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[ 2019 ] anyone has stopped paying maintenance fees, what happened ?

Fredflintstone

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If your resort won't take it back, there is a bargain forum here where u can give it away. Depending on what resort, season, cost of main. fees per year, you never know, someone may take it. There are many bargains here that are snapped up depending on those factors

I agree. TUG classifieds are a great resource to attempt to rid yourself of your timeshare.

Like I said, try hard to sell your timeshare first.


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RX8

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Foreclosure laws are applicable wherever the timeshare is located. You living in another state does not matter.

From what I know, incorporation in another state does not absolve the timeshare laws to where the timeshare is actually located. It’s like you having a vacation home in California, the real estate laws in California apply regardless of where you live or where you incorporated. The advantage of incorporating in another state only applies to corporate law and income taxes. Property taxes are a local right.

Yes, I understand in Nevada, non judicial, anti deficiency laws apply to only primary residences.

The list is here:

https://www.nolo.com/legal-encyclopedia/how-foreclosure-works-30066-2.html

Remember: A state can have non judicial rules but still allow deficiency judgements. You have to take anti deficiency laws state by state.


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If a timeshare is paid off there shouldn’t be a deficiency anyway so i don’t think that should be a concern. There could be a deficiency with a home through foreclosure and while I am not a tax expert I think there may be tax implications for any debt forgiveness.
 

Fredflintstone

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If a timeshare is paid off there shouldn’t be a deficiency anyway so i don’t think that should be a concern. There could be a deficiency with a home through foreclosure and while I am not a tax expert I think there may be tax implications for any debt forgiveness.

Well not exactly. Timeshare companies would like to add legal fees to process foreclosure, late fees, penalties, etc. With anti deficiency they get nothing except the timeshare. Also with anti deficiency, they cant issue a 1099 forcing you to pay tax on the debt. Having it paid off makes their costs much lower. Anti deficiency also applies to mortgage. In other words, under anti deficiency laws, they eat all of it.


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CalGalTraveler

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Thanks to @Grammarhero for tracking timeshare datapoints. It is disappointing that with all the people TUG has helped that they don't report back. Perhaps, before we help them we should ask for the following datapoints:

1) Location (i.e. Is the timeshare in a non-judicial anti-deficiency state for TS purchases e.g. Calif, Florida, South Carolina?)
2) Is the timeshare independent? If not, what brand? e.g. (MVC, Vistana, Hyatt, HGVC, Diamond/Embarc, Wyndham, Worldmark, HIVC, Bluegreen, Westgate...)
3) Is there an outstanding loan on the unit? (or is it paid off?)
4) How long have you owned the unit? (and paid MF on it)
5) Please report back on the outcome to pay it forward to others in need.
 

CalGalTraveler

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One datapoint in TUG stated that MVC had put a lien on a person's primary home for late MF. How could that be legal without the primary home as collateral? Was a home equity line on the primary home used to pay for the property? However in that case it would be the bank that would have the home as collateral for non-payment of a loan not MVC.

Head-scratcher :ponder:

Perhaps certain states would allow this, however California is a consumer-friendly state. Contractors who work on a home have only a certain number of days (20?) after a contract is signed to notify a homeowner that they have the right to put a lien on a home for non-payment. Most contractors forget and are out of luck if this happens. Given this difficulty for contractors actually working on the home to place a lien, how on earth could MVC do something that is legally enforceable?

Would love to hear from some legal experts.
 
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Fredflintstone

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One case stated that MVC had put a lien on a person's primary home for late MF. How could that be legal without the primary home as collateral? Was a home equity line on the primary home used to pay for the property?

I dont know. I have no details.


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Grammarhero

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One datapoint in TUG stated that MVC had put a lien on a person's primary home for late MF. How could that be legal without the primary home as collateral? Was a home equity line on the primary home used to pay for the property? However in that case it would be the bank that would have the home as collateral for non-payment of a loan not MVC.

Head-scratcher :ponder:

Perhaps certain states would allow this, however California is a consumer-friendly state. Contractors who work on a home have only a certain number of days (20?) after a contract is signed to notify a homeowner that they have the right to put a lien on a home for non-payment. Most contractors forget and are out of luck if this happens. Given this difficulty for contractors actually working on the home to place a lien, how on earth could MVC do something that is legally enforceable?

Would love to hear from some legal experts.
I’m a lawyer. Without knowing more details, the practice was likely legal back then, but may be illegal now.

The OP in this instance likely had a MVC retail TS and a MVC loan or MVC HELOC with carryover clause as to late MF. Laws since then have become more consumer-friendly, likely illegalizing this business tactic.

Now, I do not see how MVC could legally take this approach with TS resale owners, who were not privy to the MVC loan or MVC HELOC in the first place.
 

Fredflintstone

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Excellent points. Individual state laws do vary. I have been involved with a case where the TS sued and hoped they were not challenged so they could get a judgement on the claim. After the response was filed, they dropped the case.

Again, the game is different based on jurisdictions.




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wilbran

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I stopped paying M.F. on Sunset Royal Cancun approx 4 years ago. I did not have a loan. I could not sell. It had lousy trading power. If I wanted to go to Cancun I could rent for less than M.F.. They send me a bill 2 -3 times per year. Always adding late fees, but usually offering to waive those fees if I pay. I do not accept the notion that I am a deadbeat, not paying my obligations. It the resort or association believes the timeshare has any value I will gladly sign any document they need to transfer ownership/RTU back to them. I will not pay to do it. If they decide to sue I will take my chances in a court of law. My situation: Retired, own home, do not need credit.
 

CalGalTraveler

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I stopped paying M.F. on Sunset Royal Cancun approx 4 years ago. I did not have a loan. I could not sell. It had lousy trading power. If I wanted to go to Cancun I could rent for less than M.F.. They send me a bill 2 -3 times per year. Always adding late fees, but usually offering to waive those fees if I pay. I do not accept the notion that I am a deadbeat, not paying my obligations. It the resort or association believes the timeshare has any value I will gladly sign any document they need to transfer ownership/RTU back to them. I will not pay to do it. If they decide to sue I will take my chances in a court of law. My situation: Retired, own home, do not need credit.

Good point. Unless they have an office in the USA, I don't think they can go after your credit or take legal action. I know Villa de Palmar has an office in San Diego and takes payments there, probably for this reason.

There is a Canadian on another thread where Grandview, LV was asking for $2,700 ($3300 CDN) to deed back a 1 bdrm. IMO that is extortion for a property that has only $450/year MF. That's like paying out 6 years of ownership in advance just to deed it back. Yet the developer can turn around and sell or rent it out immediately! Perhaps the Canadian owner could walk similar to the case above because a US entity cannot report to Canadian credit bureaus nor cost-effectively pursue legal action so the owner could avoid this ridiculously high fee if s/he cannot give it away.

@TUGBrian Perhaps ARDA could work on putting a cap on such fees with their promotional program so-called "Responsible Exit?" If not, we need legislation because this is extortion and the industry is promoting "Responsible Exit" to sell more timeshares, but they are not disclosing the inordinately high, uncapped fees to deedback. i.e. the developers get the benefit of selling this industry program but there is no limit as to how much they can charge.
 
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CalGalTraveler

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@Fredflintstone you are Canadian, correct? If so, do you think that the reason they didn't pursue you was that you were Canadian and developer couldn't affect your credit record or cost effectively go after you in a foreign country instead of the anti-deficiency law?
 
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Fredflintstone

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@Fredflintstone you are Canadian, correct? If so, do you think that the reason they didn't pursue you was that you were Canadian and developer couldn't affect your credit record or cost effectively go after you in a foreign country instead of the anti-deficiency law?

Yes and partly. They also knew i knew the laws in Florida because i first tried to deed back and they refused and threatened which was not smart imo (they apparently now take deed backs btw) Credit scores are domestic, they didnt have a signed contract, antideficiency and pursuing would be extremely costly and they would lose in the end. So they went away and looked for the weak deer in the herd.


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Fredflintstone

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In sum, my suggestion is to

1. Try to give your TS away. Use multiple sites.
2. Try to deed back.
3. Research the timeshare laws in the state where the timeshare is located.
4. Get legal advice
5. Move forward based on advice.

Each case is unique.


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Grammarhero

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I stopped paying M.F. on Sunset Royal Cancun approx 4 years ago. I did not have a loan. I could not sell. It had lousy trading power. If I wanted to go to Cancun I could rent for less than M.F.. They send me a bill 2 -3 times per year. Always adding late fees, but usually offering to waive those fees if I pay. I do not accept the notion that I am a deadbeat, not paying my obligations. It the resort or association believes the timeshare has any value I will gladly sign any document they need to transfer ownership/RTU back to them. I will not pay to do it. If they decide to sue I will take my chances in a court of law. My situation: Retired, own home, do not need credit.
Did your credit get affected?
 

Grammarhero

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So far. The stats are: 7 out of 13 for their credit affected. 4 out of 9 for Ts without loans. 3 out of 4 for Ts with loans. Big difference for those with or without loans.
 

Fredflintstone

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No. There was no negative report to a credit agency.m

I will say on the outset, I know nothing about Mexican timeshare laws. I am wondering if a Mexican timeshare cannot affect credit because credit is domestic.

Also, I am unsure how they deal with out of country owners. I remember someone mentioning they have offices in the US. I am unsure if that matters.

My guess and ONLY MY GUESS is they are all bark and no bite when people stop paying. I suppose they can file a claim and hope to god there is no response so they can get a judgement?

I could be wrong on this. Maybe someone can shed light on this.


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Fredflintstone

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So far. The stats are: 7 out of 13 for their credit affected. 4 out of 9 for Ts without loans. 3 out of 4 for Ts with loans. Big difference for those with or without loans.

That makes a lot of sense. The problem compounds when you have a loan since you agreed to have your payment habits shared with the Credit Bureaus through the loan agreement. Plus, they have all key data (like DOB) to access your credit file easily. When you pay in full it is much harder especially when it is resale as they don’t have key data like DOB to access your file. And yes, being in another country makes it virtually impossible.


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Fredflintstone

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Good point. Unless they have an office in the USA, I don't think they can go after your credit or take legal action. I know Villa de Palmar has an office in San Diego and takes payments there, probably for this reason.

There is a Canadian on another thread where Grandview, LV was asking for $2,700 ($3300 CDN) to deed back a 1 bdrm. IMO that is extortion for a property that has only $450/year MF. That's like paying out 6 years of ownership in advance just to deed it back. Yet the developer can turn around and sell or rent it out immediately! Perhaps the Canadian owner could walk similar to the case above because a US entity cannot report to Canadian credit bureaus nor cost-effectively pursue legal action so the owner could avoid this ridiculously high fee if s/he cannot give it away.

@TUGBrian Perhaps ARDA could work on putting a cap on such fees with their promotional program so-called "Responsible Exit?" If not, we need legislation because this is extortion and the industry is promoting "Responsible Exit" to sell more timeshares, but they are not disclosing the inordinately high, uncapped fees to deedback. i.e. the developers get the benefit of selling this industry program but there is no limit as to how much they can charge.

I think the illusion is these folks will cause you plenty of pain if you don’t do “responsible exit”. I personally know of 3 Canadians who stopped paying and after 2 years of hassle, they just foreclosed. No issues.

In my view, these guys whip crack and try to Instill fear to make people think they are over the barrel. The reality is chasing people (especially out of country) is very expensive, has risks and frankly counterproductive. I know in my case, if the TS was reasonable, I would have been much more civil too and pay a reasonable fee to take the deed back. Sadly, from my experience, their arrogance resulted in them losing much more than if they were reasonable.

In my case, when entities threaten me I just tell them to bring it on and then I shut the door and see if the court papers hit my desk which I am more than happy to deal with.

The recent deed back programs are a great first step in making the process more civil. You get more bees with honey.


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jacknsara

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The 3 best states for non judicial, anti deficiency WHEN IT APPLIES TO TIMESHARES is Florida, South Carolina and California. In California, look here (page 27):

http://www.dre.ca.gov/files/pdf/timeshare_manual.pdf

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I’m not a lawyer and this is not legal advice.
I just looked up Hawai’i non judicial anti deficiency foreclosure:
Hawaii does have an anti-deficiency law, but it only applies to nonjudicial foreclosures. (Haw. Rev. Stat. § 667-38). Deficiency judgments are allowed in judicial foreclosures.
upload_2019-10-27_17-5-25.png

AllLaw › articles › nolo › laws-in-h...
Hawaii Home Foreclosure Laws | AllLaw
 

Fredflintstone

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I’m not a lawyer and this is not legal advice.
I just looked up Hawai’i non judicial anti deficiency foreclosure:
Hawaii does have an anti-deficiency law, but it only applies to nonjudicial foreclosures. (Haw. Rev. Stat. § 667-38). Deficiency judgments are allowed in judicial foreclosures.
View attachment 14804
AllLaw › articles › nolo › laws-in-h...
Hawaii Home Foreclosure Laws | AllLaw

Yes, state laws on timeshares vary. Some are non judicial, deficiency...some not. A few are Judicial and I think all judicial allow deficiency. Judicial foreclosures are much more time consuming and expensive than non judicial. Non judicial are frankly just a paper chase as there is no court intervention. Whenever courts are involved, costs do go up.

Oh and some states are a blend...judicial in some cases and non judicial in others.

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Grammarhero

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Fredflintstone

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More legal research required.
It looks like Alaska, Minnesota, Montana, Oregon, or Washington might also have some anti-deficiency statutes. Of those, only Montana is a big TS state.

https://www.alllaw.com/articles/nolo/foreclosure/anti-deficiency-laws.html

Yes, and the limitation in deficiency vary when it comes to timeshares. Eg. Nevada has anti deficiency statutes but they only apply to principal residences but not timeshares.


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