Few Years behind in Maintenance, 40% payment is offered - Thoughts

[SueDonJ]

Yes, I thought about that, too. A well-run resort should be able to find renters for weeks that are in arrears. I disagree with the idea that the reduction in MFs hurts the other owners. The weeks in arrears should have been rented. The Original Poster is looking at paying a couple of thousand in MFs for weeks he never used.

If weeks in arrears are sitting empty, the HOA Board needs to step up and do something to find renters or to find new owners for the unused weeks. If the resort is in such bad shape, or otherwise undesirable, that no renters or new owners can be found, then the HOA Board should consult with the owners about selling the property. Often, state law makes dissolving the timeshare difficult. However, merging with another resort may be an option if there are many unused weeks, and some owners do not want to dissolve the timeshare. Then, one of the two merged timeshares can be sold for the value of the real estate, and the funds used either to buy out some owners (if not quite enough owners want to leave the timeshare organization), or to help fund the remaining resort. Star Island timeshare is near Orlando and the real estate should have value.

I remember the late John Chase was able to merge the resort on Cape Cod where he was HOA Board president with another struggling Cape Cod resort. I believe the resort he managed is now doing well. If that can be done on Cape Cod, it can be done in Orlando.

I very much disagree with the idea of just accepting timeshares as burdens for owners to bear. Possibly, there are situations in other countries where that can happen, but there's really no reason why that should happen in the U.S. If a timeshare is very rundown, or is in an area that no longer attracts vacationers, people who want to leave the timeshare should be allowed to do so. Then, if there are owners who refuse to end the timeshare, they should be the ones stuck with any burden. Owners who want out should not have to subsidize owners who want to stay.

And, by the way, I am not saying this because I personally want out of my timeshares. I own a bunch of timeshares, and I intend to keep owning lots of timeshares.

I'm not heartless. I don't have any problems at all if timeshare management companies work with owners to find solutions when an owner is facing financial difficulties (and is willing to provide proof of such.) I fully expect that there must be an allowance for that, and that a reasonable buffer to cover it is a burden that's absorbed by the other owners.

But honestly, I don't understand the thought process of expecting that when owners simply want out of a timeshare commitment, they should just be able to walk away from the financial responsibility that they willingly accepted! Do you think the same should happen with home mortgages? Car loans? Credit card debt? And/or that the companies should advertise how easy it is to skip a few installments and reduce the debt, especially by the significant amount this OP has been offered? None of that makes any sense to me. I just don't get it. Timeshares are collective ownerships. It shouldn't be easy for owners who are not having financial difficulties to walk away or reduce their burdens at the expense of the other owners.

 

[jndbaseball16]

I'm not heartless. I don't have any problems at all if timeshare management companies work with owners to find solutions when an owner is facing financial difficulties (and is willing to provide proof of such.) I fully expect that there must be an allowance for that, and that a reasonable buffer to cover it is a burden that's absorbed by the other owners.

But honestly, I don't understand the thought process of expecting that when owners simply want out of a timeshare commitment, they should just be able to walk away from the financial responsibility that they willingly accepted! Do you think the same should happen with home mortgages? Car loans? Credit card debt? And/or that the companies should advertise how easy it is to skip a few installments and reduce the debt, especially by the significant amount this OP has been offered? None of that makes any sense to me. I just don't get it. Timeshares are collective ownerships. It shouldn't be easy for owners who are not having financial difficulties to walk away or reduce their burdens at the expense of the other owners.

The one thing that I differ on here (and I'm not arguing), is the walking away. The other items you mentioned that you can't just walk away from will have some value to it and you accept a loss, but you're done. You can buy down your outstanding credit, short sell a home or even sell if for a loss. Same with a car. All of these will give you an 'end in sight' scenario. Timeshares are showing no value and it's tough to give them away. Paying someone to take on this burden may be an option but even that might be a challenge. That is the slight difference with the comparison.

 

[SueDonJ]

The one thing that I differ on here (and I'm not arguing), is the walking away. The other items you mentioned that you can't just walk away from will have some value to it and you accept a loss, but you're done. You can buy down your outstanding credit, short sell a home or even sell if for a loss. Same with a car. All of these will give you an 'end in sight' scenario. Timeshares are showing no value and it's tough to give them away. Paying someone to take on this burden may be an option but even that might be a challenge. That is the slight difference with the comparison.

A couple things.

You can't keep saying, "timeshares are showing no value" as if the situation at your timeshare as you describe it is universal throughout the industry. It's not. There are many, many timeshares being used by very happy owners in a number of creative ways that offer varying vacation options, without costing the owners anything approaching rack rates for similar cash stays. Also many, many timeshares with enough residual value that although recouping original developer prices is impossible, they can be resold for cold, hard cash on the external market or via the original developer/management company. For those who are interested in playing in the timeshare rental market, many timeshares regularly rent for more than the MF's while still providing very good value compared to cash rates for the same intervals via other avenues. Etc etc etc. I'm sympathetic that it appears your particular timeshare doesn't fit the bill to do any of these things but that doesn't mean that no timeshare does. If I'm wrong please correct me but I disagree with the impression that I'm getting reading this thread, that you think the industry needs to adapt and let owners either pay less than the MF's required for upkeep or walk away easily because the industry is imploding. For some of us it simply isn't.

Buying down outstanding credit card debt is not an option until you have suffered dings to your credit. Upside-down mortgages are not all forgiven upon home sales. Car loans are among the most difficult of all credit lines to resolve in the face of financial difficulty. All of these examples are exactly the same as timeshares when it comes to a market not sustaining a product. Timeshares came later to the party of legislative oversight so ownership is not as protected a class, but it's getting there.

I really don't mean to berate you personally for your circumstances - I honestly wish you the best with whatever you want to happen with your timeshare. But this is a recurring topic on TUG and occasionally I just can't help but join in when I've seen one too many posts from owners who don't appear to be taking into consideration that other owners might suffer not just with them, but because of them. That's my perspective, for whatever it's worth.

 

[jndbaseball16]

A couple things.

You can't keep saying, "timeshares are showing no value" as if the situation at your timeshare as you describe it is universal throughout the industry. It's not. There are many, many timeshares being used by very happy owners in a number of creative ways that offer varying vacation options, without costing the owners anything approaching rack rates for similar cash stays. Also many, many timeshares with enough residual value that although recouping original developer prices is impossible, they can be resold for cold, hard cash on the external market or via the original developer/management company. For those who are interested in playing in the timeshare rental market, many timeshares regularly rent for more than the MF's while still providing very good value compared to cash rates for the same intervals via other avenues. Etc etc etc. I'm sympathetic that it appears your particular timeshare doesn't fit the bill to do any of these things but that doesn't mean that no timeshare does. If I'm wrong please correct me but I disagree with the impression that I'm getting reading this thread, that you think the industry needs to adapt and let owners walk away easily because the industry is imploding. For some of us it simply isn't.

Buying down outstanding credit card debt is not an option until you have suffered dings to your credit. Upside-down mortgages are not all forgiven upon home sales. Car loans are among the most difficult of all credit lines to resolve in the face of financial difficulty. All of these examples are exactly the same as timeshares when it comes to a market not sustaining a product. Timeshares came later to the party of legislative oversight so ownership is not as protected a class, but it's getting there.

I really don't mean to berate you personally for your circumstances - I honestly wish you the best with whatever you want to happen with your timeshare. But this is a recurring topic on TUG and occasionally I just can't help but join in when I've seen one too many posts from owners who don't appear to be taking into consideration that other owners might suffer not just with them, but because of them. That's my perspective, for whatever it's worth.

I appreciate your insight. I am opened minded and like to learn. My basis is for 'no value' is looking at all the free/$1 sales on the different sites (even this one) and the length that they have been there. To your point, this is probably not the norm, but it is alarming. It does seem that the point system options are better than fixed week (but I base that again on what I am seeing on sites like this). All in all, I will not default. I am just frustrated at the thought of having to hold on until I find the proper and moral out and not knowing how long that takes. Yes, we all go through life changes and would love an eraser to wipe the slate clean (or part of it).

 

[Panina]

Valid issues on both sides. The bottom line is you have a chance to make it right without effecting your credit rating and having the hassle if they come after you. For a little more, pays closing costs or to find it a new home faster by paying a year of mfs. Think of it as an investment gone bad and a learning experience.

For the record I actual think prime time, prime area fixed week timeshares are the best to keep value and are the easiest to find new homes for.

 

[LannyPC]

I understand the concern many bring up about how an offer like this might set a bad precedent and then other owners might do something like this in order to get a reduction in their MFs. But OTOH, I agree with some who say that it is prudent on the part of the resort/HOA to try to do something to recover at least some MFs. It might also encourage the OP (or any other owners who are behind in MFs) to get "up to date" and continue owning rather than going through the rigours of 1) foreclosing and 2) finding a new owner.

If the OP decides to take this offer and continue to own, then INHO, the discount that's offered is a good price to pay to avoid foreclosure. If the OP decides to take this offer but not wish to own anymore, then the MFs are clear and it will be easier to find a new paying owner knowing that he does not have to absorb the back MFs.

What the resort/HOA is doing is somewhat similar to what some credit card companies do when a debtor has a lot of unpaid debt. Sometimes the CC company will offer a settlement of around 60% of what the debtor owes in order to avoid the expenses and rigours of other means of collection.

 

[sue1947]

I think you are doing everything right. I think somebody will want your unit, especially given it's size. Let us know what happens.

 

[JudyS]

I'm not heartless. I don't have any problems at all if timeshare management companies work with owners to find solutions when an owner is facing financial difficulties (and is willing to provide proof of such.) I fully expect that there must be an allowance for that, and that a reasonable buffer to cover it is a burden that's absorbed by the other owners.

But honestly, I don't understand the thought process of expecting that when owners simply want out of a timeshare commitment, they should just be able to walk away from the financial responsibility that they willingly accepted! Do you think the same should happen with home mortgages? Car loans? Credit card debt? And/or that the companies should advertise how easy it is to skip a few installments and reduce the debt, especially by the significant amount this OP has been offered? None of that makes any sense to me. I just don't get it. Timeshares are collective ownerships. It shouldn't be easy for owners who are not having financial difficulties to walk away or reduce their burdens at the expense of the other owners.

Owners of valueless timeshares should not be forced to subsidize other owners. If a timeshare ownership has no value, it should not exist. Period. The current laws make that difficult to do, but a creative HOA can find a way around the problem.

Cars can be sold. Houses can be sold. There are established resale markets for houses and cars. There is no established resale market for timeshares. The timeshare development companies could establish a resale market, but of course it is contrary to their interests to do so.

Credit card debt does not just magically appear each year -- pay it off, don't charge more, and it's gone for good. Not so with timeshare MFs. Pay them off and they keep coming back, like an especially persistent zombie.

Making it worse, many timeshare owners were tricked into buying the timeshare in the first place. When a person buys a car, the car sales staff doesn't lie and say that it will be worth more in the future as a resale than it is as a new purchase. They don't say you can rent it out as a profit. Timeshare sales staff do.

I love my timeshares, but that is because they have value. If a timeshare ownership has no value, that timeshare ownership should end. There are various ways timeshare companies could do this. They simply don't want to.

It doesn't matter if a timeshare owner could come up with the money by giving up something else they want. People should not be forced to pay for a useless obligation forever. It's happening because the timeshare companies make it happen, and it's wrong.

 

[Panina]

Owners of valueless timeshares should not be forced to subsidize other owners. If a timeshare ownership has no value, it should not exist. Period. The current laws make that difficult to do, but a creative HOA can find a way around the problem.

Cars can be sold. Houses can be sold. There are established resale markets for houses and cars. There is no established resale market for timeshares. The timeshare development companies could establish a resale market, but of course it is contrary to their interests to do so.

Credit card debt does not just magically appear each year -- pay it off, don't charge more, and it's gone for good. Not so with timeshare MFs. Pay them off and they keep coming back, like an especially persistent zombie.

Making it worse, many timeshare owners were tricked into buying the timeshare in the first place. When a person buys a car, the car sales staff doesn't lie and say that it will be worth more in the future as a resale than it is as a new purchase. They don't say you can rent it out as a profit. Timeshare sales staff do.

I love my timeshares, but that is because they have value. If a timeshare ownership has no value, that timeshare ownership should end. There are various ways timeshare companies could do this. They simply don't want to.

It doesn't matter if a timeshare owner could come up with the money by giving up something else they want. People should not be forced to pay for a useless obligation forever. It's happening because the timeshare companies make it happen, and it's wrong.

Whereas I understand your points one item is missing. No one forced the buyer to sign the contract to buy. It is everyones responsibility to themselves to read and understand the ramifications of what they sign. If everyone did the timeshare dilemma some find themselves would not exist. Due dilegence is the responsibility of the buyer. It always baffles me that people do not read what they sign. Maybe our education system needed to teach this.

 

[bluehende]

Whereas I understand your points one item is missing. No one forced the buyer to sign the contract to buy. It is everyones responsibility to themselves to read and understand the ramifications of what they sign. If everyone d

I agree 100% with one caveat. I want the sale office to be held to the same level of accountability. If a consumer has to be responsible for what they sign then the sales force should have to be held accountable for what they say. An honest sales presentation along with an informed decision is what we should all be striving for to help the viability of the industry.

 

[jndbaseball16]

Whereas I understand your points one item is missing. No one forced the buyer to sign the contract to buy. It is everyones responsibility to themselves to read and understand the ramifications of what they sign. If everyone did the timeshare dilemma some find themselves would not exist. Due dilegence is the responsibility of the buyer. It always baffles me that people do not read what they sign. Maybe our education system needed to teach this.

I am a firm believer in this but what you are suggesting is predicting the future of the resale market due to the impact of AirBnB or VRBO among many other options. I'm not sure Due Diligence is the issue here, but unpredictable market conditions 23 years in the future. I believe the TS companies are acting in their best interest to get something instead of nothing. I'm sure there was some rhetoric (verbal) about resale when the situation wasn't suitable anymore, but nothing in writing that said you cannot sell the unit. Assumptions were made.

 

[LannyPC]

I want the sale office to be held to the same level of accountability. If a consumer has to be responsible for what they sign then the sales force should have to be held accountable for what they say.

As much as I like this idea, the trick with this is that the consumer has to be able to prove what the sales people said. If I'm not mistaken (someone can correct me if I am indeed wrong here), the law is like this in some states where what the sales person told the buyer overrides what is in the written contract. The problem, again, is that the buyer has to prove what the sales person said. Unless the buyer/consumer went in with some sort of a recording device and recorded the whole thing, he has a very shaky leg at best on which to stand.

That is one reason why when some people who come on these boards asking about class action suits against TS companies (and their sales people), I, among other people, try to caution them warning that they might not get far if they cannot definitely prove that the sales people said such and such.

 

[bogey21]

Owners of valueless timeshares should not be forced to subsidize other owners. If a timeshare ownership has no value, it should not exist. Period. The current laws make that difficult to do, but a creative HOA can find a way around the problem.

But you bought it. You own it. It is your problem to resolve...

George

 

[bluehende]

As much as I like this idea, the trick with this is that the consumer has to be able to prove what the sales people said. If I'm not mistaken (someone can correct me if I am indeed wrong here), the law is like this in some states where what the sales person told the buyer overrides what is in the written contract. The problem, again, is that the buyer has to prove what the sales person said. Unless the buyer/consumer went in with some sort of a recording device and recorded the whole thing, he has a very shaky leg at best on which to stand.

That is one reason why when some people who come on these boards asking about class action suits against TS companies (and their sales people), I, among other people, try to caution them warning that they might not get far if they cannot definitely prove that the sales people said such and such.

I was thinking more in terms of some form of enforcement. I know it is pie in the sky stuff, but I would love to have a situation where sales would have to back up what they say or be penalized. I know of no other product where you can have unlimited costs with no way to just abandon it. Costs go up with little or no say. Even your kids you can legally get rid of.

 

[theo]

I have always believed (hoped? fantasized?) that a lot of developer sales weasel lies, exaggerations, obfuscations and other assorted misrepresentations could be very effectively undermined or mitigated to a great extent with the addition of one simple written statement of disclosure in large bold print at the end of a contract, directly above the buyer(s) signature line(s). In an ideal world, that statement would say something like:

"Buyer acknowledges by signature(s) below their full understanding that the product being purchased may have little or no monetary value in the secondary (resale) market at any time after purchase and buyer(s) acknowledge their full understanding that any value in the purchased product may be limited solely to its' actual use and enjoyment".

I know that this is a completely unrealistic pipe dream, as developers would fight tooth and nail against any such mandatory honest disclosure regarding resale value. Indeed, most developer sales weasels work very hard to avoid even acknowledging the existence of a resale market at all.

I also realize that too many buyers don't even read what they are signing anyhow once persuaded to drink the kool aid, despite no prior research or any real knowledge regarding important details of their purchase. The fact that so many buyers don't even bother to read (or attempt to exercise) their rescission rights (provided to them in writing right at the time of contract execution) until weeks or months later (...if ever), also speaks volumes.

 

[talkamotta]

When I buy a timeshare I don't want a quit claim I want a warranty deed. It all has to do with guarantees. A quit claim deed doesn't give you any legal guarantees a warranty deed will guarantee that the deed is clear and free of any other obligations or fees.

I know mfs can be a pain especially if the management isn't keeping up on the maintenance of the resorts. But if you didn't pay or even pay attention to the letters they sent you for years...be responsible and pay your obligations. You're lucky they are giving you a break. Sometimes when creditors do that it will show on your credit. Good luck on selling your timeshare. That will cost you to get rid of it, people want closing costs paid by the seller now.

 

[jndbaseball16]

I am happy to say that I have caught up all my MFs (2016 - 2019) for 43% of the total owed. I am not writing this to piss anyone off or gloat. The fact of the matter is, I am currently all caught up (until 2020) and I still feel like there is dark cloud hovering over my head. The good news is I do have a buyer locally and I fully disclosed as much as possible. Things a salesman would not say.
"Maintenance fees yearly until you sell it and which will most likely increase"
"Selling it is not easy and the resale market is almost non existent"
"Exchanging requires some work, but it's doable and here are all the fees involved with that ON TOP of your MFs"
"Don't expect to put a request in for a HOT/Popular location and get it immediately, or at all. Be realistic and manage expectations"
These are just an examples.

I have about as much of a clear conscience as I could at this point and the Quit Claim Deed is sitting on my desk waiting on all signatures. My costs are Quit Claim Deed cost for filing ($19.20), Resort Transfer Fee ($150), One year of Interval International ($89) and first exchange cost ($189) if decided. I think this is a win for both sides.

Thanks for all the input. Keep in mind, I did what I felt I had to do to unload this so that it is not longer a burden to me in the future.

 

[LannyPC]

Things a salesman would not say.
"Maintenance fees yearly until you sell it and which will most likely increase"
"Selling it is not easy and the resale market is almost non existent"
"Exchanging requires some work, but it's doable and here are all the fees involved with that ON TOP of your MFs"
"Don't expect to put a request in for a HOT/Popular location and get it immediately, or at all. Be realistic and manage expectations."

In fact these are the exact opposite of what some sales people would say.

 

[jndbaseball16]

regardless of what people think about the TS industry and moral unloading, I would not feel good without these statements above. I'm not a good salesman