Deed / Lease

[DEROS]

I was looking around ebay for selling price of different TS on Ebay and found this for Bay Club at Waikoloa.

Can someone shed some light on this question and answer in Ebay.

Q: If it's deeded why is there only 15 years left? Jul-30-07
A: Timeshares are usually deeded for 25-30 years. This one was for 25 years, and we've used it for the last 10 years. Therefore it has 15 years left on the deed.

I thought there were only two ways to own a TS deeded or lease. However according to the answer above the owners have a deeded lease ownership, which does not make sense to me.

DEROS

 

[BM243923]

Deros

There are 2 kinds of timeshares deeds.

1. is deeded to owner for life and can be passed on to family when you die.

2. 2nd type is right to use which has a time you can use the timeshare and then it goes back to company.

so the one you are looking at has a time that is left then you would not own it anymore.

hope this helps

 

[johnmfaeth]

I have seen many, many examples where Caribbean timeshares are shown on EBay as deeded. The fact is no Caribbean timeshare, other than some in the USVI, are deeded. They are all right to use lease.

This happens elsewhere too, the Caribbean ones are more blatent.

To build on the previous poster, there is a varient of deeded. It is when the ownership is permanent but the legal documents establishing the timeshare require that the owners vote at one or more future points in time to continue as a timeshare or discontinue (which involves selling and dividing up the monies received). In actually, it is VERY rare that this vote even happens for lack of a quorem and the timeshare continues.

 

[dchilds]

Pelican Resort - St Maarten is Deeded

Pelican Resort Club on St Maarten was originally RTU, but they switched to deeded when they had all the legal troubles years ago. It is the only deeded property on St Maarten.

 

[johnmfaeth]

Hi DChilds,

I personally own 4 Pelican weeks which are right to use leases. The issue is that deeding in the Netherlands Antilles is an expensive and long process. While the NA is probably the best on foreign ownership rules, it's not as simple as it is in the US. Lots of additional forms and paperwork required to make sure a buyer is not laundering money.

If you buy a property that is deeded in a British Colony for example, you have to show $2 Million in liquid net worth. That is whether it is a $500,000 house or a $2,000 resale timeshare. Thus the leases.

You may want to recheck the source of your info. If it is a timeshare salesman, it may be an incorrect statement. If you have an actual recorded deed, I'd love to see it (not being sarcastic, I mean that) as I own a closing company and have never seen a Pellican Deed, would be very interesting to see.

Thanks!

John

 

[DEROS]

Update

Just went back to the listing and they changed it from Lease to Deed. They said that they made a mistake about the 25 yr lease.

However, reading the response to my original post, is it possible for someone to Lease a Deeded TS property from somebody? i.e I have a Deed to Bay Club Waikoloa and I leased it for 25yrs to someone.

Is it wrong to ask for a copy of their deed?

Deros

 

[Bill4728]

However, reading the response to my original post, is it possible for someone to Lease a Deeded TS property from somebody? i.e I have a Deed to Bay Club Waikoloa and I leased it for 25yrs to someone.

Is it wrong to ask for a copy of their deed?

Deros

- can you lease a deeded TS from someone? yes, but why would you want to?

- Is it wrong to ask for a copy of their deed? NO, after you have a deal with someone to buy their TS, you varify many pieces of info before continueing.

Was there a loan on the TS and is it paid in full?
Are there any back MF or SA due?
ask for a copy of the deed.
there are several other questions you should ask when buying. for a list of most, there is a article in the TUG advice section to look at.


Good Luck

 

[dchilds]

Pelican - Deed or Lease

Hi John,

My source of deed vs lease (or RTU) was the Pelican sales office.

I pulled out the paperwork from my most recent purchase. The purchase agreement doesn't state anything about deed or lease. It only states "... shall terminate when the useful life of the buildings comprising Pelican Resort Club ends as verified by a licensed engineer or equivalent."

On the owner's section of the Pelican website, it does state that the timeshare owners purchased the resort in 1997.

I don't know where that leaves us.

 

[Lee B]

In Hawaii, for many years most homes were on leased land. It began with 99 year leases. The state cannot overtly coerce landowners to sell to homeowners, but it comes close. Therefore, many landowners and homeowners negotiated buyouts.

Condos are similar, although a lot of them were already built on fee simple land, not leasehold. Those that were on leasehold land meant that the condo owner had a deed to the condo but still paid rent for that fraction of the land that was apportioned to the condo. Many of those condos were timeshared, so now the individual interval owners could buy their tiny share of ownership or continue to rent the land "under the interval."

Perhaps some of this explains the situation that you are looking at now. If the price is right, the rent is right and the ownership is good for most or all of your lifetime, I suggest you buy. If you are certain that you will be wanting that timeshare past the ownership lifetime, then look for something else.

 

[DEROS]

- can you lease a deeded TS from someone? yes, but why would you want to?

- Is it wrong to ask for a copy of their deed? NO, after you have a deal with someone to buy their TS, you verify many pieces of info before continuing.

Good Luck

I wouldn't lease a deeded TS but who knows what other people might do. It could also be a new way to scam people. Convince a TS owner to lease their TS, that is normally a deeded TS, for 5-5 yrs. Then turn around and sell the TS to someone who thinks they are buying a Deeded TS. The lease comes up and the original owner takes back his TS. Of Course the Scam artist has to be good at convincing people that their is no need for a closing company or title company.

After the deal yes, I agree about looking at the Deed. However, what about looking at the Deed before making a deal? If is is not ok, why not?

Deros

 

[johnmfaeth]

Hi Deros,

I have played in this sandbox for quite some time and have never heard of a private lease of a deeded timeshare. I have seen a couple of multi-year rental deals, but if the seller provides a new deed, the resort will recognize you as the new owner. You would then have occupancy the next time the annual week comes up. The rentee would be out of luck.

If a timeshare is leased, it is because the developer sold it that way.

 

[e.bram]

RCI points is a private lease of a TimeShare.

 

[Larry]

I have seen many, many examples where Caribbean timeshares are shown on EBay as deeded. The fact is no Caribbean timeshare, other than some in the USVI, are deeded. They are all right to use lease.

This happens elsewhere too, the Caribbean ones are more blatent.

.

John, most Aruba timeshares are sold in perpetuity. The only deeded timeshare in Aruba is Carribean palm village and that's because it is not built on the beach. All beachfront land in Aruba is public property so all hotels and timeshares are owned but the land on which thay are built are renewable 25 or 30 year leases from the Aruba government. So in effect you own it forever since the leases are renewed automatically otherwise Hyatt, Marriott, Radisson etc. would never spend millions building properties there.

The leases state that in the unlikely event that the leases are not renewed the government must pay the owners current fair market value. All of my Aruba weeks are bought in perpetuity and can be willed.

 

[johnmfaeth]

Hi Larry,

You can have a perpetual lease, not all expire. But they do not constitute a "deed" which is a particular legal instrument. All other ownership types are called "leases".

I own a floating CPV 1 BR and it is also a lease. So are my Divi and LaCabana units on Aruba.

Unless you have a document which is recorded with the government and so stamped by the Recorder of Deeds (or similar entity in a foreign country), you have a lease. A deed will always say at the top XXXX Deed (there are a number of types).

Truth is, unless there is an expiration date of a lease and it is close enough in the future that you can, it does not matter.

Consider a lease to be a "rental" from the developer as opposed to outright ownership. Either way you have the right to use and occupy the unit per the lease duration. .

Again leases are used where deeds are expensive and compicated, or where foreign ownership laws are prohibitive. For example, no timeshare in Mexico is deeded. Foreign ownership laws prohibit them. For a British collony, all are leases becuase to get a deed you must show $2 million liquid net worth. So I'll restate, with the exception a a few properties in the US Virgin Islands, all caribbean timeshares are leases.

As to the owners buying the Pelican, that just means that the public areas are owned by the HOA instead of the developer.

 

[Harry]

I was actually stumped

Golly, I could not figure this one out. First of all to my knowledge all Bay Club is what we call fee simple (you own the factional interest and have a deed from the center of the earth to the top of the sky). Having said this, Hawaii has some strange and interesting property rights dating to king and queen times. Much of Hawaii is what is called leasehold for a period of years in the land only. That is what is happening in Maui with the Sands of Kahana I believe. The leaseholds have expired. But that should not be the case at The Bay Club.

The history of the Bay Club is interesting as well and led me to pause. It was built as a condo by a developer who went belly up. It was taken over by a large Japanese company and converted to timeshares. We own there, and I believe some units were still occupied by owners who had purchased. Some of these owners sold to the developer and may have kept a leasehold in the land. We have been owners for 10 years and I may run for the Board this year, and I have nerver head of this.

 

[DEROS]

The history of the Bay Club is interesting as well and led me to pause. It was built as a condo by a developer who went belly up. It was taken over by a large Japanese company and converted to timeshares. We own there, and I believe some units were still occupied by owners who had purchased. Some of these owners sold to the developer and may have kept a leasehold in the land. We have been owners for 10 years and I may run for the Board this year, and I have nerver head of this.

I guess I will avoid the Bay Club until someone can shed some true light on the matter. Especially after reading this brief history.

Deros