How to give up Wyndham Timeshare

[kiran]

Hi,

I have the Club Wyndham Access with 289000 points. I have $46000 left on the package. With my monthly dues of about $825 and $155 for monthly maintenance, I am planning to give it back. It is hitting me financially. I am looking for directions on how to give it back or sell it. Most of the selling firms ask for upfront fees for advertisement. Cant trust them.
Not sure if it is worth keeping it either. Thanks for your time.

Kiran

 

[harveyhaddixfan]

Unfortunately there is little to no resale value in what you’ll have. It’s not likely that you’ll find anyone to buy it and Wyndham won’t “take it back” unless it’s paid for.

 

[chapjim]

Unless you are still within that short period during which you can rescind, I can't think of any good way to do this still owing $46K on the purchase.

 

[ecwinch]

I would be walking away. Especially given the high balance and since it sounds like you are still on Wyndham’s financing with 12%+ APR. That is too big of a hole to be in for 7-10 vacation days a year. When is the loan paid off - in 8-10 years?

And most of the upfront companies take your money and leave you with same outcome - in default.

 

[kiran]

I was thinking about walking away but again it will be reported to credit bureau and a foreclosure will follow for which i would have to pay for the tax on the remaining balance to IRS. APR is very high about 16.5%. I thought of paying it of by refinancing my home to avoid the high interest rate. It is a 10 year loan which started in Jan-2018. Since my refinance got rejected, i am thinking of other options.

 

[harveyhaddixfan]

I hate to say it, but the best option might be bankruptcy. It’s a better option than foreclosure. And I’d highly doubt they’d do something like a deed in lieu of foreclosure.

 

[kiran]

I already have a bankruptcy on me before. so that is out of question. when i checked with wyndham, that is what they mentioned. They would wait for 150 days before they go for foreclosure and then the IRS would send the pending tax on the amount pending. Maybe they try to write it off.

 

[Passepartout]

You are clearly between a rock and a hard place. Bankruptcy is designed to give debtors a second chance. An opportunity to learn how to manage debt. Somehow, you missed the message. Wyndham won't take it back. No one will buy it - or even just take it over while there is a 16% note against it. Have you looked on eBay to see what similar ownerships to yours are worth- even paid off? Darn little is what!

I don't have advice, because you've really left yourself no way out. Well, ONE- and here it is.

Get another job-or two, and pour every penny you make into paying down that note. Not the minimum monthly payment, but EVERY CENT! It will hurt, and your social life will be messed up, but that's the only way out. Oh, and cut up your credit cards, and DON'T BORROW ANYTHING MORE!

I'm sorry to come off as harsh, but my wife practices family law- and a significant number of her clients have been bankruptcy clients. Her object was, and is, to never see them in her office again for that.

I wish you luck- and success. You have some serious wood to chop, but with work, you can do it.

Jim

 

[bnoble]

I already have a bankruptcy on me before. so that is out of question.

Maybe you should stop borrowing mid-five-figures to buy discretionary items.

 

[kiran]

Thanks for the advice. Just wondering how bad the credit will hit if i give it up without making further payments. My score is already in low 600. Would have been lower if not for mortgage and car payments.

 

[Silverdollar]

I agree with the advice already given, but I would also suggest a 1 on 1 financial coach to help you sort through this situation. I highly recommend Dave Ramsey's organization. I personally know of individuals that have overcome big financial messes by following their advice. Here is the link: https://www.daveramsey.com/coaching/?snid=classes.1on1coach

 

[kaljor]

You only have two choices; either keep paying it or stop paying it. Before you do either, you should speak to the attorney who handled your last case.

You caught a break when you were denied that home refinancing option. I would never risk my home just to try to pay off a timeshare. For that reason, I wouldn't try to refinance by taking a personal loan either. As long as Wyndham or their bank partner is the loan holder, they have motivation to deal with you.

You talk about foreclosure and the tax on the remaining balance. I assume you're referring to income tax owed if they forgave the loan. That would be the last of my concerns. If somehow they forgave the remaining loan balance and let me out my obligations, I would be thrilled to only have to pay the tax on that, no matter what it came to. If you can get out of this, there will always be some cost, even going through bankruptcy has costs.

There are also specialized Timeshare attorneys. I saw a couple of videos on You Tube and I take them with a grain of salt but there was one woman who seemed knowledgeable and sincere. I would look her up and check her out and if she offers a free consultation, I would explore that.

Good luck.

 

[kiran]

Thanks kaljor for your inputs. my last attorney is not worth as they close their shop in my city. lot of complaints against them too.probably i will check out any free consultation around and see where it goes. just wondering how much would the income tax be if the loan is written off.

 

[paxsarah]

Thanks kaljor for your inputs. my last attorney is not worth as they close their shop in my city. lot of complaints against them too.probably i will check out any free consultation around and see where it goes. just wondering how much would the income tax be if the loan is written off.

Here's the thing. Even if you had to pay income tax on the amount written off, it's by definition a fraction of the entire amount you owe. If you were to pay off the entire $46,000 plus interest, you would not end up with something in your hands that you could sell for $46,000. You would be lucky to be able to sell it for $1,000.

I am not advocating either way for going into foreclosure on the debt, I'm just arguing against the potential income tax hit being a deciding factor. It's still a much smaller hit than the entire $46,000.

 

[Skipper Scooby]

If you don't want to file for bankruptcy, I have a few suggestions. The 1st thing to do is get a loan to pay off the timeshare with Wyndham. I'm sure the interest rate Wyndham is charging you is allot more than the interest rate you could get a loan for. If you are a home owner, maybe you could get a home equity loan. Most of those have no closing costs. Once you don't owe Wyndham anything on your loan, then see if you can give the timeshare back to Wyndham through their Ovations program. If your timeshare is valuable in their eyes, then you could see if it qualifies for the Limited Edition program. That's where Wyndham will give you 3 years of points for free in exchange for your timeshare. The only way you can give the timeshare back to Wyndham with these programs is that you do not owe them anything on your loan with them. Then there will be no more maintenance fees and you will just have to settle your loan with the bank. Good luck to you with this.

 

[ecwinch]

I would agree with those who feel the tax implications of foreclosure should not be the driving factor. We are close enough to the end of the tax year, that you could make this a 2019 tax event. And a year of your current payments would likely cover the potential tax liability.

In terms of the impact of foreclosure - here is one reference.

https://www.nolo.com/legal-encyclopedia/consequences-timeshare-foreclosure.html

 

[Dis.Dad]

What the IRS does is look at it as if you made $46,000 extra this year. Money that you have not paid the tax on, so that increases your income earned for the year by that much. How much that affects you personally, check with your tax accountant. I was in a similar position last year and it flipped me from typically getting a $1000-1500 refund to having to pay out about $3000. Good luck!

 

[breezez]

I was thinking about walking away but again it will be reported to credit bureau and a foreclosure will follow for which i would have to pay for the tax on the remaining balance to IRS. APR is very high about 16.5%. I thought of paying it of by refinancing my home to avoid the high interest rate. It is a 10 year loan which started in Jan-2018. Since my refinance got rejected, i am thinking of other options.

I don’t think it would show as a foreclosure you did not buy real estate you simply bought a membership with a fixed number of points no deeds were recorded in your name.

It would show as a consumer default if you walk, but be prepaired for tons of calls.

They have great lawyers and I am sure have a close to air tight contract as possible. But even great lawers make mistakes. Some states require sellers of travel numbers to sell travel did you make transaction in one of those states and is the number clearly listed in your documents. It’s stuff like this that might give you a get out of jail free card.

 

[Dave Landry]

Please avoid a home equity loan at all costs. Right now this loan would not cost you anything except for a hit in your credit score should you not be able to pay. Definitely nice to pay less in interest but is the risk of losing your home worth it?

 

[cbyrne1174]

Since you already have car payments and a mortgage, I would let it foreclose. It sounds to be like you already have a car and a house and don't need a good credit score for the next 7 years. Keeping an extra 10k handy makes sense in case you run into unexpected problems. Credit scores are only for financing things. If you don't need to finance, you don't need a credit score. Double check that they can't put a lien on any of your other assets before defaulting though.

 

[kiran]

It has been over 120 days since i made the payment. Collection calls have already started. Waiting on 150 days before they send it for foreclosure. Is it true that i would be taxed for the deficit amount they ($46000 - amt my points gets sold for) in case of a foreclosure. This being a deeded property, in FL - not sure what are the laws concerning this foreclosure. Waiting for the next steps from Wyndham.

 

[55plus]

I don't think you will have a tax liability because you will gain nothing.

 

[grab]

It has been over 120 days since i made the payment. Collection calls have already started. Waiting on 150 days before they send it for foreclosure. Is it true that i would be taxed for the deficit amount they ($46000 - amt my points gets sold for) in case of a foreclosure. This being a deeded property, in FL - not sure what are the laws concerning this foreclosure. Waiting for the next steps from Wyndham.

Your first post said this was Club Wyndham Access which by definition has no deed.
Your last post says it is deeded in FL.
Both can’t be true.

 

[kiran]

True, my bad. I do have club wyndham access but i keep hearing these pending mortgage payments from debt collectors. I am confused as to how can it be foreclosed if it is not deeded. It is just a fixed point system/year for lifetime. Not sure what will be the impact other than impacting the credit history. Isnt the impact similar to credit card delinquency ?

 

[55plus]

True, my bad. I do have club wyndham access but i keep hearing these pending mortgage payments from debt collectors. I am confused as to how can it be foreclosed if it is not deeded. It is just a fixed point system/year for lifetime. Not sure what will be the impact other than impacting the credit history. Isnt the impact similar to credit card delinquency ?

Basically you'll take a hit on your credit report through the credit card company that provided the funds for the timeshare. You'll also be hounded by bill collectors so learn the laws governing what they can and can't do. If they violate the law you may come out ahead and profit from this ordeal. If you ever want a timeshare again, buy resell!