Mortgage recital to exit timeshare?

[dioxide45]

Maybe, but it's not mortgage debt on a timeshare at this point, it was debt put on a credit card to pay off the timeshare points that were purchased. I can only imagine the interest rate once the 0% teaser rate expires. I'm not sure how to go about disputing a 1099 with IRS, it can't be that simple.

The statement about IRS charging 25% tax is wrong, COD is reported as income, so it's taxed at whatever bracket you are in. It could be as low as 10%, the first bracket.

I don't beleive it was all on credit card, only $11K. So the 11K can't be disputed. If you default on the credit card they can sue and obtain judgement. It will kill your credit. The only way out is personal bankruptcy or try to negotiate a lesser amount to be considered paid in full. Of course any amount that is charged off would be considered income and subject to the 1099-C. Once you use a credit card, the debt is not secured by the timeshare. A mortgage on a timeshare is of course very different. I would really question the validity of a 1099-C received because you defaulted and they foreclosed on a timeshare loan. Theoretically, no one lost money on the timeshare loan. The timeshare company just resells the timeshare. They may have special arrangements on how to handle defaults when they sell timeshare notes to an investor in a securitization deal.

 

[TUGBrian]

I agree and I did talk to an attorney one time who said a 1099-C should be disputed if it came from cancellation of timeshare debt. Though the attorney didn't really have any experience doing that so no idea if it would work. Timeshare mortgage are more like seller financing. There isn't some bank behind the scenes funding your loan like there is on a traditional real estate mortgage. There are no wire transfers. The timeshare company may letter sell those notes to capitalize the notes, but when you buy a timeshare with financing, the timeshare company isn't getting a big pile of cash from someone. They are simply getting the monthly payments. Also akin to buy here pay here.

it has been well documented that despite it being a loan for "technically" a piece of real estate, that a timeshare mortgage is that in name only and is not considered an actual mortgage...vs an unsecured loan.

the lender certainly isnt going to take your timeshare from you if you dont pay...its not collateral at all! even they are well aware you are being loaned money for a product that has no actual monetary value.

 

[TUGBrian]

just to clarify, the only active goal of a timeshare exit company is deedback or foreclosure/default, and thats if they even bother to lift a finger at all after they are paid.

both of these options you can negotiate or accomplish your self without any need to pay someone.

In this case, they are putting more effort into extracting even more money from you than anything related to getting you out of your timeshare.

 

[dioxide45]

just to clarify, the only active goal of a timeshare exit company is deedback or foreclosure/default, and thats if they even bother to lift a finger at all after they are paid.

I do recall from reading the Ramsey lawsuit that they did, in some cases, try to help the customer with a deedback through the official deedback programs. Very rare though as once the timeshare company found out you were working with TET or any timeshare exit company, your account was flagged and they would no longer negotiate with you. They even halted foreclosures on those flagged accounts. All in a way to make it so Timeshare Exit Team couldn't claim they got the customer out of their timeshare.

Two of the clients reported that they later went through the official deedback programs themselves, so as you say, in most cases they didn't even bother to lift a finger. It was all just taking money in and using it to pay for advertising to bring even more money in.

I don't understand what was wrong with the old postcard model (while still questionable) at least they tried to market your timeshare for a $0.01 starting bid on Ebay. In many cases paying all closing costs and even sometimes a year of MF for free usage out of the proceeds they got from their victims. I guess there wasn't enough money in that business model.

 

[TUGBrian]

I do recall from reading the Ramsey lawsuit that they did, in some cases, try to help the customer with a deedback through the official deedback programs. Very rare though as once the timeshare company found out you were working with TET or any timeshare exit company, your account was flagged and they would no longer negotiate with you. They even halted foreclosures on those flagged accounts. All in a way to make it so Timeshare Exit Team couldn't claim they got the customer out of their timeshare.

Two of the clients reported that they later went through the official deedback programs themselves, so as you say, in most cases they didn't even bother to lift a finger. It was all just taking money in and using it to pay for advertising to bring even more money in.

I don't understand what was wrong with the old postcard model (while still questionable) at least they tried to market your timeshare for a $0.01 starting bid on Ebay. In many cases paying all closing costs and even sometimes a year of MF for free usage out of the proceeds they got from their victims. I guess there wasn't enough money in that business model.

that only happened after the business model began exploding. it was only much later that diamond and wyndham and such created a policy to not negotiate with customers who had engaged exit companies.

are plenty of liquidation firms that still rely on the ebay $1 free closing plus gift card model, heck id gander that more than half the listings on ebay are from one or more of those organizations. heck some even post listings right here on TUG as its way cheaper than ebay!

their source of inventory is likely a variety of places, including some exit companies.