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Poipu Point - Walk away from ownership?

T_R_Oglodyte

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Hey -we haven't rec'd a special assessment notice, we own points through The Hawaii Collection DRI which includes Point Poipu, Kaanapali, and some locations in Nevada and Arizona. I REALLY hope that we will not be a part of this. When we first bought a week at Kaanapali through Embassy - later Sunterra we got a whopping special assessment for remodeling.

Does anyone know about if points are different than weeks? I prepaid our 2012 MF a couple months ago as we were booking for June and no mention was made then of any extra owed.

I know this doesn't help the OP, but knowing if there is a difference will help me and hopefully others. Thanks!

You will pay your share of the rebuild through your annual fees due to the Trust. The trust is like any other deed-owner at the property - and the trust is getting the same assessment for each and every deed it owns. The trust will simply add that to the all of the other fees it receives for all of its deeds, and then pass that on to the Trust members in porportion to the number of points each trust member owns.

The first installment should show up on your fees statement. It may not be broken out separately as Poipu special assessment, but it will be included.
 

LisaRex

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In their letter to owners, the Board of Directors did mention the 10-year statute of repose as regards inability to pursue relief from the builder.

Statutes of limitation usually start running only after discovery. So if the water intrusion was discovered in 2005, you should have until 2015 to file suit.
 

T_R_Oglodyte

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Statutes of limitation usually start running only after discovery. So if the water intrusion was discovered in 2005, you should have until 2015 to file suit.
Statutes of repose are not the same as statutes of limitation. Most importantly, statutes of repose run from the date of completion. They are very common in construction law; as of 2006 46 of the 50 states in the US had statutes of repose for real property improvements. Hawaii's is ten years

(a) No action to recover damages for any injury to property, real or personal, or for bodily injury or wrongful death, arising out of any deficiency or neglect in the planning, design, construction, supervision and administering of construction, and observation of construction relating to an improvement to real property shall be commenced more than two years after the cause of action has accrued, but in any event not more than ten years after the date of completion of the improvement.
 
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ondeadlin

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There is an argument to be made for walking away from a large mortgage rather than being saddled with a lifetime of payments over a property that is no longer worth what you paid for it.

I would disagree with that argument, but I understand it.

It's much, much tougher to make the case for walking away for any debt under $20k. It absolutely will destroy your credit 7 years and will hurt it for longer than that.

It's hard to recommend anyone walk away from a timeshare loan or payment unless you fundamentally can't pay it. Obviously if you can't pay it, you can't pay it.

Now, all that said, I imagine a very large proportion of P@P owners will walk away. Why? Because some simply can't pay and some simply won't realize how much walking away will hurt them.

I'd urge anyone thinking of walking away to consult with a creditor/debtor counselor or attorney before doing so.

Obviously the best-case scenario would be a deed-back, but I'm not sure that option exists.
 

wilblau

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what's the value of a loser t.s.

We have a every-year floating oceanfront unit we bought back in 1996 when it was Embassy...and a second every-other-year oceanfront unit we bought in 2004.

We have been trying to sell both the units but on the secondary market, they go for $1500 at best and then too, they are not moving...

We are considering abandoning/walking away from both units - in this economy, shelling out $5,400 for 2012 and $3,300 for 2013 and then again $5,400 for 2014 is a financial drain that we simply CANNOT afford.

I don't know whether our credit will take a hit...or whether we can negotiate an exit or come to a deal. We are willing to give up both units. It is simply unaffordable.

I do know that Diamond will come after us with a vengeance if we default on the maintenance fees. They are one of the most ruthless companies i have dealt with in a very long time. Their customer service is atrocious - their operators are downright nasty and all they care about is money. They have little, if any, regard for their owners and they are of absolutely ZERO help. Calling them has been next to useless...essentially, the specialist I spoke to flipped me the virtual bird on the phone.

So I researched this matter on the web and came across this portal.

Please, if anyone has any idea, experience or recommendations, I would be mightily obliged.

Thanks.

Raj

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if it is truly a loser and you can salvage $1500 or there abouts, it may be better to be someone else's headache than yours. if you are going to use it or rent it perhaps it might be worth keeping if the place is worth the stay. Like a piece of jewelry, it's only worth the weight of metal or jewels someone is willing to pay for it. Take time to consider selling and if you really want out, get out--hard times make headaches for everyone
 

lenbeil

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New Point at Poipu Owner

I bought an every year 2 bedroom at P at P last year and just found out about the $5800 assessment. Lady was very nice explaining it all. Very disappointed, but plan to pay and enjoy the resort. We experienced the same thing in 1992 when we bought at the Cliffs Club on the secondary market. Shortly thereafter incurred major Special Assessments similar to this. I guess that is the breaks of life. We have lots of wins and occasional losses and big disappointments. I too feel your pain!
 

ampaholic

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Odd ...

I think the really odd part of this whole dust up is this quote from the SA paperwork ...

During the past several years, your AOAO Board authorized three investigations to determine the extent of the damage and formulate a course of action to remedy the situation, which included the possibility of filing an insurance claim. The insurance claim was denied.

So ... several years ... three investigations ... and they just now spring the 5800 SA !!!!!!!!!!!

I think this was known about for some time ... why was the information not shared?
 

dougp26364

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There is an argument to be made for walking away from a large mortgage rather than being saddled with a lifetime of payments over a property that is no longer worth what you paid for it.I would disagree with that argument, but I understand it.

It's much, much tougher to make the case for walking away for any debt under $20k. It absolutely will destroy your credit 7 years and will hurt it for longer than that.

It's hard to recommend anyone walk away from a timeshare loan or payment unless you fundamentally can't pay it. Obviously if you can't pay it, you can't pay it.

Now, all that said, I imagine a very large proportion of P@P owners will walk away. Why? Because some simply can't pay and some simply won't realize how much walking away will hurt them.

I'd urge anyone thinking of walking away to consult with a creditor/debtor counselor or attorney before doing so.

Obviously the best-case scenario would be a deed-back, but I'm not sure that option exists.

The problem with this theory is the assumption that the lein holder won't come after you once the property has sold, if it's sold at a loss. There have been articles I've seen lately indicating banks are begining to go after those who walked but could afford the loan payments.

To walk because of these assessments might result in an action taken by DRI to collect if they feel the individuals had the ability to pay.

On the other hand, taking legal action against a large number of individuals in various states could be more costly than the amount they are trying to collect. They may simply turn it over to collections and, if that fails, write it off as a bad debt and repport it as a bad debt on the credit file.

I have empathy for those facing such a large assessment without warning. We would either have to withdraw funds from our savings accounts or take out a loan to pay those fee's. Neither option is attractive to me but, it would be easier to withdraw from savings, then systematically put it back on a monthly basis over the next year. We are fortunate to be in a position where we can do that and, in fact, did have to do this due to an unexpected illness with my wife and an unexpected ER visit with follow up doctors visits and additional testing for me. Thank goodness I work in a field where, at least up until last week, I have been able to work plenty of overtime.
 

LisaRex

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The problem with this theory is the assumption that the lein holder won't come after you once the property has sold, if it's sold at a loss. There have been articles I've seen lately indicating banks are begining to go after those who walked but could afford the loan payments.

Was this for privately owned homes or timeshares?

I heard an interesting program on NPR a few months ago. They were interviewing two families who were upside down on their mortgage. One couple, a military family, couldn't sell their home after the husband was relocated to another city, without having to write a hefty check to the bank. So the husband and wife/children were living in two different cities. He flew home to see them twice a month if he could get a cheap flight.

The other homeowner, a childless couple, decided to walk away. The interviewer asked him if he felt that it was unethical to do so. His answer was basically, "If I was a company instead of an individual, would you feel it was unethical for me to go out of business? Because that's what I've done. I don't want to lose money any more. That would be stupid."
 

ampaholic

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-snip-

The other homeowner, a childless couple, decided to walk away. The interviewer asked him if he felt that it was unethical to do so. His answer was basically, "If I was a company instead of an individual, would you feel it was unethical for me to go out of business? Because that's what I've done. I don't want to lose money any more. That would be stupid."

I doubt if Freddie Mac or Fanny Mae would underwrite a loan for a business so in essence this guy is presenting a red herring.

If he had had a minimum of 25% (business loan) skin in the game - he wouldn't be walking away - but at 3% sure why not.
 
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Nrthstr

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No voluntary surrender

I just went to the DRI website and didn't find anything about the voluntary surrender policy. I spoke with a representative, who told me that they no longer are allowing voluntary surrenders for any of their properties. The options are paying on time or going into collections. (Oh yeah, early payment also is an option, "in case that makes it easier.") Let me know if you have any ideas. We don't have the $3,000.
 

lv_maui

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How long did they know??

DRI knew about this problem for the last 2 years or so. They will claim that they did not know the extent of the problem until recently? They will also claim that they did not know how to fix it until recently also?

But if you asked them for an honest, 50-50 question on how much it will cost to fix a year ago, I bet they will tell you that it will be in the thousands per week. So they knew but they will never admit it.

One of the many legal cases coming from this will be the lack of disclsoure to the State of Hawaii regulators and their lack of disclosure in the public report about this for the last 2 years or more. Anyone who bought under that public report has a case for rescission since Diamond did not disclose it but knew something about it. The State may take a tougher stance on this issue. This is only my opinion but I am sure someone is going to challenge this. (I should first ask if there is any disclosure in the public report about water instrusion issues first since I do not have it, I just assumed it is not in there).

I think the really odd part of this whole dust up is this quote from the SA paperwork ...



So ... several years ... three investigations ... and they just now spring the 5800 SA !!!!!!!!!!!

I think this was known about for some time ... why was the information not shared?
 

dougp26364

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Was this for privately owned homes or timeshares?

I heard an interesting program on NPR a few months ago. They were interviewing two families who were upside down on their mortgage. One couple, a military family, couldn't sell their home after the husband was relocated to another city, without having to write a hefty check to the bank. So the husband and wife/children were living in two different cities. He flew home to see them twice a month if he could get a cheap flight.

The other homeowner, a childless couple, decided to walk away. The interviewer asked him if he felt that it was unethical to do so. His answer was basically, "If I was a company instead of an individual, would you feel it was unethical for me to go out of business? Because that's what I've done. I don't want to lose money any more. That would be stupid."

It was privately owned homes.

Anytime you owe money and have the ability to pay but refuse, you're on the hook. Car loan, home loans, credit card loans et......it doesn't matter.

As an example, in the mid 80's I was divorced from my wife. She kept the new car and the loan that went with it. She failed to make the payments, the car was repoed and Ford Motor Credit then sold the car at auction for a loss (She had wrecked the car and had not had it fixed). They then came after me for payment of the difference since my name was still on the loan. In the end, that's what tipped the scales and put me into bankruptcy.

Sure I had a divorce decree that set out her obligations but, when she didn't pay them I was still responsible for them and, according to the lawyer, I had to pay them, then go after her in court for reimbursement.

If you owe the money, you can always walk away but the lein holder has legal remedies to use. It's up to them to decide if it's worth the expense of getting a judgement.

Walking away isn't as easy as the news media often makes it out to be. There are people who have walked on a mortgage because they were upside down, only to find out down the road that, when the bank sells the home at a loss, they're still responsible for the balance.

In this case, the assessment falls before the default. I would be afraid if an owner walks and, if DRI deems it resonable to seek a judgement, then the owner (former owner if the deeded week was foreclosed on) could still be held liable for the fee's if they had the reasonable ability to pay them.

The trick here is, will DRI spend the money going after those that default and, would there be a ressonalbe chance DRI would be awarded the defaulted fee's PLUS any fee's associated with getting the judgement?

Before walking, it might be worth paying an attorny to see what the consequences might be. I'd hate to get blind sided a year or two down the road by a legal judgement that either had to be paid or, file bankruptcy to avoid.

I'm not expert. I'm just saying this is something I'd be concerned about based on my past experience.........which occured in the mid 1980's. Things change and I could be a long way off base but, it's something I'd want to make sure of rather than feel self assured it was a done deal if I just didn't pay.
 

dougp26364

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I just went to the DRI website and didn't find anything about the voluntary surrender policy. I spoke with a representative, who told me that they no longer are allowing voluntary surrenders for any of their properties. The options are paying on time or going into collections. (Oh yeah, early payment also is an option, "in case that makes it easier.") Let me know if you have any ideas. We don't have the $3,000.

If I were in this position and, if I didn't have money in a saving account, then I'd be looking at either default with the potential for bankruptcy if DRI came after me (seems drastic for a $3,000 debt) or, I'd be looking at taking out a small loan, perhaps an advance on a credit card, that I could reasonably pay off over the course of 3 to 12 months.

I hope to never see something like this happen at any resort I own but, I have one in Branson where the developer defaulted and the ground the timeshare sits on is part of the bankruptcy. I'm watching the situation closely but fear I could see a similar bite in the keaster when the dust is settled. I'm begining to make plans to face a potential situation as the Point owners are now facing should something unexpected happen in bankruptcy, such as forcing the HOA at my resort to buy out the loan on the land that the timeshare buildings are sitting on.
 

T_R_Oglodyte

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I just went to the DRI website and didn't find anything about the voluntary surrender policy. I spoke with a representative, who told me that they no longer are allowing voluntary surrenders for any of their properties. The options are paying on time or going into collections. (Oh yeah, early payment also is an option, "in case that makes it easier.") Let me know if you have any ideas. We don't have the $3,000.

Did you got to the DRI message board forums as I suggested? Look for the link - should be near the bottom of the DRI webpage. As of a couple of weeks ago the DRI reps were still saying that DRI would take back deeds.
 

petekrantz

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I own two weeks garden view at P@P. One bought 10 years ago one just bought in April, no one disclosed this fee up coming, I just asked a rep. from DRI if there was a voluntary surrender program and he said NO.
I would be curious what "point only" owners are assessed? They have been trying to get us to change for years.
 
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Poipu Point Bailout for DRI

As a owner of 15K Points with the Hawaii Collection, I am totally disappointed with the lack of "communication" by DRI. It was not until last nite that my maintenance fees for 2012 were posted and there was no explanation for the doubling of the fees. I found out about it thru my daughter who owns a timeshare at Poipu Point. I agree with one of the more recent posts that if DRI and or Sunterra knew about this problem it should have been "disclosed" to the purchasers prior to making the purchase. I am currently exploring this exact issue with an attorney in hopes of getting out of the contract. I purchased at Poipu Point originally in 2005, but switched to the Hawaii Collection on Maui in 2009. Seems to me that everyone should get together on this matter and file a "class action lawsuit" against DRI.
 

timeos2

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So are the owners just at the mercy of these HOAs who can charge anything they want for these assessments?

What if it was $7500, $10k, are owners just stuck paying? That just seems wrong. There should be a cap on these things and if it exceeds a death blow vote can take place and the TS dissolved and sold for return to owners.

That may be to simplistic but it just seems like the littel guy owner again gets the short end and the corporation with the deep pockets is spared.

They can & must by law charge whatever it takes to maintain You repair the property. They tAke on that sometimes unpleasant obligation while owners take on the obligation to pay whatever they assess. That is how shared ownership of condos/timeshares work by law. If you don't want that obligation then don't buy in. It is that simple.

Suing the Association is suing yourself and usually does not work out well in these cases.
 

LisaRex

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It was privately owned homes.

Yes, of course it was. I'm not advocating a position either way. But I can't imagine that a timeshare company who sued owners who walked away from their timeshare following such a debacle, will stay in business long. Would you buy a timeshare from DRI? I certainly wouldn't.

Someone dropped the ball on this project and it wasn't the owners.
 

bogey21

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Disclaimer: I'm not an owner here and have never seen the Resort. But has anyone considered a vote of the Owners to see if they would prefer removing the building; selling the land; and distributing any net proceeds to the Owners as an alternative?

George
 

T_R_Oglodyte

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Yes, of course it was. I'm not advocating a position either way. But I can't imagine that a timeshare company who sued owners who walked away from their timeshare following such a debacle, will stay in business long. Would you buy a timeshare from DRI? I certainly wouldn't.

Someone dropped the ball on this project and it wasn't the owners.

Actually, it's not DRI that would go after owners for default. It would be the HOA (technically, the Association of Apartment Owners, or "AOAO" as is appears on resort materials) for the resort, i.e., the remaining owners who were not in default.

*******

Bear in mind that the real latent power at the resort lies with the Trustee for the Hawaii Collection. The Hawaii Collection owns about 40% of the deeds at Poipu - that means they also have close to 40% of the voles for the AOAO. That's probably sufficient for them to put onto the board whomever they want.

The trustee has a fiduciary duty to Trust owners to manage the Trust in fiscally responsible manner. Failing to do so can expose the Trustee to direct liability for damages to the trust members. Not what the Trustee wants to have happen.

So, in the end, if the Trustee decides it is fiscally prudent to pursue collections against defaulted owners, that is what will likely happen. The trustee is under no obligation to do what is best for Diamond; in fact doing what is best for Diamond at the expense of Trust members is the very definition of breach of fiduciary duty.
 
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ladyp34

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I own two weeks garden view at P@P. One bought 10 years ago one just bought in April, no one disclosed this fee up coming, I just asked a rep. from DRI if there was a voluntary surrender program and he said NO.
I would be curious what "point only" owners are assessed? They have been trying to get us to change for years.
Yes, I called as well. All DRI properties have stopped voluntary surrenders as of September 10, 2011. Isn't that just great?

I'm looking for a solution as well. I have tried to sell, give away, etc. this timeshare at Grand Beach. I've no idea what to do now.
 

T_R_Oglodyte

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Disclaimer: I'm not an owner here and have never seen the Resort. But has anyone considered a vote of the Owners to see if they would prefer removing the building; selling the land; and distributing any net proceeds to the Owners as an alternative?

George
The problem there is getting all of the owners to vote to agree. There will always be some that will vote to rebuild. Unless there is a provision in either the condo program documents or state statutes governing condo projects that would allow such a decision to be made without unanimous consent, getting all of the owners to vote together is essentially impossible.
 

oceanvps

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, but switched to the Hawaii Collection on Maui in 2009. Seems to me that everyone should get together on this matter and file a "class action lawsuit" against DRI.

in jan 2011 we bought points in the hawaii collection on maui, there was an additional piece of paper "special offer" at the end of all the signing of docs that said that we were exempt from paying special assessments for 2011 relating to the water intrusion problems at pop. we rescinded when we got home for various reasons but i think if we hadn't the way they worded the special offer would of meant that we would of been on the hook for the special assessment in 2012. convenient how they made the s.a. for 2012 imo.
 

T_R_Oglodyte

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Seems to me that everyone should get together on this matter and file a "class action lawsuit" against DRI.
What specifically would you allege that DRI has done?
Bear in mind that DRI is not assessing the owners anything. The assessment is being imposed by the Homeowners Association at the Resort, which is elected by the deedholders at the resort.

Current breakdown of resort ownership appears to be about 35% owned by the Hawaii Collection trust (the shares of which are voted by Trustee, which is not DRI), 11% is deeds held by DRI itself, and the remaining 56% is in the hands of individual deedholders.

****

So who, exactly, do you propose to sue and what would you allege as the basis for the suit?
 
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