Defaulting on Maintenance Fees

[bjones9942]

When one makes a commitment to another, via contract or promise, one has a moral, and legal obligation to uphold their end of the bargain. Religion has nothing to do with this issue, so please let's not bring prayer into this.

Defaulting does NOT release you from your commitment. Try telling the court that when your creditor sues you for your back maint fees. Bankruptcy CAN let you walk away. The difference is that you must present your financial situation to the court and THE COURT will decide the outcome.

Defaulting is never moral. Screwing other people because you are angry, upset, frightened, or any other rationalization is cowardly. At least have the huevos to stand up and say 'I didn't want it any more, so I stopped paying. I don't know you and don't care that you had to pick up my slack'.

When you cause harm (financial or otherwise) to others simply to improve your own situation, the words from my previous post apply to you. When you don't keep your word (contract) you are not trustworthy. Frankly, I don't see how anyone could think otherwise, no matter where they happen to reside.

And the definition of default (from dictionary.com) as it pertains to legal matters:
de·fault /dɪˈfɔlt/ [dih-fawlt] –noun
[...] 3. Law . failure to perform an act or obligation legally required, specially to appear in court or to plead at a time assigned.

Note that it is a FAILURE to follow the law, NOT a legal remedy.

 

[ronparise]

Now just a moment. Legality is one thing, morality another. When you agree to do something, by signing a legal document, you are making a promise. Do you really think a promise has no moral content? What if you promised to pay back your parents, or a very good friend. Would your agreement have no moral content? Would it be perfectly OK to stiff them? Does the morality hinge on whether there's a "personal" connection; i.e., a friend versus an anonymous corporation? Come on, stiffing somebody because you don't want to pay (as opposed to being unable to pay; which is another thing entirely) is scummy, and people who do it should at least admit that they're scumbags.

Thats a great argument and perhaps I am a scumbag, but it dosent change anything, If I feel its the best thing for me Ill admit my mistake Ill consider the consequences, Ill look for a different solution to my problem, but as a last resort Ill default and suffer the consequences. Including wearing the scarlet S (for scumbag) on my forehead.

We have already establashed that default is a legal remedy. Im not saying that the decision to default wont have an effect on others; it will. Is there a moral component there? probably, but my point is that it dosent matter. There will be defaults and an association should face that fact and do, what ever they can, to minimize the effect on ownership. Tight management of expenses, improvements to the resort (to improve the value of the blue weeks,) buy backs, resales, rentals etc etc

the defaulting owners may have caused the problem, but the association has to deal with it. The fact that they dont (in some cases) is I think indicative of poor management. which itself may be illegal and immoral

 

[OldPantry]

Here's the Bad Debt Expense for most of the North American & Caribbean Marriott timeshares:
...

Yes, this is very interesting information. For the great majority of Marriott resorts, the charge is minor, but for a few it's becoming a real issue ($71 per owner at Doral, for example). In time, I do worry that it might become a truly major issue. One part of it, I'm sure, is mud weeks. A Myrtle Beach January owner probably feels pretty unmotivated, when he/she is expected to pay the same MF as a platinum owner. Of course, that's what they agreed to do, but eventually it might become necessary to address their concerns more directly. Just saying.

 

[Ridewithme38]

What are the smaller Resorts 100 rooms? 52 owners per room...the highest MF mentioned was $2500...that 5200 owners...if one owner defaults the cost to the rest is .48cents....theres hardly a moral decision to make between a family losing out on $2500 or making someone else lose out on .48cents...i lose more then that in my car seat on the drive home from work most days...

Yes, there is always more then one person that defaults every year...But thats not what we are talking about here, are we? are we discussing ways to keep large amounts of members from defaulting, or are we talking about it being right or wrong if ONE person defaults?

If you guys are really that upset about .48cents...i don't know if TSing is for you...If its about LARGE GROUPS of people defaulting...well you should talk to your HOA and have them change some things around the resort so the value is there

 

[OldPantry]

Thats a great argument and perhaps I am a scumbag, but it dosent change anything, If I feel its the best thing for me Ill admit my mistake Ill consider the consequences, Ill look for a different solution to my problem, but as a last resort Ill default and suffer the consequences. Including wearing the scarlet S (for scumbag) on my forehead.

I seriously doubt you have the courage to wear that scarlet S. You'll just do it, and hope nobody notices. Will you tell your kids?

 

[ronparise]

Now just a moment. Legality is one thing, morality another. When you agree to do something, by signing a legal document, you are making a promise. Do you really think a promise has no moral content? What if you promised to pay back your parents, or a very good friend. Would your agreement have no moral content? Would it be perfectly OK to stiff them? Does the morality hinge on whether there's a "personal" connection; i.e., a friend versus an anonymous corporation? Come on, stiffing somebody because you don't want to pay (as opposed to being unable to pay; which is another thing entirely) is scummy, and people who do it should at least admit that they're scumbags.

Thats a great argument and perhaps I am a scumbag, but it dosent change anything, If I feel its the best thing for me Ill admit my mistake Ill consider the consequences, Ill look for a different solution to my problem, but as a last resort Ill default and suffer the consequences. Including wearing the scarlet S (for scumbag) on my forehead.

We have already establashed that default is a legal remedy. Im not saying that the decision to default wont have an effect on others; it will. Is there a moral component there? probably, but my point is that it dosent matter. There will be defaults and an assuciation should face that fact and do, what ever they can, to minimize the effect on ownership. Tight management of expenses, improvements to the resort (to improve the value of the blue weeks,) buy backs, resales, rentals etc etc

the defaulting owners may have caused the problem, but the association has to deal with it. The fact that they dont (in some cases) is I think indicative of poor management. which itself may be illegal and immoral

 

[bjones9942]

We have already establashed that default is a legal remedy.

Repeating this over and over will not make it true. Again, default is a failure to follow the law, not a legal remedy.

 

[bjones9942]

I seriously doubt you have the courage to wear that scarlet S. You'll just do it, and hope nobody notices. Will you tell your kids?

I'd do it and say I've changed my name to Steve.

 

[OldPantry]

What are the smaller Resorts 100 rooms? 52 owners per room...the highest MF mentioned was $2500...that 5200 owners...if one owner defaults the cost to the rest is .48cents....theres hardly a moral decision to make between a family losing out on $2500 or making someone else lose out on .48cents...i lose more then that in my car seat on the drive home from work most days...

Yes, there is always more then one person that defaults every year...But thats not what we are talking about here, are we? are we discussing ways to keep large amounts of members from defaulting, or are we talking about it being right or wrong if ONE person defaults?

If you guys are really that upset about .48cents...i don't know if TSing is for you...If its about LARGE GROUPS of people defaulting...well you should talk to your HOA and have them change some things around the resort so the value is there

So, because the collective impact of a given default is small, it's OK to absolve the defaulter? How about pickpocketing a New Yorker? (It's such a big city, the average citizen is hardly affected ...). When droves of people default on MFs, won't they all say exactly the same thing?

 

[Ridewithme38]

So, because the collective impact of a given default is small, it's OK to absolve the defaulter? How about pickpocketing a New Yorker? (It's such a big city, the average citizen is hardly affected ...). When droves of people default on MFs, won't they all say exactly the same thing?

pickpocketing has a much greater impact then .48cents...The point is one or two people defaulting on their MF's is really no big deal...But when droves of people do it, it starts to have a large effect and you have to wonder WHY they are doing it and correcting the problem....With what we are seeing MF's going up sometimes hundreds of dollars because of defaults theres an inherit problem with the system...

Its THAT problem that needs to be fixed, not the one of two odds balls but the object that is causing HUNDREDS of people to default

 

[larryallen]

WOW! That's the nicest thing I can say. Several of you have serious low moral thresholds in MY opinion. At least the one guy understands he is a scumbag. The 48 cents argument is silly. First, as demonstrated above by Denise it can ADD UP to $250 in her Westin example, and second, the dollar amount doesn't matter. Is it ok to steal a 48 cent item from a store? I mean it's just 48 cents, right?

 

[Ridewithme38]

WOW! That's the nicest thing I can say. Several of you have serious low moral thresholds in MY opinion. At least the one guy understands he is a scumbag. The 48 cents argument is silly. First, as demonstrated above by Denise it can ADD UP to $250 in her Westin example, and second, the dollar amount doesn't matter. Is it ok to steal a 48 cent item from a store? I mean it's just 48 cents, right?

IF we are talking moral's....its been discussed that it is ok for a starving person to steal a loaf of bread to feed himself if need be....sure its illegal, but morally its been judged to be ok

 

[AwayWeGo]

You Typed A Mouthful.

the defaulting owners may have caused the problem, but the association has to deal with it. The fact that they dont (in some cases) is I think indicative of poor management.

You are correct, sir.

That's why the No. 1 job of timeshare HOA-BODs is collections. That means prompt, aggressive action against deadbeats -- polite reminders just as soon as they're in arrears, locking'm out of their units till their accounts are up to date, bill collectors, lawyers, & court action up to & including foreclosure. (Some states reportedly now allow for non-judicial timeshare foreclosures in serious delinquency cases, saving time & expense for the HOA.)

Of course, ownership & billing records must be accurate & up to date -- an ongoing necessity that's worth what it costs management to maintain.

Slop in the collections system is a major serious disservice to all the conscientious, responsible timeshare owners out there who reliably pay on time every time.

I am hard core about this -- just something to keep in mind if you ever have the opportunity to vote for me or against me as a timeshare HOA-BOD candidate.

Full Disclosure: The 1 & only time I was a (self-nominated) candidate for a timeshare HOA-BOD, I got whupped bigtime in the voting & proxy counting. I no longer own at that timeshare, so now I am no longer even a potential candidate. (I didn't sell out over pique at losing the election. We just no longer were using our week as we thought we would when we bought it, so we gave it away el freebo to fellow TUG members.)

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

 

[Ridewithme38]

Maybe i don't understand what everyone is upset about

Are you guys this upset about possibly .48cents more on your bill because of one or two people defaulting...then i understand this thread being directed at the owners who are doing that

OR

Are you guys upset about LARGE NUMBERS of people defaulting from the resorts every year? Because the only way to fix that is fix the problems within the resort...its obviously not a person by person thing if there are so many people doing it...Talk to your HOA/BOD's make sure they ASK WHY people are defaulting and ask if there is ANYTHING they can do to help...see if there is anything that can be changed, upgraded, added that will increase the value enough so that they will stay

If you owned a store and you lost one customer, its that customer who left...but if suddenly hundreds stop coming in...you have to realize that its not the customers anymore, its something wrong with your store...One or two people, i understand you guys being upset at the owners that flake out...but when its an epidemic like this, you HAVE to look at the source!!

Meh, maybe my ultra liberal side is coming out a bit too much with this post

 

[MALC9990]

IF we are talking moral's....its been discussed that it is ok for a starving person to steal a loaf of bread to feed himself if need be....sure its illegal, but morally its been judged to be ok

I think on balance I am glad that all my weeks are at MVCI resorts which are RTU. So, should it get to a point where I am unable to pay my MFs then after two years of failing to pay, my Right to Use is forfeited and the ownership reverts to MVCI and they pay the back MFs and can resell the week.

I don't plan for or expect this to happen as the MFs are part of my annual budget and as a one time now retired project manager, planning and managing a budget is second nature and my MFs form an important element in the budget.

So in my mind MVCI resorts sold on a RTU basis rather than on a deeded property ownership basis have an inbuilt defence against non-payment of MFs since the responsibility reverts back to MVCI when the weeks are lost and returned to MVCI to resell.

 

[e.bram]

I would wear the scumbag as a badge of honor. Along with G Washington and T Jefferson(for refusing to pat the tea tax)
An agreement is a two way street, when one side(management) breeches then I on the other side have a right with no compunctions to breech(bail) as well.

 

[SueDonJ]

When one makes a commitment to another, via contract or promise, one has a moral, and legal obligation to uphold their end of the bargain. Religion has nothing to do with this issue, so please let's not bring prayer into this. ...

IMO there's a huge distinction between a promise and a contractual obligation. A promise (such as the golf game wager mentioned by another poster) requires a moral imperative while a legal contract (such as a timeshare Contract for Purchase and the related governing documents) does not.

And the definition of default (from dictionary.com) as it pertains to legal matters:
de·fault /dɪˈfɔlt/ [dih-fawlt] –noun
[...] 3. Law . failure to perform an act or obligation legally required, specially to appear in court or to plead at a time assigned.

Note that it is a FAILURE to follow the law, NOT a legal remedy.

Repeating this over and over will not make it true. Again, default is a failure to follow the law, not a legal remedy.

From freedictionary.com, the first two definitions of default are:
1. Failure to perform a task or fulfill an obligation, especially failure to meet a financial obligation: in default on a loan.
2. Law Failure to make a required court appearance.

It's an important distinction that the second is specific to legal parlance (evidenced by the use of italics) while the first is not. Because the dictionary specified one and not the other to the law specifically, it can't be said that defaulting on a loan is always a legal issue. What makes it a legal issue with respect to a timeshare contract (and most every other purchase contract) is that the contract will most likely stipulate consequences should an owner be in default. Think about it - if the contract doesn't contain such a stipulation, there is no remedy at all for the management company or the other owners to take any actions if defaults occur. Financial default is meaningless by itself, without the related contract stipulations.

Aside from the legal v. moral argument related to any timeshare issue (which I will never understand because the only remedies for any negative owner or management or developer actions are contractual/legal,) my personal feeling is that I hope owners who can no longer take on the financial obligations of a timeshare do their research and take every action possible to walk away without putting the burden on the other owners. Not because I think it's the moral thing to do, though - but because I don't want to pay anyone else's share! But the fact is, the contracts require us to assume those burdens whether the defaulted owners had no choice because of legitimate desperate financial straits, or whether they just walked away because they could.

****
Interesting to note - not all defaulted fees in the Operating Budgets are MF, some are mortgage loans for developer sales. I'd guess those are the ones that cause the most damages.

 

[bjones9942]

I would wear the scumbag as a badge of honor. Along with G Washington and T Jefferson(for refusing to pat the tea tax)
An agreement is a two way street, when one side(management) breeches then I on the other side have a right with no compunctions to breech(bail) as well.

I am in partial agreement. If you've been holding up your end of the contract by paying your maintenance fees and the resort failed to honor their contractual obligations then you would have every right to sue them to force them to perform. If they still would or could not perform then you would have a good case for having the courts dissolve your contract.

I don't quite see your connection of the tea tax to defaulting on your contract. Are you saying that the resort changed the terms (i.e. billing you for something not originally specified or allowed for) of your contract without your approval? In that case, there is no longer a meeting of the minds, and a court would likely nullify your contract, or force them to perform under the original agreement. Otherwise, if the management company is performing under the terms of the contract and you just don't like it, well - you only have yourself to blame for entering into the agreement.

In any event, your legal remedy is with the court system - not by defaulting on your contract and burdening the other owners at your resort.

 

[ronparise]

****
Interesting to note - not all defaulted fees in the Operating Budgets are MF, some are mortgage loans for developer sales. I'd guess those are the ones that cause the most damages.

I doubt that thats the case. A buyer dosent usually borrow from their HOA to make the purchase

Its mf we are talking about and special assessments

 

[bjones9942]

what makes it a legal issue with respect to a timeshare contract (and most every other purchase contract) is that the contract will most likely stipulate consequences should an owner be in default. Think about it - if the contract doesn't contain such a stipulation, there is no remedy at all for the management company or the other owners to take any actions if defaults occur. Financial default is meaningless by itself, without the related contract stipulations.

I disagree. A contract is a meeting of the minds between two or more parties. This can be evidenced in several ways, including both written and verbal (incl. promises) contracts. When one party fails to perform under the contract/promise, then they are in default and the other party (parties) has/have every right to pursue their performance via the courts. Promises may be harder to litigate, but if the injured party/parties [plaintiff(s)] can show damages resulting from reliance on the promise then they are likely to either win compensation or forced performance from the defendant(s).

There is ALWAYS an implied consequence of default in a contract - that the courts will force you to perform if/when the other party/parties take action against you. Not stipulating consequences in a contract in no way removes the right to sue over non-performance. That's just plain silly.

 

[AwayWeGo]

You Have An Excellent Case. Now, How Much Justice Can You Afford ?

In any event, your legal remedy is with the court system - not by defaulting on your contract and burdening the other owners at your resort.

Trouble is, some slick & semi-shady timeshare companies out there just dare you to go to court, knowing full well they can easily out lawyer-whip you. Plus, they know that the attorney fees & court costs you're apt to rack up by pursuing your own legal remedy will cost you more than the value of the legal remedy at issue.

How do the slick-shady timeshare companies do that ?

Some of'm by asserting a Right Of 1st Refusal ("ROFR") upon resale that they flat-out don't have, realizing most folks won't know the difference or will be unable to find out, or both.

Some by sneakily doing el switcho when you try banking your high-value, high-demand prime-season fixed week with a timeshare exchange company. Only later do you discover that the timeshare company kept your el primo week for itself & instead banked an el crappo week in your name.

They know they're playing fast & loose. They also know that the scammed & hornswoggled owners will lie back & take it because the cost of court action will greatly exceed the worth of the bamboozle.

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

 

[ronparise]

Ok

let me come at this from a different direction

Im trying to say that the morals and the legality of a default dont matter to the rest of the owners (and probably not to the defaulter). My lack of morals or my illegal act may upset you and you may be able to send me to jail or to hell, but that dosent solve the problem. You, the association, has a non paying interval to account for

What matters is this association problem and they have to deal with it. They can take action and make changes at the resort to lessen the likelyhood of defaults and they can take action to deal with the defaults when they do happen. But they have to do something. To do nothing is, I think, bad management of the resort and perhaps illegal or immoral itself

 

[OldPantry]

I would wear the scumbag as a badge of honor. Along with G Washington and T Jefferson(for refusing to pat the tea tax)
An agreement is a two way street, when one side(management) breeches then I on the other side have a right with no compunctions to breech(bail) as well.

So now you turn it into a virtue, worthy of our founding fathers? Some chutzpah! They were risking something real, for a real principle, and you're talking about reneging on a contract that you willingly signed. Scumbag might be your particular badge of honor, but it's not theirs.

 

[bjones9942]

Trouble is, some slick & semi-shady timeshare companies out there just dare you to go to court, knowing full well they can easily out lawyer-whip you. Plus, they know that the attorney fees & court costs you're apt to rack up by pursuing your own legal remedy will cost you more than the value of the legal remedy at issue.

The small claims filing fee in Washington varies between $14 and $29. Then there's the fee for service, if applicable. I think most people would find this affordable. And I'd enjoy the fun of having some attorney try to lawyer-whip me

 

[bjones9942]

...My lack of morals or my illegal act may upset you and you may be able to send me [...] to hell...

Save me a table, order me a drink and we can discuss the various ways we've arrived!

...What matters is this association problem and they have to deal with it. They can take action and make changes at the resort to lessen the likelyhood of defaults and they can take action to deal with the defaults when they do happen. But they have to do something. To do nothing is, I think, bad management of the resort and perhaps illegal or immoral itself

You have actions available to you, other than default, for situations like this. First, approach the HOA with your concerns. If that doesn't work, get yourself elected to the HOA and try initiate change. If that doesn't work, take them to court. If that doesn't work, put your TS up for sale, and continue to use it, while wearing naught but a speedo, until it sells. In my case, the HOA would probably rush to buy my TS!

[I've just looked up the legal definition of 'default' in my copy of 'Oran's Dictionary the LAW'. It states: 1. A failure to perform a legal duty, observe a promise, or fulfill an obligation. For example, the word is often used for the failure to make a payment on a debt once it is due. 2. Failure to take a required step in a lawsuit; for example, to file a paper on time. Such default can sometimes lead to a default judgment against the side failing to file the paper.]