Deeding Back Timeshares

[timeos2]

Not the associations problem to address

Awareness that even some moderators at TUG (a place that you had come to trust for good advise) understand your plight and the risks involved for the TS, but don't propose solutions because of their own self interests.

The problem is some want to make a bad decision by an owner the problem of the other owners. It is similar to those that think the exchange co's have to create value from worthless weeks.

The buyer is the one who needs to find a solution. If the Association wants to do whatever they can great. But if it costs others they have to offer it to all or none.

 

[JMAESD84]

The problem is some want to make a bad decision by an owner the problem of the other owners.

By 'bad decision" I assume you mean purchasing a "dog" week in the first place. Most all of the units at a TS were originally purchased by folks who may not have made a wise purchase decision.

Not recognizing and addressing that an evolving and growing problem that is significant for some owners at the TS may end up being a major problem for all owners, will prevent resolving the problem in an effective and proactive way. The first step in solving a problem is recognizing that there is a problem and it needs to be corrected.

If your hope is that the individual "dog" week owners will resolve "their" problem on their own and in a way that is considerate of the remaining owners, you might be dissapointed when they don't care to consider the consequence of the situation to "the other owners" when "the other owners" didn't care to consider and address the consequences of the "dog" owners plight.

Awareness that a personal solution exists for "dog" week owners that has devestating consequences to the TS, should be enough to encourage the BOD to be more considerate and proactive:

LEGALLY TRANSFER THE DEED TO SOMEONE WHO WON"T PAY AND IS IMMUNE TO THE COLLECTION and FORECLOSURE PROCESS.

 

[AwayWeGo]

And Not Just Bad Decsions . . .

The problem is some want to make a bad decision by an owner the problem of the other owners.

. . . but also decisions that were OK at the time they were acted upon but that turned out to turn unfavorable some time down the road -- unforeseeable, maybe, but that's life. In any case, it's the individual owner's problem, not the HOA-BOD's problem.

See, the thing about the timeshare HOA-BOD is, it's not them -- it's us.

In the case of independent, owner-controlled timeshares no longer managed by the Developer Of Record, the HOA-BOD is not some money-grubbing, profit-making corporation -- it's the unpaid volunteer elected representatives of the regular walking-around, timeshare-owning, TUG-BBS-reading individual owners like you & me.

Independent, owner-controlled timeshares are not money-making operations. They are in operation to provide the best vacation resort experience they can at the most reasonable costs they can wangle in the best interests of all the owners, while doing all they can to solidify the resort's financial position -- including socking away reasonable cash reserves for scheduled major renovations & modernizations.

Stiffing the HOA-BOD means stiffing all of us responsible, fee-paying timeshare owners. When somebody goes delinquent on timeshare fees & assessments, it's not some Wall Street fat cats that take the hit. It's you & me & everybody else who owns at that timeshare where the fees we all pay go up because of other people's unpaid bills.

It's the HOA-BOD's job to look out for the interests of the responsible, fee-paying owners -- not to bail out folks who made bad decisions, or whose circumstances later change unforeseeably in ways making them want to bail out of their timeshare-ownership obligations.

I mean, shux, that's just how it is -- & it's not exactly rocket surgery.

Sheesh.

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

 

[Jya-Ning]

That will be nice

Push it to local real estate agent to make it law. It will be nice. So all the sub-pime borrowers can get get out of their mess with no damage at all. And they can immediate repurchase another house if they desire too. You can also apply all the technique you suggest to transfer your liability to someone or something that can not be liable.

Alas, no matter how you look at it, it will be case by case, and I don't believe any system will allow people get out that easy.

Jya-Ning

 

[chris5]

The developer sells us a product. Then the developer or a third party will maintain the property at a cost - our MFs. Isn't that a lot like many businesses? A car manufacturer sells us a car. Then, at a cost, the car manufacturer or a third party (at our option) will maintain it for us. We don't even think of suggesting that the manufacturer come get it and haul it away if it breaks down or otherwise has no value to us. What's so different about a timeshare that suggests the developer or HOA should take it back?

AS I SAID EARLIER, AND AS YOU IGNORED, I SAID WHEN A CAR IS PAID OFF, ONE CAN GET RID OF IT. I AM TALKING ABOUT PAID OFF TIMESHARES.

Help me out Kurt, is there really such a thing as a "paid off timeshare"? The timeshare is bundled with an owner obligation to pay maintenance fees in perpetuity unless legally transferred to another person or unless the resort/obligee no longer exists. So, no timeshare is fully paid off -- and every other condominium or cooperative ownership interest operates precisely the same way -- if there are other owners still standing behind their own units and the common property interest.

The fact that the purchase price for a timeshare has been fully extinguished does not really help anyone's analysis of the situation; a legal obligation still exists for payment of fees. I don't think that it makes any sense for a HOA to extinguish that financial and legal obligation merely because the owner says it does not want to pay the maintenance fees anymore, but likewise I don't think it makes any sense for a HOA to try to collect fees from a judgment proof debtor and incur additional expenses in futile collection efforts.

 

[rickandcindy23]

I believe there is value in an off-season week and that the responsibility is on the HOA Board to help owners figure it out, especially when those assessments start coming. We have had so many people at Twin Rivers just bail out through Timeshare Relief and other PCC's, simply because they don't know about the exchange system.

My goal for my resort, being on the board, is to let blue/green week owners know about last-minute exchanges. We are lucky in the Colorado Rocky Mountains to have our weeks valued as red for summer and prime red for winter, with only about 12 weeks that are off-season. We don't have very many unhappy owners, but we do have

Someone said that the answer to off-season weeks is a points system, like the RCI's points system. I think a points system can work to add value, but it does not work all that much better than a blue/green week works in the current weeks system, for last-minute trades. If you own a blue/green week and RCI gives you enough points for two "9,000 points or less" vacations, there are only going to be a few choices (points resorts are not available at all); whereas using weeks, you can exchange into anything RCI has to offer at the last minute.

Funny that all of my friends who rent hotel rooms (crazy) only start looking a week or two out, yet we think last-minute exchanges are risky. C'mon!

 

[bugzapper]

Renting last minute weeks can be cheaper

I believe there is value in an off-season week and that the responsibility is on the HOA Board to help owners figure it out, especially when those assessments start coming. We have had so many people at Twin Rivers just bail out through Timeshare Relief and other PCC's, simply because they don't know about the exchange system.

My goal for my resort, being on the board, is to let blue/green week owners know about last-minute exchanges. We are lucky in the Colorado Rocky Mountains to have our weeks valued as red for summer and prime red for winter, with only about 12 weeks that are off-season. We don't have very many unhappy owners, but we do have

Someone said that the answer to off-season weeks is a points system, like the RCI's points system. I think a points system can work to add value, but it does not work all that much better than a blue/green week works in the current weeks system, for last-minute trades. If you own a blue/green week and RCI gives you enough points for two "9,000 points or less" vacations, there are only going to be a few choices (points resorts are not available at all); whereas using weeks, you can exchange into anything RCI has to offer at the last minute.

Funny that all of my friends who rent hotel rooms (crazy) only start looking a week or two out, yet we think last-minute exchanges are risky. C'mon!

Cindy, Why would owners at Twin Rivers want to pay $504 + II exchange fee + II membership fee for a last minute exchange when they can find an equivalent RCI rental for less than half the cost? I went to Orlando for fall break and stayed in a very nice 2 bedroom unit at a gold crown resort. It cost me $216. My $216 also bought me a $100 gift certificate that we used at a nice restaurant, so my week actually cost $116. I was able to reserve this unit four months before my vacation, so I could purchase airfare without risk. This was not a fluke. I could get the entire month of January in Orlando for less than $1000, staying at some very nice resorts--and I have never had membership with an exchange company. Why would I possibly want to buy an off-season week unless I intended to use it myself?

Keith

 

[somerville]

I don't believe that an HOA has a responsibility to accept deed backs, but I do believe that it is to the resort HOA's advantage to encourage some sort of resale program. I own at Peppertree by the Sea in N. Myrtle Beach and Bay Club Waikola. Both resorts have some sort of on site resale program. I do not know if the resorts pay anything for the program, other than providing space. Hopefully, the programs are sustained by sales commissions. Peppertree by the Sea is an SPM managed resort. They have an affiliate, Palmetto Marketing, that runs the resale program at all of their resorts. I think they provide resale services to non-SPM managed resort too. Here is a link to their website: http://www.palmettomarketing.com

 

[chris5]

Perhaps your car example was not addressed because it is mostly irrelevant. If you insist on a car example, consider the following:

Fred, George, Ginny and Ron individually do not have the resources to purchase a car and succeed in pooling their cash to buy a new one, without a loan. They have agreed that each will take turns using the car and they will share the maintenance costs. They have agreed that Fred would use the car in the morning, and so he uses it to drive to class every day. George gets it for the afternoon and drives himself to work. Ginny takes the evening shift and uses it to drive to all of her social activities. Ron has it during the wee hours of the morning, using it to get to his graveyard shift. Ron knows he won't use the car on the weekends, but since the cost of his share was a little less than the others, he doesn't mind too much. They are each thrilled to have the increased freedom the car provides.

The years go by and they put many miles on the poor little car. George and Ginny no longer use the car for themselves and use it to generate income as a taxi. Ron no longer works the graveyard shift and has no need of the car. In their city, there is little demand for taxi service during the wee hours of the morning. Ron would love to sell the car, but every time he suggests doing so, he is outvoted by the other three. Now that the car has hundreds of thousands of miles, the maintenance costs are many times what they were when the car was new. Ron realizes that he is paying for repairs on a car so that others may use it. His attempts to sell his interest in the car fail. Ron offers to give his share of the car to the other three owners, but they wisely hold Ron to his original commitment. After all, didn't Ron knowingly agree to participate in the maintenance of the vehicle? Besides, how would it be possible for George and Ginny to make money from their taxi service if they didn't receive Ron's cash? How could they afford to restore the car to its original luster if Ron didn't contribute his share?

Over time, Ron has become incensed at the patent unfairness of his situation, realizing that he is essentially giving his money to the other owners, but he sees no way to find release except through the good graces of the other three.

What about Fred? At the time each of them committed to this arrangement, each must have considered it a good deal. Circumstances change and, in retrospect, this became a better arrangement for some and a terrible arrangement for others.

But where is the "patent unfairness" of this arrangement? I guess you lost me on this one. Ron might feel this is unfair but it is no more unfair than anyone agreeing to a financial condition that turns out badly. Isn't this what it's all about, at bottom!

 

[rickandcindy23]

Cindy, Why would owners at Twin Rivers want to pay $504 + II exchange fee + II membership fee for a last minute exchange when they can find an equivalent RCI rental for less than half the cost? I went to Orlando for fall break and stayed in a very nice 2 bedroom unit at a gold crown resort. It cost me $216. My $216 also bought me a $100 gift certificate that we used at a nice restaurant, so my week actually cost $116. I was able to reserve this unit four months before my vacation, so I could purchase airfare without risk. This was not a fluke. I could get the entire month of January in Orlando for less than $1000, staying at some very nice resorts--and I have never had membership with an exchange company. Why would I possibly want to buy an off-season week unless I intended to use it myself?

Keith

What are you proposing, that we all sell our weeks and go to Orlando with RCI's rental bargains?

The reason owners would want to keep their green weeks (we are with II) is that at least you don't have to settle for a hotel room in Orlando or Hawaii. There are some very nice trades out there, and I am not just talking about Orlando (you can get there in the summer with a green/blue week easily, which you cannot rent cheaply. This is the reason a person should never buy Orlando).

 

[AwayWeGo]

Shux, Why Sell ?

What are you proposing, that we all sell our weeks and go to Orlando with RCI's rental bargains?

That is not necessary.

Instead, folks can rent out their timeshare weeks (Orlando & elsewhere, mox nix) & then go Orlando with RCI's rental bargains. (Instant Exchange & Last Call, actually, but no need to quibble over terminology.)

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

 

[Carolinian]

Having watched the impact of both of the strategies outlined in this thread on HOA's and their members on the OBX, I agree with Kurt completely.

Under its long-time, but recently fired management company, Dunes South rigorously pursued the strategy outlined by John, refusing or at least highly discouraging deadbacks, using bad credit reports to punish deadbeats, getting nasty on the phone with deadbeats, and letting non-producing weeks fester for multiple years before foreclosing. The result is some of the highest m/f's on the OBX, more deferred manintenance than any resort there I can think of ouside of the BIS resorts, a huge backlog of unsold weeks, frequent special assessments, and even a backlog of foreclosures that need to be done. Fortunately, the HOA board has risen to the occaision and made a management change.

On the other hand, a good example the other direction is Ocean Villas, which will accept a deedback, no questions asked, but does not go out of its way to advertise this to members so as not to encourage use of this safety valve. The result is less foreclosure expense to the HOA, no special assessment in years (and just two in the resort's twenty five year history), one of the more reasonable m/f's on the OBX, sufficient reserves, no deferred maintenance, considerable attention to resort and unit updates including LCD flat panel TV's installed in all master bedrooms and free wi-fi, and a solid turnover record of getting HOA inventory back in the hands of new owners.

Of course, there are some differences in other areas such as maintenance where Dunes South used a maintenance company owned by the husband of the owner of its management company, while Ocean Villas uses member volunteers of its maintenance committee to supplement paid maintenance work.

Generally from what I see, the better managed resorts are the ones that accept deedbacks. Deedbacks are quicker and much cheaper than foreclosures and allow resorts to get weeks back into the hands of m/f-paying owners much quicker and much more cheaply for the HOA, which is the real bottom line.

The other key is staying on top of your accounts receivable and trying to work with people constructively.

 

[rickandcindy23]

Carolinian,
A resort must have a strategy for selling or giving away the blue/green weeks. We have about 75 blue/green weeks in inventory at Twin Rivers. Knowledge is the key to getting someone to want these weeks. I plan to market them to current owners for trading purposes. I still think last-minute opportunities are amazing.

 

[Carolinian]

Carolinian,
A resort must have a strategy for selling or giving away the blue/green weeks. We have about 75 blue/green weeks in inventory at Twin Rivers. Knowledge is the key to getting someone to want these weeks. I plan to market them to current owners for trading purposes. I still think last-minute opportunities are amazing.

That is absolutely correct. Resorts need to identify markets and means to sell weeks. On the OBX, several HOA's use the local t/s rental/resale agency Outer Banks Resort Rentals, with fairly good success. Others do more in-house marketing. Seascape, which is beside a golf course where its members have golf priveleges, does a good job in marketing off season weeks to golfers. Outer Banks Beach Club I and II has targeted local residents with good success, since ownership gives them use of the facilities yearround. Some other resorts have also tapped this market, but OBBC is the king of it. Ocean Villas has had some success marketing to duck hunters since deep low season happens to correspond with duck hunting season and there are a large number of duck blinds on the federal seashore a few miles away. Given the current climate at RCI, IMHO marketing to such non-exchange markets is a more solid foundation for HOA's.

A good group to get involved in the effort is the current off season owners by giving them some incentive to encourage a frend to buy an off season week. Many of these people specifically like coming to the beach that time of year, so they will be enthusiastic with their friends. A good incentive to offer is a free stay in an availible unit during off season.

 

[AwayWeGo]

75 Orphans Out Of How Many Good-Standing Weeks ?

A resort must have a strategy for selling or giving away the blue/green weeks. We have about 75 blue/green weeks in inventory at Twin Rivers. Knowledge is the key to getting someone to want these weeks. I plan to market them to current owners for trading purposes. I still think last-minute opportunities are amazing.

Does the same thing go for those Florida "All Red" timeshares that (supposedly) are high-season year round but that in reality also have their own higher & lower demand times ?

It still seems highly problematic for an independent, non-developer HOA-BOD to get involved in selling timeshares. Yet it's obviously also a big problem for the HOA-BOD -- & therefore ditto for all the timeshare owners -- if there are too many orphan timeshare weeks.

That's why all those elected volunteer HOA-BOD members get the big bux, eh ?

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

 

[johnmfaeth]

One clarification and thanks to Carolinian for showing that I was not clear in my postings...

Collection activities must be ongoiing and begin immediately. State laws (and US Virgin Islands Territorial Law) govern the timetables which must occur before an action of foreclosure can commence. The model I describe stays in compliance which such timetables, gives a "last out" via deedback before foreclosure filing, and is continual so no backlog of deadbeats can build up resulting in a massive acquisition by the HOA.

The dangers of waiting and then doing it in "bulk" can be seen at the Pelican Resort in St. Maarten. After ignoring the delinquency situation for years, 1,200 RTU lease units were foreclosed in one shot about 2 years back. This sales "overhang" on the resale market collapsed prices for all and resales from the HOA were also slow as a result of the massive available unit volumes.

Again, I believe in prompt and timely action on a continuing basis.

The results at the Wyndham resort I was referring to on St. Thomas has created a delinquency rate less than half of the ARDA avarage, and resale values second only to the Ritz-Carleton, Westin St. John, and Marriott FC in the USVI, not bad for a "lowly" Wyndham. More importantly, the "constant communication" style of the board and active owners has created a feeling of owner inclusion and happiness I see nowhere else where I own.

So yes, 'Tough Love" can work very well.

We are blessed with no "dog weeks" although Sept. Oct. is a slow time for the Caribbean, folks still go and have a great time.

John

PS. Maintenance fees are also among the lowest in the USVI. For 2008, fees increased an average of 2% based upon unit types. There is also an ongoing replacement/refurbishment program in the units, a 40 foot container of new bedding and sofabeds arrived three weeks back for example. Cargo container shipping delays of 6 months+ killl us in the USVI.

In 2007, the pool and one tennis court was fully rebuilt and $10K+ of new exercise equipment obtained for the free fitness room. last year, all pool chairs and unbrellas were replaced, this year, all new patio furniture for all units. The ongoing beach erosion prevention program of the past two years has resulted in many new palm trees and sea grass protection for the sand behind the beach.

Yup, I think it's working just fine...

 

[JMAESD84]

One clarification and thanks to Carolinian for showing that I was not clear in my postings...

Collection activities must be ongoiing and begin immediately. State laws (and US Virgin Islands Territorial Law) govern the timetables which must occur before an action of foreclosure can commence. The model I describe stays in compliance which such timetables, gives a "last out" via deedback before foreclosure filing, and is continual so no backlog of deadbeats can build up resulting in a massive acquisition by the HOA.

The dangers of waiting and then doing it in "bulk" can be seen at the Pelican Resort in St. Maarten. After ignoring the delinquency situation for years, 1,200 RTU lease units were foreclosed in one shot about 2 years back. This sales "overhang" on the resale market collapsed prices for all and resales from the HOA were also slow as a result of the massive available unit volumes.

Again, I believe in prompt and timely action on a continuing basis.

The results at the Wyndham resort I was referring to on St. Thomas has created a delinquency rate less than half of the ARDA avarage, and resale values second only to the Ritz-Carleton, Westin St. John, and Marriott FC in the USVI, not bad for a "lowly" Wyndham. More importantly, the "constant communication" style of the board and active owners has created a feeling of owner inclusion and happiness I see nowhere else where I own.

So yes, 'Tough Love" can work very well.

We are blessed with no "dog weeks" although Sept. Oct. is a slow time for the Caribbean, folks still go and have a great time.

John

PS. Maintenance fees are also among the lowest in the USVI. For 2008, fees increased an average of 2% based upon unit types. There is also an ongoing replacement/refurbishment program in the units, a 40 foot container of new bedding and sofabeds arrived three weeks back for example. Cargo container shipping delays of 6 months+ killl us in the USVI.

In 2007, the pool and one tennis court was fully rebuilt and $10K+ of new exercise equipment obtained for the free fitness room. last year, all pool chairs and unbrellas were replaced, this year, all new patio furniture for all units. The ongoing beach erosion prevention program of the past two years has resulted in many new palm trees and sea grass protection for the sand behind the beach.

Yup, I think it's working just fine...

All right John....I ready to BUY

 

[johnmfaeth]

Hi James,

Sure, I have a great swing season dog week in the Poconos for ya

Sorry if I sounded too much like one of the TS Weasals. Like all resorts there is always an ongoing list of to do's to get the quality further along, but the trend is good.

And like every Caribbean resort, staff training is a constant battle, as is controlling energy, insurance, and labor expenses (unionized in the USVI).

So it is not Nirvana. Nor is it the Marriott FC or WSJ, you get what you pay for in life. But the system works, that is my main point.

John

 

[JLB]

The ostrich-head-in-the-sand approach to resales is one of the major blunders of the timeshare industry. Most of the industry still chooses to ignore it, and it still continues to be one of the major blunders for those who do.

One only needs to look at some of the older, developer-long-gone resorts that have their own resale programs, to see how the marketplace can determine real value.

 

[rickandcindy23]

Does the same thing go for those Florida "All Red" timeshares that (supposedly) are high-season year round but that in reality also have their own higher & lower demand times ?

It still seems highly problematic for an independent, non-developer HOA-BOD to get involved in selling timeshares. Yet it's obviously also a big problem for the HOA-BOD -- & therefore ditto for all the timeshare owners -- if there are too many orphan timeshare weeks.

That's why all those elected volunteer HOA-BOD members get the big bux, eh ?

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

The lie that all Orlando is red is enough to sell all of the Orlando weeks an HOA has in inventory, isn't it? I mean, if the salespeople are all touting Orlando being 100% red, there is no reason for people to doubt it.

I am one person that loves Orlando in the off-season. I love it when the temperatures are in the 60's for highs and I have to wear a sweater and jeans. I don't want to be there with the crowds and the long waits in line (or in the heat of summer). I want to walk right onto every single ride without waiting. I see Orlando becoming a much busier place when school is IN. The Boomers are retiring, the youngest boomers like us (we're 52) are seeing Orlando is the ideal spot for those cold winter days in Colorado, and I don't think we are the only ones. The parks used to be dead in September, but now the crowd levels are way up.

Some day, those pinkish-red weeks are going to be very red and Rick and I will have to find somewhere else for our no-crowd vacations.

Alan, we have 1350 total weeks, so 75 weeks is not all that bad. We have absorbed the cost so far, but I don't think we should continue to leave those weeks unused, when someone can get some use out of them.

 

[Wonka]

The only answer

I got it! We need a government bailout!

 

[bugzapper]

What are you proposing, that we all sell our weeks and go to Orlando with RCI's rental bargains?

The reason owners would want to keep their green weeks (we are with II) is that at least you don't have to settle for a hotel room in Orlando or Hawaii. There are some very nice trades out there, and I am not just talking about Orlando (you can get there in the summer with a green/blue week easily, which you cannot rent cheaply. This is the reason a person should never buy Orlando).

I would never propose that everyone sell all of their timeshares. (There would be nothing to rent cheaply!) I was, however, arguing that there are some weeks that don't really have any value. When the maintenance fees are greater than the amount the week could fetch as rent, or the total cost as an exchange is greater than the price of an equivalent rental, the timeshare really has no value.

In the case of Twin Rivers, the total cost to exchange, for someone new to II, is about $700. (Sure the amount would decrease slightly if you get a multi-year II membership or you exchange multiple weeks.) If you take into account closing costs (both to buy and sell) and the liability you assume by owning a week, I would say that if you can rent what you want for say $900 or less, you are probably better off renting. Skyauction has three pages of 2008 summer Orlando weeks for $900 in the buy-it-now section. As we approach the last minute rental time period, I predict those prices will decrease.

If I knew that exchanging a green week would get me something nicer than I could rent, and I could reliably predict that this trend will continue, and I were certain that I would be able to use the week year after year, and I knew that I could dump the week when I no longer wanted it, I would happily acquire a green week. I will probably own a timeshare someday--when I run out of nice timeshares that I can rent more cheaply!

 

[bugzapper]

What about Fred? At the time each of them committed to this arrangement, each must have considered it a good deal. Circumstances change and, in retrospect, this became a better arrangement for some and a terrible arrangement for others.

But where is the "patent unfairness" of this arrangement? I guess you lost me on this one. Ron might feel this is unfair but it is no more unfair than anyone agreeing to a financial condition that turns out badly. Isn't this what it's all about, at bottom!

Fred continued to use the car himself, driving to work.

The "patent unfairness" of this situation is that the people who are profiting from the old clunker of a car are the same ones who are in a position to prevent Ron from being released from his no-longer-desired interest in the car. It is a win-lose situation that Fred, George and Ginny are determined to keep. In all likelihood, if the persons who used the car were the only ones who contributed to its maintenance, they would decide it was no longer worth owning and dispose of it. If Fred, George and Ginny were decent people, they wouldn't continue to profit from Ron's misfortune knowing that he wants out.

How many of us would purchase a car in a similar arrangement? Not many. Yet similar inequities occur all the time with vacation property.

 

[johnmfaeth]

Fred continued to use the car himself, driving to work.

The "patent unfairness" of this situation is that the people who are profiting from the old clunker of a car are the same ones who are in a position to prevent Ron from being released from his no-longer-desired interest in the car. It is a win-lose situation that Fred, George and Ginny are determined to keep. In all likelihood, if the persons who used the car were the only ones who contributed to its maintenance, they would decide it was no longer worth owning and dispose of it. If Fred, George and Ginny were decent people, they wouldn't continue to profit from Ron's misfortune knowing that he wants out.

How many of us would purchase a car in a similar arrangement? Not many. Yet similar inequities occur all the time with vacation property.

If Fred was sharp in purchasing the car with others, he would have what amounts to a "tenants in common" ownership interest in the car. This means that Fred could go out and find another person to buy the car and use it during Fred's alotted hours. Luckily each TS owner is by default a Tenant in Common with all other owners and thus has control of his right to sell/give away his ownership interest.

Perhaps Fred would have to sweeten the deal for the buyer or his share, lets say kick in the first year's gas (aka maintenance fees).

But maybe Fred is mad at GM who sold the car and thinks it will hurt them by not paying his share to the other owners.

 

[chris5]

Fred continued to use the car himself, driving to work.

The "patent unfairness" of this situation is that the people who are profiting from the old clunker of a car are the same ones who are in a position to prevent Ron from being released from his no-longer-desired interest in the car. It is a win-lose situation that Fred, George and Ginny are determined to keep. In all likelihood, if the persons who used the car were the only ones who contributed to its maintenance, they would decide it was no longer worth owning and dispose of it. If Fred, George and Ginny were decent people, they wouldn't continue to profit from Ron's misfortune knowing that he wants out.

How many of us would purchase a car in a similar arrangement? Not many. Yet similar inequities occur all the time with vacation property.

We've all made bad deals in our lives; people are always profiting from the miscalculations of others; you ascribe a moral dimension to a business arrangement when, quite frankly,you haven't articulated a standard of morality for anyone to follow -- except to say that it is not decent for people to follow their own self-interest to the detriment of someone else's interest?

Ron is burdened with a bad deal -- but it's just that and nothing more.