Ebay seller didn't pay MF as promised.

[rickandcindy23]

This is why I choose, where possible, to tell the seller I will pay the MF for the current year. Then it's my problem to deal with it, and to try to negotiate with SVO on late fees.

I lost my negotiations on late fees. I had two recently close with fees and late fees due. The guy would not cut me any slack. One unit was $50 in late fees, along with the current payments. I really resent these sellers who do not get weeks closed in a timely manner.

Memorable Vacations on ebay has one such week I bought that finally is recorded, but he wants MF's, and he isn't getting the money from me. I have no intention of sending him another dime. I will pay Starwood directly, and I already talked to Starwood today about it.

Jarta, don't bother to comment, telling me everything I have done wrong with my resale purchases, as I have you on ignore.

 

[Robert D]

I still don't get it. What should I do exactly next time to prevent such problems? I know better buy it off from a broker, but finding a good broker with the right timeshare is too much work for me, at least for now. So given that ebay is risky, is there anyway to reduce the risk?

I'd call Resort Closings and ask them if they will pay the delinquent maintenance fee. If they waffle at all, I'd send a letter to the attorney general, the real estate commission, and also the insurance commissioner (or whoever regulates title companies) in the state where the TS is located and also in the state where this closing company is located notifying them that this closing company did not do their job and veryify the maintenance fee was current before disbursing funds to the seller, and copy the closing company and seller on this letter. If these guys have any sense, they will take care of this problem quickly when they get copies of these letters.

 

[jarta]

sui, ... "I still don't get it. What should I do exactly next time to prevent such problems?"

Your problem last time was that you did not secure the payment of the MF by forcing the payment to be made through the escrow and with proper instructions.

Not every eBay purchase has "such problems." Probably the majority of eBay purchases have no problems at all. And, if a problem pops up for a next purchase, there is no guarantee that it will be the same problem.

Buying on eBay is like "do it yourself" plumbing. It looks easy and it's much cheaper than hiring someone. Great bargains are available for distressed properties on eBay. But, taking title to property is much more complicated than it looks. You'd better know what you are getting yourself into. And, when something goes wrong while you are working on the "plumbing"?????????????? Most of the time you will get sympathy on TUG and suggestions to try, but the advice is like closing the barn door after the horse has run away. If the seller wants to do you a favor, he can. But, legally, in most cases he doesn't have to by the time you ask.

Buying a timeshare is a real estate transaction. If it was a house would you buy it on eBay and close it without finding out who you are dealing with and without an escrow? If not, is the much smaller amount of money at risk what induced you into using eBay? So, maybe you took a small risk and it didn't work out so well.

Short of telling you to learn about the details of a real estate transaction, how title passes and the roles and responsibilities of the various participants (which wouldn't really be much help and could be interpreted as being flippant), I'm not sure what to tell you in one post which would cover all "such problems."

I guess you put your money on black when you play on eBay and you hope for the best. Most of the time it will go well, but I caution against it - unless you know what you are doing and can deal with and ensure against problems that arise.

GLTY! I hope the seller gives you the satisfaction you deserve. ... eom

 

[tombo]

I still don't get it. What should I do exactly next time to prevent such problems? I know better buy it off from a broker, but finding a good broker with the right timeshare is too much work for me, at least for now. So given that ebay is risky, is there anyway to reduce the risk?

One bright note on your problem buy, if it is like most e-bay timeshare purchases you will still own your week much cheaper counting e-bay purchase price, closing costs, and also counting the MF's you weren't supposed to pay than you could have purchased it from a broker. Not saying I wouldn't be mad if I was you because I absolutelly would. I would be burning up the phone lines to the seller and threatening them with legal action hoping to make them do what they were supposed to do in the first place. If none of that works and you end up having to WRONGLY pay the MF's, when you total up everything you payed (including the MF's) you should still be way ahead of a broker purchase, and wayyy wayyy ahead of a developer purchase.

Here is s strategy I have never used that might work. E-bay timeshare sales are not binding. You can leave them poor feedback but from what I understand they can not do the same to you if you don't complete the sale. Buy another week, any week from them on e-bay. Never pay them but click on items won and hit paid (E-bay assumes you [aid other than Paypal), then immediatelly leave negative feedback on the new sale explaining that you purchased a week from this seller that they were supposed to pay the MF's on which they never did. Then contact them and tell them that you will remove the negative feedback as soon as they pay the MF's as they were supposed to do. Not sure it will work, but it can't hurt.

 

[jarta]

tombo, ... The "seller" on eBay is not the seller of the property. "Seller" on eBay only means the person who placed the ad with eBay. Seller in real estate parlance is the person who holds good title to the property and can dispose of it.

eBay auction results for the purchase of an interest in property are not binding contracts. That's due to the various Statutes of Frauds which have required (since the Middle Ages) that all contracts for the purchse of an interest in real estate be in writing. It's far too easy for a potential buyer to make a false claim that someone made an oral promise to sell the real estate for a low price and use the threat of a suit to extort money.

In this case, the OP executed a contract after the bidding ended. The contract did not provide for escrow instructions to the closing agent (who also is not the seller) that required the closing agent to pay the delinquent MF from the closing proceeds. The OP just believed that they would be paid outside the closing. Oral promises made outside of the contract usually cannot be enforced since the deed usually says it contains all the terms of the contract and that they cannot be altered orally.

So, the OP (unknowingly) played Russian Roulette in this transaction and this time drew a full chamber.

But, you are right. Even with the payment of the delinquent MF, the money expended is a lot less than buying directly from the developer. But, what about the value of the OP's time spent (not to mention yours and mine) and the anguish caused to the OP when the "gun went off."

I know the problems that can occur on even the simplest of real estate transactions, cannot recommend playing timeshare Russian Roulette on eBay and don't understand the advice given by those who routinely advocate taking the risk without saying the only justification for playing at all is that the risk is small in monetary terms and do not add that many times the same price can be found outside of eBay (see posts 13, 17 and 18 in this thread). Just my opinion. ... eom

 

[tombo]

tombo,
In this case, the OP executed a contract after the bidding ended. .

I didn't realize that. I thought that they were the winning bidder and the seller did not do what they said they would do in the auction description.

In this case trying to beat the system and buying outside of e-bay's auction was not a savings. It was as you said a gamble, and one they lost. But even counting the MF's they probably still own cheaper than they would have if purchased from a broker, and possibly even cheaper than if they had purchased on an E-bay auction. I hope the gamble was worth it for the OP.

Whenever you contact the seller and offer to buy outside of an e-bay auction, even MORE due dilligence must be done to protect yourself. I have done it on more than one occassion, but I double check everything and still sweat it until everything is done.

E-bay has some built in protections and feedback options that help protect the buyer. When you purchase outside of e-bay you are totally on your own.

 

[jarta]

tombo, ... "When you purchase outside of e-bay you are totally on your own."

Yes, but any risk is risk you assume. You are totally on your own only if you won't pay for assistance from a competent, professional, bonded and licensed broker and/or closing firm.

My reference about a contract after the auction is this statement in the OP: "the seller promised to pay for 2011 MF, and it is cleared stated in the purchase contract as well." Unfulfilled provisions of the contract merge into the deed and do not survive the closing. Another reason why the closing agent should have been given specific instructions concerning the seller's deposit of the MF into the escrow and the closing agent's payment of the MF from the escrow. ... eom

 

[Ken555]

I know the problems that can occur on even the simplest of real estate transactions, cannot recommend playing timeshare Russian Roulette on eBay and don't understand the advice given by those who routinely advocate taking the risk without saying the only justification for playing at all is that the risk is small in monetary terms and do not add that many times the same price can be found outside of eBay (see posts 13, 17 and 18 in this thread). Just my opinion. ... eom

Not all of us feel the need to fully explain our opinion each time we post about a topic. In this instance, I don't believe it's necessary for me to always stipulate all the inherent pitfalls of a certain action, in this case the purchase of a timeshare on eBay, while writing positively about my past experiences doing so. Every buyer must research and decide for themselves which avenue(s) to pursue when making a timeshare purchase. Your clarifications are often appropriate and helpful for new timeshare prospects. That said, I don't think the rest of us need to always include a full description of the positives and negatives of the risk inherent in an eBay transaction. After all, that's why you're here!

 

[Fredm]

This is not complicated or esoteric.

Professional practice dictates that fees ALWAYS be paid through escrow.

If m/f's and late fees are due, escrow should bill the seller for the fees owed, and deduct same from transaction proceeds before disbursing funds to the seller.

If there are insufficient funds in the escrow account to cover the sellers obligations (including m/f's and late fees), escrow should require the seller to deposit the necessary funds to the escrow account in order to close. Period.

Same with an outstanding loan against the property.
If the seller is upside down, they must deposit the required amount to clear the loan. M/f's and late fees are no different.

Most of the problems we discuss here are the result of an ebay purchase from a PCC with an incestuous "closing company". Most are set up this way.

Those that recommend a PCC seller simply because they have had a successful transaction (or several) do a disservice to the knowledge base here on TUG, IMO.
Bad closing practices are bad. They are not somehow made good because a buyer did not have a problem with the outcome.

There are right ways to do things. Professional practices are what they are to protect the parties from the exceptions.
And that is what we should be saying here on TUG, if we are to further the discussion.

If a tugger does not know what these practices and procedures are, they are well served by seeking the services of a professional. That would be good advice, IMO.

I could not believe my eyes when reading the following by the OP:

"I still don't get it. What should I do exactly next time to prevent such problems? I know better buy it off from a broker, but finding a good broker with the right timeshare is too much work for me, at least for now. So given that ebay is risky, is there anyway to reduce the risk?"

We tuggers rightly advise newbies to buy resale, and save thousands. Now, some here are encouraging newbies who have no idea what they are doing to save money by buying on ebay instead of working with a professional? And calling it a smart move!!

The wheels are flying off the wagon.

 

[sui]

Wait, I was the winning bidder, it is in the listing AND in the signed contract that the seller pays for the MF, I didn't know I need to do additional work to specify the money needs to be paid inside closing, I didn't even know there was alternatives. This is my first timeshare purchase, but from my past experience of traditional real estate purchases, you don't need to have an addendum for the funds to be applied through escrow, that is REQUIRED, you have a contract in escrow, the closing company follows the contract and distributes the funds accordingly, that's it, that's why I'm totally confused.

Well, now I finished all the posts, so basically what you get is what you paid for, buying on ebay is cheaper, but as a trade off, you shouldn't expect to get the professional services, i.e., more works/researches and probably paid lessons are necessary.

 

[Fredm]

Wait, I was the winning bidder, it is in the listing AND in the signed contract that the seller pays for the MF, I didn't know I need to do additional work to specify the money needs to be paid inside closing, I didn't even know there was alternatives. This is my first timeshare purchase, but from my past experience of traditional real estate purchases, you don't need to have an addendum for the funds to be applied within escrow, that is REQUIRED, you have a contract in escrow, the closing company follows the contract and distributes the funds accordingly, that's it, that's why I'm totally confused.

You are dealing with a closing company that is not an arms length entity from the auctioneer.
They did not protect you interests by paying m/fs to Starwood from transaction proceeds, and/or requiring the seller to deposit sufficient funds to accomplish same.

Now you own a timeshare that cannot be used until m/fs and late fees are paid to Starwood.
Go chase the seller/closing company.

 

[jarta]

sui, ... In traditional real estate transactions handled by a competent title company (like CT&T) one of the many forms you sign at the closing is the standard real estate escrow instructions that has the CT&T logo at the top. The title company prepares those standard instructions because it is insuring you have good title to the property when the deed is recorded.

I sincerely doubt you had any escrow instuctions drafted or executed for your timeshare purchase. You admit that you relied on the seller to pay them. Then, what in the world did the closing company do wrong?

The answer is the closing company does exactly what the escrow instructions provide. And, if they don't provide for a contingency, the closing company doesn't have to do anything. It was the seller's responsibility to pay the MF, not the closing company.

The seller didn't pay and you acquired good title to the week (along with all responsibility for paying the MF).

Fredm says "You are dealing with a closing company that is not an arms length entity from the auctioneer." That may be true. However, facially, there are different entities and, if you ever had to sue, you would have to prove there is a sufficient overlap so that the auctioneer and the closing company are, in reality, the same entity. That's not easy at all.

The scamsters on eBay (and even the incompetent and competent non-scamsters) go to great lengths to have separate entities (seller, auctioneer and closing company) for separate responsibilities precisely so that an unhappy purchaser can be whip-sawed around and directed from place to place until they give up and go away.

That's why eBay's Russian Roulette and using a bonded and licensed broker and a separate bonded and licensed competent closer gives you more protection. "Bonded" means that money or security for money has been deposited to cover errors and "licensed" means the State granting the license has certified the entity is honest - and if they aren't will yank the license.

Next time, don't be penny-wise and pound-foolish unless you want to assume the risk that something will go wrong.

BTW, I have purchased 3 weeks of timeshares on eBay, another 3 weeks from brokers and another 3 weeks from Starwood. I bought on eBay because I am an attorney that deals with aspects of real estate (not transactions), know what I am doing and the prices were very, very low. I do not take risks with my money or time. But, it is apparent that you do. Maybe next time you won't. ... eom

 

[teepeeca]

Sui

I didn't read all of the posts, BUT, from what I did read, YOU did nothing wrong !!! It was the closing company that mishandled the transaction.

They had the purchase contract, which stated ALL of the terms, which included that the seller would pay the mx fees. THAT escrow company had the duty to make sure funds distributed according to the contract, which included that the mx fees were paid by the seller to the resort, and if the seller DID NOT pay those fees, funds should have been withheld from the escrow account, and if not enough money in that account, then escrow should NOT have closed, until those fees were paid by the seller.

It is up to the closing company to "make things right".

Tony

 

[jarta]

Tony, ... "funds should have been withheld from the escrow account, and if not enough money in that account, then escrow should NOT have closed"

I think you have a wrong assumption. The purchase price was so small that it did not cover the delinquent MF. It could not have been paid from the buyer's deposit and deducted from what the seller received from the proceeds.

Nothing in the contract said the MF would be paid from the escrow. So, exactly where does the authority to hold up the closing come from? Would you, as closer, hold up the closing if your husband's company was the seller's agent and acting under a POA? lol!

Not to say that I know this happened in this case. But, on eBay you never know what the relationship is between the seller's agent/advertiser and the closing company. And, many times for eBay closings, they don't want you to know the extent of the relationship and won't let you pick another closing company because of a kickback from the closing company to the seller's agent (or the swiching of the money from one pocket to the other in the same pants).

But, as long as the price is low, I guess the risk is assumable. However, why come on TUG and belly-ache about it if you get fleeced on eBay? The price is still less than buying from the developer. ... eom

 

[sui]

Just an update, got an email form the closing company, they paid the MF for me. Thanks to everyone that helped.

 

[eal]

That's good news! In a sea of disreputable sellers and closing companies, the two that you were working with were a pretty good bet to make it right.

 

[jarta]

sui, ... Congratulations! Glad it worked out for you. ... eom

 

[Ken555]

Just an update, got an email form the closing company, they paid the MF for me. Thanks to everyone that helped.

Excellent! Enjoy your new week!