Giving back timeshare without maintenance fee

[LeslieDet]

Hi. We're trying to exit our TMVC (Marriott Vacation Club). We bought Vistana a while back before they were acq by Marriott. The loan's paid off, and we now are dealing with some outstanding maintenance fees. Any advice on how to negotiate down the outstanding $? Ideally would like to pay nothing but would take any advice for any tactics to lower it. Thanks.

Basically, you need to bring the maintenance fees current in order to be able to sell or give back to the developer. You can't negotiate the MFs owed down in order to then give away or sell. You can also chat with a bankruptcy lawyer to see if filing bankruptcy would help in your goal of avoiding paying the debt.

 

[andre10056]

The difference is that a third party lender is truly out that money. The developer who takes it back at foreclosure auction at a $0 valuation then resells it for $30,000 isn't really out any money. In the end, they were still made whole. In the end, it doesn't really matter since there is no actual evidence of any deficiency judgments being filed on timeshare foreclosures. Hawaii has a lot of timeshares but also permits for deficiency judgements.

And I guess your third assumption is that deficiency judgments do not occur because you've never seen or heard of one.

 

[dioxide45]

You do realize that you're making two "wishful thinking" assumptions, don't you?

1) that the developer successfully re-sells for $30,000

2) that "the law" sets out that deficiency judgments cannot be entered until we see what ultimately occurs to the underlying asset, even if years later and even after significant renovations and improvements to the property and/or resort

As to Hawaii, I don't really know what you're saying there but I'll reprint the Hawaii entry from Grammarhero's chart:

HI, developer has right to deficiency MF judgment for both judicial foreclosures or non-judicial power of sale (514-E29).

We know the timeshare developers resell these things for full retail. That is what timeshare companies do. This thread is specifically about a Vistana timeshare. When a week is foreclosed upon, they put into one of their trusts and resold for $x per point.

As for Hawaii, I am perhaps thinking you can find some deficiency judgements there since they allow for deficiency judgements and you seem to think developers are out to get deficiency judgements.

 

[dioxide45]

And I guess your third assumption is that deficiency judgments do not occur because you've never seen or heard of one.

Well, while not the best measure, you would think we would have heard of some reports on TUG about deficiency judgements regarding a timeshare foreclosure. I haven't seen any. Have you? Can you point to one anywhere? Thus you are assuming they are happening without actually ever seeing one.

 

[andre10056]

We know the timeshare developers resell these things for full retail. That is what timeshare companies do. This thread is specifically about a Vistana timeshare. When a week is foreclosed upon, they put into one of their trusts and resold for $x per point.

As for Hawaii, I am perhaps thinking you can find some deficiency judgements there since they allow for deficiency judgements and you seem to think developers are out to get deficiency judgements.

Exactly. We WERE talking about a specific Florida timeshare before your wanting to establish that Florida's favorable consumer protection law made no difference. That NO timeshare HOA and/or developer anywhere in the country ever got a deficiency judgment against a timeshare owner (at least, I think that's what you were trying to argue).

And I don't think that's true. And Grammarhero certainly did not think that was true.

 

[andre10056]

Well, while not the best measure, you would think we would have heard of some reports on TUG about deficiency judgements regarding a timeshare foreclosure. I haven't seen any. Have you? Can you point to one anywhere? Thus you are assuming they are happening without actually ever seeing one.

You already asked that question and my response was "no" as I have never worked for a timeshare HOA or developer. Ask them if such people (who are NOT working for California, Florida, or South Carolina timeshares) are on TUG.

 

[dioxide45]

Exactly. We WERE talking about a specific Florida timeshare before your wanting to establish that Florida's favorable consumer protection law made no difference. That NO timeshare HOA and/or developer anywhere in the country ever got a deficiency judgment against a timeshare owner (at least, I think that's what you were trying to argue).

And I don't think that's true. And Grammarhero certainly did not think that was true.

Do timeshare developers usually lobby for consumer protection laws like they did for this one in Florida?

 

[TUGBrian]

anyone in this country can sue anyone else for anything they like.

however there is no financial sense for a timeshare/developer/association to seek "x years worth of unpaid fees" in court because it would cost that amount or more to take that process all the way to a judge and even if you win you now begin the process to attempt to recover funds from a defendant whos likely in a different state. obtaining a judgement is only the beginning and even navigating that path is more trouble than its worth in almost all these situations.

add on top of that the optics of timeshares suing their own owners left and right because their owners cant sell, cant give away, and the resort wont even take it back for free and you have the perfect explanation for why this never happens.

 

[andre10056]

anyone in this country can sue anyone else for anything they like.

however there is no financial sense for a timeshare/developer/association to seek "x years worth of unpaid fees" in court because it would cost that amount or more to take that process all the way to a judge and even if you win you now begin the process to attempt to recover funds from a defendant whos likely in a different state. obtaining a judgement is only the beginning and even navigating that path is more trouble than its worth in almost all these situations.

add on top of that the optics of timeshares suing their own owners left and right because their owners cant sell, cant give away, and the resort wont even take it back for free and you have the perfect explanation for why this never happens.

If I hadn't been in a small district court once while waiting to testify on behalf of a friend who got a traffic ticket, I might agree with your belief that "there is no financial sense for a timeshare/developer/association to seek "x years worth of unpaid fees" in court because it would cost that amount or more to take that process all the way to a judge and even if you win you now begin the process to attempt to recover funds from a defendant whos likely in a different state".

I saw a collection attorney bring in forty or so cases, each one in its own individual folder, and go down the list rapid fire. Chase versus Jones. Wells Fargo versus Smith. Mike's Mechanic Shop versus Fitzpatrick. Etc., etc.. etc. I don't think there were any timeshare HOA cases but I don't see why there couldn't have been.

The unpaid creditor simply sends info (via email or snail mail) to the collection attorney in the appropriate jurisdiction (of course, out of state if that's what's appropriate) and the collection attorney adds that to the day's complaints.

Nothing arduous, time-consuming. Quick and easy, particularly since most cases are handled in seconds as the no show by the defendant leads to an immediate default judgment.

As to the "optics", how will anyone know about it if they aren't in the courtroom that day?

So the law in virtually all jurisdictions allows the timeshare entity to get a deficiency judgment. I can't believe that they simply choose not to while simultaneously refusing to accept a deed back in lieu of foreclosure.

 

[TUGBrian]

id imagine said attorney also likely collects 75 to 80% of the money disputed in fees...and even after securing said judgements comes the process of trying to collect! Plenty of benefit to him and his firm, not quite as much to the creditor.

An attorney once told me "the judge isnt going to that guys house and write me a check"

the optics I refer to isnt the actual process in court, but the public backlash if owners were commonly sued for a product they cant even give away or give back. You think timeshares have a black eye now, imagine if happened to even a single % of owners who default.

a deed in lieu is almost always the final solution in these situations but almost always after months or even years of default.

 

[andre10056]

id imagine said attorney also likely collects 75 to 80% of the money disputed in fees...and even after securing said judgements comes the process of trying to collect! Plenty of benefit to him and his firm, not quite as much to the creditor. Everything you wrote after "I'd imagine" is an assumption. That may be right or could be very, very wrong. For example, if attorney's fees can be awarded to the successful plaintiff, then the creditor still gets EVERYTHING owed to him/her/it.

An attorney once told me "the judge isnt going to that guys house and write me a check". Probably not. But receiving a complaint for the foreclosure of your home due to an unpaid judgment will likely get the formerly uncooperative debtor to change his non-paying ways.

the optics I refer to isnt the actual process in court, but the public backlash if owners were commonly sued for a product they cant even give away or give back. You think timeshares have a black eye now, imagine if happened to even a single % of owners who default. I can't imagine that timeshares can possibly get a blacker black eye than they already have. At least, that's my assumption. Moreover, the "public backlash" probably was the reason that California, Florida, and South Carolina passed those consumer-friendly non-deficiency judgment statutes in whatever past decade they did so.

a deed in lieu is almost always the final solution in these situations but almost always after months or even years of default. Which behooves a California, Florida, or South Carolina timeshare owner to suggest a deed in lieu of foreclosure right away while simultaneously making the timeshare entity's people know that you know they will never be able to get a deficiency judgment...so no reason to make threats, etc. for perhaps years in hopes of collecting something.

 

[andre10056]

Here from another timeshare oriented website (which will remain nameless as I know there's a sensitivity about naming competitors) is someone's elation at being offered a deed back in lieu of foreclosure for his South Carolina timeshare. He apparently doesn't know that the timeshare entity could never have collected a dime from him:

"Got this email form MVC after inquiring about options, and I’m thrilled.

Good day,

Thank you for contacting the Exit Services Team for The Marriott Vacation Clubs (TMVC) regarding your interest to exit your ownership Barony Beach, BB933835*B

Currently, TMVC is offering an opportunity for you to relinquish your ownership, a direct deed back, at no cost to you. While this transaction will not result in any financial proceeds, it is a quick way to exit the program and eliminate your ongoing annual maintenance fee commitment. The anticipated time to complete the ownership transfer is 120 days; however, TMVC cannot guarantee a time for completion of the ownership transfer.

The requirements to qualify for this offer are as follows: There must be no outstanding loans, maintenance fees, or taxes due with regard to the interest you seek to deed back. Owners must continue paying maintenance fees and taxes on the interest throughout the contracting period and until closing/transfer is complete. Owners who pay maintenance fees or taxes that are on account of TMVC’s agreed upon first year of usage, will be reimbursed after closing/transfer is complete. Owners of an Every-other-year ownership are still required to pay maintenance fees annually. These fees equate to half of the annual maintenance fee of an Every-year owner. For example, if an Every-year owner pays $1,500 in maintenance fees annually, the Every-other-year owner will pay $750 annually. As applicable, you may be responsible for the payment of a future year maintenance fee to cover your final year of usage, before closing/transfer can complete. First-year occupancy to TMVC in the year 2026 must be available.

Because the first-year occupancy to TMVC will be 2026, you will retain any remaining usage balance for prior years, and you will be responsible for the maintenance fees associated with those use years. Note: Any usage option or reservation you make for 2026 will cancel the deedback transaction.

The offer to deed back your ownership is valid for the next 7 business days and is subject to mutually agreeable written terms and conditions as set forth in the settlement documents, a copy of which will be provided to you for your review.

Upon receiving your acceptance of this offer, we will send an email confirmation with further instructions regarding the closing process, including procedures with regard to settlement documents, which are typically sent within 90 days of your acceptance.

Further, please note that in the event it is discovered that the requirements for this offer, set forth above, have not been met, TMVC reserves the right to terminate the deedback transaction. TMVC also reserves the right to terminate this offer at any time before full execution of the settlement documents."

 

[TUGBrian]

Everything you wrote after "I'd imagine" is an assumption. That may be right or could be very, very wrong. For example, if attorney's fees can be awarded to the successful plaintiff, then the creditor still gets EVERYTHING owed to him/her/it.

Correct, though its an assumption based on real world data and reporting, the lack of which somewhat proves the theory.

obtaining a judgement and collecting on a judgement are two very different things. the next steps require asset discovery...seeking writs or other such methods to attempt garnishment etc all of which costs the attorney doing it time and money. its certainly not as simple as walking out of the courtroom and getting paid. Ive spoken to at least a half dozen different collections attorneys and they all say the same thing.

Again im not arguing that it CANT happen, as it clearly can. it just isnt...for the reasons mentioned.

An attorney once told me "the judge isnt going to that guys house and write me a check". Probably not. But receiving a complaint for the foreclosure of your home due to an unpaid judgment will likely get the formerly uncooperative debtor to change his non-paying ways.

not if the homeowner has no intention or desire to keep the home. feel free to foreclose away! (this is why timeshares dont do that, the collateral has no value)

the optics I refer to isnt the actual process in court, but the public backlash if owners were commonly sued for a product they cant even give away or give back. You think timeshares have a black eye now, imagine if happened to even a single % of owners who default. I can't imagine that timeshares can possibly get a blacker black eye than they already have. At least, that's my assumption. Moreover, the "public backlash" probably was the reason that California, Florida, and South Carolina passed those consumer-friendly non-deficiency judgment statutes in whatever past decade they did so.

I believe those again were intended to streamline the process and get the legislation passed to allow a much easier solution for timeshares to recover deeds without having to go thru the lengthy and expensive judicial foreclosure process. combined with the point above that none of the owners in default actually wanted to dispute the foreclosure for a timeshare instead of being perfectly happy to sign it away/back.

a deed in lieu is almost always the final solution in these situations but almost always after months or even years of default. Which behooves a California, Florida, or South Carolina timeshare owner to suggest a deed in lieu of foreclosure right away while simultaneously making the timeshare entity's people know that you know they will never be able to get a deficiency judgment...so no reason to make threats, etc. for perhaps years in hopes of collecting something.

ive argued for this for years, however its clearly still effective to simply threaten "things" and get owners to send another years worth of dues!

I would imagine many resorts would find themselves in very dire straits if they cart blanche accepted deeds back for every owner that asked. Vs implementing a policy that establishes the timeline/process for handling delinquencies and walking whatever tightrope they have to to ensure the resort has enough money coming in to pay the essentials for the year per the annual budget.

Id be shocked (though would have to confirm as ive never actually verified) if the process for judicial vs non judicial foreclosure isnt identical in terms of notification(s) 30/60/90/180 day timelines etc providing the owner time to pay the overdue amount and get the ownership back in good standing. I also believe this process and the angry sounding notifications (especially when they start getting delivered via certified mail) convince a large % of owners to pay.

 

[TUGBrian]

on top of that, this theory is further proven by how successful exit/cancellation companies are at utilizing the default strategy to end ownerships.

if even a single digit % of these default-to-exit schemes resulted in judgements youd see people screaming bloody murder after paying 5, 10, 20 thousand dollars to get out of their timeshare only to be sued at the end! thousands upon thousands of owners are duped into defaulting every year by exit companies, combine that with the thousands of other owners who do the same on their own for various reasons. not having a single reported instance of a judgement for the non payment of annual fees is pretty compelling data.

though I bet some could/would be found for those owners who defaulted on large loan balances.

 

[andre10056]

not if the homeowner has no intention or desire to keep the home. feel free to foreclose away! (this is why timeshares dont do that, the collateral has no value)

Wow! Where the heck might you live? Because in most areas of the country, home prices have doubled, tripled, quadrupled, or more.

Ain't no way I'd allow my home (purchased for $60,000, now worth $700,000) to be foreclosed upon because of any unrelated timeshare non-payment judgment. I wouldn't be able to get online and make payment fast enough.

 

[andre10056]

And, by the way, that Barony Beach South Carolina timeshare owner informed everyone that he had paid his 2025 maintenance fees and just got the deedback offer. So that was a quick response to his request which I believe is due to the South Carolina timeshare entity knowing they can't collect any more from him.

 

[TUGBrian]

Wow! Where the heck might you live? Because in most areas of the country, home prices have doubled, tripled, quadrupled, or more.

Ain't no way I'd allow my home (purchased for $60,000, now worth $700,000) to be foreclosed upon because of any unrelated timeshare non-payment judgment. I wouldn't be able to get online and make payment fast enough.

perhaps we got wires crossed. id imagine most homeowners wish to fight foreclosure.

its timeshare owners that do not...and in almost all cases would be more than happy to give it up.

 

[Ski-Dad]

Wow! Where the heck might you live? Because in most areas of the country, home prices have doubled, tripled, quadrupled, or more.

Ain't no way I'd allow my home (purchased for $60,000, now worth $700,000) to be foreclosed upon because of any unrelated timeshare non-payment judgment. I wouldn't be able to get online and make payment fast enough.

A timeshare HOA cannot foreclose on your home unless you at some point gave them a mortgage on your home. The HOA would need to get a judgment against you. They would then need to go through a process of having that judgment registered in your home jurisdiction. This would then be followed by going to court to obtain a writ of execution on your home. These steps represents thousands of dollars in legal fees. Its not impossible, but is highly improbable that any HOA is going to spend that much good money chasing a delinquent account.

 

[andre10056]

A timeshare HOA cannot foreclose on your home unless you at some point gave them a mortgage on your home. The HOA would need to get a judgment against you. They would then need to go through a process of having that judgment registered in your home jurisdiction. This would then be followed by going to court to obtain a writ of execution on your home. These steps represents thousands of dollars in legal fees. Its not impossible, but is highly improbable that any HOA is going to spend that much good money chasing a delinquent account.

I envisioned the potential scenario like this: timeshare entity successfully gets a judgment. Then starts the process, via notice to the timeshare owner, of having that judgment registered in the timeshare owner's home district. That notice would be, in my opinion, enough to scare any homeowner (who might then see that his home may be in jeopardy via a potential follow-up writ of execution") to pay up immediately.

I have no idea how often that might actually happen, I hope it would be never, but I would always want to make decisions with that possibility in mind. So if I owned a timeshare in a state where deficiency judgments could be sought and might be sought, but were offered an opportunity to do a deedback relatively cheaply, I think I would choose that alternative instead of simply "walking away".

 

[andre10056]

A timeshare HOA cannot foreclose on your home unless you at some point gave them a mortgage on your home. The HOA would need to get a judgment against you. They would then need to go through a process of having that judgment registered in your home jurisdiction. This would then be followed by going to court to obtain a writ of execution on your home. These steps represents thousands of dollars in legal fees. Its not impossible, but is highly improbable that any HOA is going to spend that much good money chasing a delinquent account.

And, of course, registering the judgment in one's home jurisdiction means that it may effectively be the 1st lien on your home if there is no unpaid mortgage. So if you sell the home, the judgment (plus statutory interest: 6%?) will be satisfied with the proceeds of the home's sale. So the HOA really doesn't have to go much further than that step.

 

[Ski-Dad]

And, of course, registering the judgment in one's home jurisdiction means that it may effectively be the 1st lien on your home if there is no unpaid mortgage. So if you sell the home, the judgment (plus statutory interest: 6%?) will be satisfied with the proceeds of the home's sale. So the HOA really doesn't have to go much further than that step.

The legal fees for the HOA would likely exceed what they are owed in MF. This is why you don't see this happening.

 

[LeslieDet]

A timeshare HOA cannot foreclose on your home unless you at some point gave them a mortgage on your home. The HOA would need to get a judgment against you. They would then need to go through a process of having that judgment registered in your home jurisdiction. This would then be followed by going to court to obtain a writ of execution on your home. These steps represents thousands of dollars in legal fees. Its not impossible, but is highly improbable that any HOA is going to spend that much good money chasing a delinquent account.

"I have read this entire thread. Your statements may very well be factually correct, but you have provided little to no advice to the OP. You have always made sure you have had the last word. Now stop and reflect for a moment: "Am I being helpful?"" - those are your words if you can't recognize them...