Harbour Point maintenance fee increase

[SueDonJ]

I would love to know what they can legally do with the weeks with unpaid fees prior to foreclosure. I'm sure they are buried in the recorded documents somewhere. We know that the Interval getaways are excess inventory from people who have traded their weeks to Interval for other weeks. We also know that Marriott can rent the weeks that are traded for Reward Points. Can there be a "bucket" for unpaid maintenance fee? If not, the association should foreclose quickly and have an auction. I've occasionally seen posts here on TUG of reported scheduled auctions by the timeshare associations.

It sounds to me like they aren't moving these off the books fast enough. Marriott might grab them on ROFR, but who cares?

Is it possible that there is a line-item somewhere on the financials that shows money coming in through assn-owned units that sold that is offsetting the bad debts?

I think that based on the governing docs that I have for my resorts there's no question that MVW can assume rights to ownerships that are in arrears, no question that MVW does assume rights and responsibility for ownerships in foreclosure. The fact that MVW has petitioned for and been granted rights by several states, SC and FL that I know of, to perform non-judicial foreclosures (where judicial is otherwise indicated or mandated) points directly to the fact that MVW intends to streamline the foreclosure process.

I don't know if the HOA is empowered to foreclose on non-performing intervals - the only ones I know of were I believe actioned by MVW as the Developer/Manager.

I'm of two minds that MVW or the resort HOA's (where/if it's allowed) should be required to foreclose and assume responsibility for non-performing intervals. The shareholders would certainly object to MVW saddling itself with low-demand inventory that doesn't generate fees to cover its operation, as would the Owners permanently saddling themselves with such inventory. The fact is some Weeks simply do not pay for themselves and will not be re-owned easily, and unless it's a requirement in the governing docs it's understandable why MVW and/or the HOA's are reluctant to assume them.

As for the offsets showing in the Operating Budgets it's possible that they're included as a component of a line item rather than as an individual line item, and that getting to them would require an audit or a review of the mandated independent audits that are already routinely performed. I don't know exactly how it works but it being a component is what makes sense to me.

 

[dioxide45]

I would think that non performing intervals weeks would end up going to Marriott to rent for profit. Since the owner can't make a reservation, Marriott can take those, usually at the 75 day mark, and do with them as they see fit. Mostly for their profit, not necessarily to reimburse the HOA for losses on bad debt. I don't see how these would be any different from an owner that is current and just fails to call and make their reservation.

Ultimately the property manager, in this case Marriott, is empowered by the HOA to file foreclose notices and perform foreclosure action on behalf of the HOA. So the HOA isn't actually foreclosing on the weeks, MVW is doing this for the HOA. If the week doesn't sell at foreclosure sale, then the HOA assumes ownership. Some properties have buyback agreements with Marriott where any foreclosed weeks will be bought back by Marriott. Marriott may or may not pay the unpaid MFs. I know I have seen information in Harbour Lake meeting minutes about buyback agreements. Perhaps Harbour Point does not have such an agreement and it is also likely that Marriott doesn't want to buy the weeks back anyway.

Any issues about bad debt really need to be taken to the BOD to find out what they are doing to try to prevent bad debt expenses. Foreclosing on a week doesn't fix the problem. The HOA can only rent that week out to off-set the MFs once they assume ownership through foreclosure.

 

[suzannesimon]

In a regular condo assn, the assn forecloses to get properties for non-payment of fees. The process can be managed by the management company. So Marriott gets the property back in a foreclosure of their timeshare resorts not the association? I totally understand the problem, however, if these are mud weeks that no one wants to own. That could become a real nightmare over time - an owner can't afford the fees, can't rent it, can't sell it and the HOA/Marriott don't want to own it either. I don't want anyone to buy Silver season - let Marriott keep them and pay the fees!

 

[dioxide45]

In a regular condo assn, the assn forecloses to get properties for non-payment of fees. The process can be managed by the management company. So Marriott gets the property back in a foreclosure of their timeshare resorts not the association? I totally understand the problem, however, if these are mud weeks that no one wants to own. That could become a real nightmare over time - an owner can't afford the fees, can't rent it, can't sell it and the HOA/Marriott don't want to own it either. I don't want anyone to buy Silver season - let Marriott keep them and pay the fees!

Marriott is just acting on behalf of the HOA to foreclose. Unless someone buys the week at foreclosure sale, the ownership goes back to the HOA. Marriott would only get the week if they buy the week at sale or they are foreclosing because they are foreclosing against a mortgage where they are the holder. With many mud season weeks that don't sell at foreclosure sale, the HOA assumes ownership of the week, not Marriott.