Is this a Scam

[needtotravel]

Have been a member of Tug for a few years but have just started searching Market Place.
This person or owner says his week is free, that he pays for the closing costs and the yearly dues. Can someone go on Tug's Marketplace a post a scam?

 

[dioxide45]

Anything can possibly be a scam, but many timeshares have no value and even negative value. This requires owners to give them away for free and pay all the fees just to get rid of it. Just because a timeshare is free, doesn't mean it is a good deal to take.

 

[needtotravel]

Any idea how I can check this out?

 

[needtotravel]

Any idea how I can check this out?

What is a Negative value?

 

[jp10558]

What is a Negative value?

It just means people usually won't pay to buy it. You need to see if the timeshare is worth it to you.

EDIT: technically, that the person who's giving it away is paying to get rid of it in terms of the closing costs etc.

 

[LannyPC]

What is a Negative value?

I'll echo what jp10558 said above. I'll also add this and this is just my opinion so take it for what it's worth. Negative value for a timeshare is if the MFs exceed what can easily be fetched for a rental. So for instance, if the MFs are about $1100 per week and we frequently see rentals available for that interval in Last-Minute Rentals for about $800 per week, then it has negative value. Why pay $1100 per week in MFs when you can rent from an owner for only $800? Or, put another way, why pay $1100 per week to maintain something that you can only rent out for $800 per week?

OTOH, a week or interval has positive value if you can easily fetch for a rental well above what you pay in MFs. In some threads here on TUG, there are many owners who defend owning when they tell of how their week's MFs are about $2000 per week but rentals are about $3000 per week.

 

[Fido Chuckwagon]

Have been a member of Tug for a few years but have just started searching Market Place.
This person or owner says his week is free, that he pays for the closing costs and the yearly dues. Can someone go on Tug's Marketplace a post a scam?

Free weeks with the other side paying closing costs are not uncommon. What is worthless to one person may have some value to another. For example, I've purchased most of my Wyndham contracts for less than the closing costs (meaning the the owner's effectively paid for me to take them), and I love my Wyndham contracts.

 

[dioxide45]

I'll echo what jp10558 said above. I'll also add this and this is just my opinion so take it for what it's worth. Negative value for a timeshare is if the MFs exceed what can easily be fetched for a rental. So for instance, if the MFs are about $1100 per week and we frequently see rentals available for that interval in Last-Minute Rentals for about $800 per week, then it has negative value. Why pay $1100 per week in MFs when you can rent from an owner for only $800? Or, put another way, why pay $1100 per week to maintain something that you can only rent out for $800 per week?

OTOH, a week or interval has positive value if you can easily fetch for a rental well above what you pay in MFs. In some threads here on TUG, there are many owners who defend owning when they tell of how their week's MFs are about $2000 per week but rentals are about $3000 per week.

There are also situations where, when usage value exceeds like rental values, it can still have a positive value. I guess it kind of circles back to rental value. There are many timeshare that can be used for exchange into places where rental prices exceed maintenance fees. So those can still have a positive resale value or can easily be given away without the seller having to pay fees.

 

[DeniseM]

Not a scam: We have a whole forum dedicated to giving away free timeshares here on TUG - I've given many away, and also adopted quite a few. The best thing you can do to protect yourself is to use a professional title transfer company to ensure that you have a legally transferred title.

I would ask the owner to use LTT, a popular transfer company here on TUG, and if he doesn't want to, then I'd offer to pay for the transfer to be handled by LTT, yourself. That will protect you from incompetency and fraud.

This is who I use - they are Tuggers, they get high marks on TUG, and they are efficient and inexpensive - usually less than $300.

L.T. Transfers
www.lttransfers.com
readylegal@gmail.com
706.219.2709

 

[WaikikiFirst]

What is a Negative value?

Liabilities > Assets
Cash Out > Cash In
some combo of the above.
Let's imagine you own a TS in Mexico that costs you $1500/yr but people think (know) they can rent the same place for $1000/yr. Value?

 

[Ski-Dad]

Negative value = nobody is willing to take this for free, which requires the seller to pay the closing costs or some other financial incentive to dispose of it. It is a negative value when it costs the seller money to dispose of it.

In some cases there are factors that are particular to the seller that causes them to need to unload the unit fast so they are prepared to incur some expense to move it.

In most other cases there is no value in the timeshare because it:

• is in off-season
• is run down
• has a special assessment pending
• the MF is higher than the value of a week's stay
• any combination of the above.

If you are taking on a free unit, there are two questions you need to have a very clear answer to:

1. What is my exit strategy? It will likely be a liability for you as it was for your seller.
2. What is the reason that the current seller is giving it away, and why is that not an issue for me? (e.g. a property's low season, may be exactly when you want to go: think Hilton Head November)

 

[dougp26364]

What is a Negative value?

I have a deeded week that, for resale purposes, has a negative value. In order to transfer the deed, the managing company requires a $1,500 payment to cover future MF’s, has to be transferred to an “approved” individual (not a trust), AND has a deed transfer fee PLUS all those fees must be paid by the buyer. They won’t accept these funds from me, the “seller”. All this for a deeded week that’s not even a premier resort in an overdeveloped, seasonal destination. Just to acquire the deed would cost the buyer over $2,000 up front and it’s not even in an internal exchange system with one of the major players like Hilton, Marriott or Wyndham.

When we’re ready to get rid of the week we’ll call the managing company and they’ll either take the deed back or we’ll stop paying the annual MF’s and force them to take it back or foreclose. It’s not worth the effort to try and even give it away. For the moment it still has enough value as an exchanger and for personal use (we like the resort) and the maintenance fees are low enough that we’ll keep it rather than suffer any potential damage to our credit rating for non-payment of fees.

How can you be sure it’s not a scam? Due diligence. Request all the information needed to verify the week and who owns it. Once you verify the person advertising the week is the true owner, verify with the resort the process to transfer the title. Use a reputable transfer company that will hold everything in escrow until the deed changes hands.

 

[jp10558]

I'll echo what jp10558 said above. I'll also add this and this is just my opinion so take it for what it's worth. Negative value for a timeshare is if the MFs exceed what can easily be fetched for a rental. So for instance, if the MFs are about $1100 per week and we frequently see rentals available for that interval in Last-Minute Rentals for about $800 per week, then it has negative value. Why pay $1100 per week in MFs when you can rent from an owner for only $800? Or, put another way, why pay $1100 per week to maintain something that you can only rent out for $800 per week?

I would nitpick slightly that I would generally not count Last-Minute Rentals as the going rental cost unless there's near always a listing there (I've never seen this for ANY location over 2 years yet) OR there's almost no other rental activity. The reason is that being able to plan more than 45 days out and book further out has value in many if not most situations for most people. There's a reason there are last minute discounts - it's also to entice you to rush to take time off or try and get last minute plane tickets etc.

If you regularly see on SkyAuction or eBay or Redweek or Koala or AirB&B (I guess?) a rental for the same or less than MFs offered IDK 6 months out?? (the time out is subjective) then there's little reason to own. That said, the other thing is for everyone who already owns a timeshare and has RCI or II options, then you need to also compare the availability there too in the cash deals. So far I'd never own at Smuggs or Massanutten for instance, they're almost always in RCI Last Calls or Extra Vacations for sub $800 for a 2BR, probably 80% of the time at $500, and MFs seem to be a bit over a grand.

However, as a cheap entry / the only timeshare someone own, to get them access to RCI and those deals or the like - then some of the places like Massanutten can make sense as easy to get free or cheap, average MFs for a 2BR and at least to me not horrible places to go. It's not the most bang for buck, but compared to buying HGVC or Marriott the up front is thousands less even resale.

 

[rickandcindy23]

Have been a member of Tug for a few years but have just started searching Market Place.I
This person or owner says his week is free, that he pays for the closing costs and the yearly dues. Can someone go on Tug's Marketplace a post a scam?

I have some listed for free on Redweek and also here on TUG under the FREE timeshares forum.

I actually have Shell points I am giving away, which are really difficult to give away after Wyndham took it over. Used to be easy to give away. I may have to deed back, but Wyndham doesn't really care if I am stuck with those points.

I also listed a week 52 at Foxrun in North Carolina. The thing with Foxrun is I don't need it. I bought it 14 years ago to trade into Disney properties. Still sees most of the Disney inventory in II. I have many other weeks that also trade into Disney. No need to own Foxrun. Could I rent it? Doubtful, not even for MF's. I am paying closing and transfer fees on that one. I have ongoing searches set with this year's week and hope for a fantastic exchange opportunity. It's a great week, but I have a lot of great weeks. Way too many.

 

[goodbadugly]

I have a deeded week that, for resale purposes, has a negative value. In order to transfer the deed, the managing company requires a $1,500 payment to cover future MF’s, has to be transferred to an “approved” individual (not a trust), AND has a deed transfer fee PLUS all those fees must be paid by the buyer. They won’t accept these funds from me, the “seller”. All this for a deeded week that’s not even a premier resort in the overdeveloped, seasonal destination. Just to acquire the deed would cost the buyer over $2,000 up front and it’s not even in an internal exchange system with one of the major players like Hilton, Marriott or Wyndham.

When we’re ready to get rid of the week we’ll call the managing company and they’ll either take the deed back or we’ll stop paying the annual MF’s and force them to take it back or foreclose. It’s not worth the effort to try and even give it away. For the moment it still has enough value as an exchanger and for personal use (we like the resort) and the maintenance fees are low enough that we’ll keep it rather than suffer any potential damage to our credit rating for non-payment of fees.

How can you be sure it’s not a scam? Due diligence. Request all the information needed to verify the week and who owns it. Once you verify the person advertising the week is the true owner, verify with the resort the process to transfer the title. Use a reputable transfer company that will hold everything in escrow until the deed changes hands.

I can not speak to your specific situation. However, I just completed my exit from a Marriott gold week in Grande Vista in Orlando. I did not have to "throw any good money after bad". So I took the "deal"!

 

[TUGBrian]

very few if any scams on the resale side (with people pretending to be selling $1 timeshares).

that said, not all $1 timeshares are worth the asking price as explained above! but $1 sure makes them more attractive than paying full retail!