractual positions. The buyer gets his money back. The developer gets his timeshare back. No harm done.

The alternative outcome is to permit the developer to profit from lies and deception, which does nothing but encourge more of the same. This is where the industry stands today and why better regulations are, unfortunately, needed. The suggestion to provide a recording of the sales presentation to the buyer is a good idea.

 

[ace2000]

Because we are expressing our opinions, just like you are.

In addition, we are providing more insight into the issues so that people can understand why things are as they are. This will give them an idea of whether or not their desired end state has a snow balls chance in hell.

More importantly, it provides information on who is accountable for what and a model for buyers to protect themselves. This is what we should be teaching in our schools... how to protect ourselves from those who want to scam us.

Here's my problem with all of your legal talk... for me, the issue comes down to whether you side with more constraints against the timeshare sales industry or not, and also whether they are justified in their tactics. It has somehow been hijacked into a legal debate.

You are obviously stating that you're ok with things the way they currently are. I respect that opinion and I've offered my side. Regardless of the way things are right now, it is possible that things can change in the future.

 

[TUGBrian]

Here's my problem with all of your legal talk... for me, the issue comes down to whether you side with more constraints against the timeshare sales industry or not, and also whether they are justified in their tactics. It has somehow been hijacked into a legal debate.

You are obviously stating that you're ok with things the way they currently are. I respect that opinion and I've offered my side. Regardless of the way things are right now, it is possible that things can change in the future.

I still see no "valid" reason that the entire sales presentation shouldnt be recorded.

 

[ace2000]

I still see no "valid" reason that the entire sales presentation shouldnt be recorded.

That would be tough to do on the tour portion of the process...

However, how about requiring a signature on a disclosure form, that very clearly states what the current maintenance fees are, stating that the fees will continue to go higher, and stating that the 'rules' of any given point system or club can be changed at any point in the future? Maybe throw in something about availability and peak periods... That would be a couple of steps in the right direction.

Another disclosure that could be clearly stated is the recission period. I am already aware that a lot of the above-mentioned verbage is buried in the contract that 'everyone' reads.

Real estate transactions do have requirements for similar types of disclosure forms when you purchase a house.

Again, this industry is running rampant with liars and cheats, and they've put themselves into the situation.

 

[richardm]

We are still talking about the famous developer 3 hour tour, that goes all around the resort on a golf cart... The suggestion doesn't seem reasonable or feasible at all.. The same salespeople who lie, would be the same salespeople who have tech problems with their tape recorder or microphone..

Required disclosure is still the best, and only reasonable, manner of consumer protection.. Providing a buyer with a disclosure document that clearly states there is a recission period to allow them time to research the purchase is something simple and non-intrusive.

Developers who try to hide or prevent this disclosure should be reported to the state attorney general, who could then seek action for illegal sales practices..

If you want to have an actual impact, quit trying to reinvent the wheel and start "encouraging" the state AG's to better monitor and investigate these companies..

 

[timeos2]

It would be so simple. And I'll bet things would change for the better

I still see no "valid" reason that the entire sales presentation shouldnt be recorded.

Me neither. I think its the perfect, low cost and absolute answer to a serious issue. If sellers are so confident that they aren't misrepresenting the product and then relying on legalities (the absolute nature of the written documents) then why not have 100% back up with a recording? If they are telling the truth it gives them even more protection against unwarranted complaints of pressure/lies/half truths/etc that seem to haunt them. If they are in fact having trouble "controlling" those things from inadvertently happening with an over zealous sales person (or 2 or 100) then knowing that they are being recorded should put a quick end to the problem. Combined with the existing laws requiring a minimum period to rescind this should be all the protection needed - for BOTH sides.

Yet, for reasons I can only speculate about, not only don't they offer to record the pitch but they, when asked, strictly prohibit it in most (all?) cases! What does that tell you about what they suspect (know?) is actually happening behind the veil of secrecy they are allowing to happen by refusing to let the information be documented. And even the "best" sellers refuse to allow recording. Why? Damning evidence IMO.

 

[e.bram]

In New Jersey, when you purchase real estate you are pushed toward an attorney(not the sellers) review. Should have the same for TSs

 

[1950bing]

A friend of mine who used to sell timeshares said,
" There is nothing wrong with the concept of sharing time for SOME people for vacations. It's the sleezy tell all lies to get people to sign that has ruined the whole image of timeshares. It is very much a buyer beware thing."

 

[e.bram]

BocaBum99:
Yeah, but the TS developer solicits customers from other states(from where the TS is located) and uses interstate communication such as the mail, phone and Internet which makes it subject to interstate commerce and hence Federal control.

 

[BocaBum99]

However if the TS industry truly believed they had a viable product to sell and stood behind their sales presentations and what is told there, they should have no problem offering a 30 day return period also. They don't, if there was no mandated rescission period, there would be no option for the buyer to back out. Unfortunately they had to be mandated to offer a "refund" policy instead of voluntarily offering it like many other sellers of products do.

I agree with you. The timeshare industry has a great product. The problem is how they market and sell it. I don't like the model. I just don't have a better one to replace it. Without this sales and marketing model, there would be no timeshare industry. The real question is this. Are we better off with or without the timeshare industry?

I wouldn't mind having a 30-day return period for just about any product I would offer. Well, food would probably not work.

All I am trying to do is illuminate the issues and considerations for the statutory rescission periods. Looking at all sides of the issue, 7-10 days does seem to be about the right level.

 

[BocaBum99]

I still see no "valid" reason that the entire sales presentation shouldnt be recorded.

The resort developers would come back with the following: "We will agree to record all sales presentations as long as all other industries are required to record all of their sales presentations too."

No other industry would agree to that requirement because they all know that sales people lie.... either intentionally or unintentionally.

 

[BocaBum99]

BocaBum99:
Yeah, but the TS developer solicits customers from other states(from where the TS is located) and uses interstate communication such as the mail, phone and Internet which makes it subject to interstate commerce and hence Federal control.

Most don't. And, for those who do, only a part of their business is governed by inter-state trade. For instance, marketing and sales tax.

 

[TUGBrian]

The resort developers would come back with the following: "We will agree to record all sales presentations as long as all other industries are required to record all of their sales presentations too."

No other industry would agree to that requirement because they all know that sales people lie.... either intentionally or unintentionally.

very few if any other industries have the stigma surrounding sales tactics as the timeshare industry does.

 

[BocaBum99]

A friend of mine who used to sell timeshares said,
" There is nothing wrong with the concept of sharing time for SOME people for vacations. It's the sleezy tell all lies to get people to sign that has ruined the whole image of timeshares. It is very much a buyer beware thing."

This is true. The timeshare sales presentation is just like the game of Survivor. The nature of the game makes even honest people liars and cheaters.

The question is what can be done about it? Well, a lot has been done over the years.

1) companies have been fined for their bait and switch marketing techniques.
2) rescission periods are available everywhere I've looked.
3) mandatory disclosures are common place.
4) secret shoppers shop the resort developers
5) developers have tried to rein in their sales teams from the most egregious lies.

I'm not sure anything more can be done without simply outlawing the timeshare sales presentation in some way like requiring mandatory recordings of sales presentations. I think it would kill the industry. Not sure that would be good or bad or if a new sales and marketing model would emerge to replace the current one.

 

[davidvel]

Sales people in ALL industries lie.

Well then I guess its okay: "Mom, all my friends are doing it..."

 

[Pit]

The resort developers would come back with the following: "We will agree to record all sales presentations as long as all other industries are required to record all of their sales presentations too."

No other industry would agree to that requirement because they all know that sales people lie.... either intentionally or unintentionally.

This needs to be handled by state legislatures. It is neither necessary nor fruitful to negotiate here. If it is state law, the resort developers don't have to agree to it, they just have to do it (as with rescission periods).

 

[davidvel]

The resort developers would come back with the following: "We will agree to record all sales presentations as long as all other industries are required to record all of their sales presentations too."

No other industry would agree to that requirement because they all know that sales people lie.... either intentionally or unintentionally.

If your statement is true, then yes, all consumer sales pitches should be recorded. Unless, of course, you feel its a legitimate practice for ALL SALESPEOPLE TO LIE to customers.

 

[Pit]

I'm not sure anything more can be done without simply outlawing the timeshare sales presentation in some way like requiring mandatory recordings of sales presentations. I think it would kill the industry.

You really don't think it's possible to sell timeshares without resorting to lies and deception? I disagree. There is nothing inherently wrong with the product concept.

 

[BocaBum99]

very few if any other industries have the stigma surrounding sales tactics as the timeshare industry does.

There are plenty.

1) copier dealers
2) used cars
3) electronics
4) legal
5) lobbying / politics / community organizing

And, to a lesser degree, any high tech start up. There's less stigma because they aren't known yet. But, the lies and tales are far more creative and trumped up in high tech.

At the end of the day, we live in a free country where everyone has the right to be stupid. Unfortunately, businesses always emerge to capitalize on those who exercise that right.

For those of you who want to protect the consumer, try to apply your suggested regulations onto any of the above industries. See if they don't squeal like a greased pig when those rules are placed on them.

Rather than over regulating the industries, we need to educate the consumers to be more smart about what they do. That's the real solution.