ROFR is still alive..

[larryallen]

But I'm at the point now where I've heard too many reports on TUG of the closing companies playing their own games with ROFR paperwork. They falsely report the purchase prices in order to spur developers onto exercising it (thereby inflating the sellers' and their takes,) and in some cases the sellers/buyers don't know it's been done until all the paperwork has been filed. The more reports like this that we hear, the more it occurs to me that it's useless to report and track ROFR unless the only ones used for tracking are the ones where the actual developer-signed ROFR waivers or claims are seen with your own eyes.

I find this really hard to believe. I can't imagine any reputable, or semi-reputable, company would falsify documents in small time transactions like that. I just don't see it. Maybe this has happened once but I don't think it's the norm to have a title company falsifying closing prices.

 

[larryallen]

Purely anecdotal, but I have chosen not to bid on timeshares I thought for sure would be ROFR'd. It just seemed like a waste of my time. IMO, when it's exercised randomly, ROFR simply favors the developer/management company, allowing them to cherry-pick prime units at low prices to sell to their retail buyers.

I am sure you are not alone in this thinking but how much time could one really waste? Plus, they exericse on well less than 1% (approaching 0%) so I just can't imagine even giving it a moment's thought. In the highly unlikely event you get ROFR'd then at least you know you were buying at a good price, you find another and you try again.

 

[SueDonJ]

I find this really hard to believe. I can't imagine any reputable, or semi-reputable, company would falsify documents in small time transactions like that. I just don't see it. Maybe this has happened once but I don't think it's the norm to have a title company falsifying closing prices.

Here's a recent thread where a TUGger was told by the closing company (Timeshare Closing Services) that it's "the way they do business." Check out Post #27 in particular.

This is the first time that I can remember seeing a company admit to the practice, but there have been a number of threads on TUG over the years which mention it occurring.

 

[Steve]

I find this really hard to believe. I can't imagine any reputable, or semi-reputable, company would falsify documents in small time transactions like that. I just don't see it. Maybe this has happened once but I don't think it's the norm to have a title company falsifying closing prices.

Believe it or not as you wish, but it just happened to me. Based on my conversations with the title company, I'm quite sure that it wasn't a rare exception.

Steve

 

[JudyS]

I find this really hard to believe. I can't imagine any reputable, or semi-reputable, company would falsify documents in small time transactions like that. I just don't see it. Maybe this has happened once but I don't think it's the norm to have a title company falsifying closing prices.

I really don't know how often companies falsify ROFR documents. But, I would point out that many of the timeshare sellers on eBay are PCCs, which aren't known for their ethics. The "title companies" these eBay sellers use may not be real title companies, but just another branch of the PCC.

Regarding the very low priced Manor Club Platinum weeks on eBay, do we have any way to know if these sales actually passed ROFR? (Assuming Marriott was even informed of the actual selling price.) Has anyone here bought one of these eBay Manor Club Platinum weeks lately?

Also, does anyone think there is any chance Marriott would ROFR a Gold season property? Or, are Platinum (or equivalent) season weeks the only ones facing the possibility (however slight) of ROFR?

 

[EKniager]

I am sure you are not alone in this thinking but how much time could one really waste? Plus, they exericse on well less than 1% (approaching 0%) so I just can't imagine even giving it a moment's thought. In the highly unlikely event you get ROFR'd then at least you know you were buying at a good price, you find another and you try again.

I totally agree with you!

 

[yumdrey]

I believe there are many owners who know about false ROFR price for their newly purchased weeks. When they get deed, they can see the prices on it.
Even if they see $8000 on the deed, who cares? They actually paid only $500 - $1000 and the weeks are theirs already.
And many of them just don't say anything to public because their prices are very low and satisfied for the result.
TUG members are talking about ethics, but many ebay people seek for great opportunity to buy brand name resort for bottom low prices.
So those pcc sellers, in-house closing co and bargain deal seekers are perfect team.

I too, got a fake contract from TCS months ago for a Hilton week.
I cancelled my purchase because I didn't want to be a part of that fraud and didn't want anything to happen to my existing Hilton account.
But Steve and I are only a few who complained about it.
Many others will be quiet and keep buying weeks from them.

 

[Fredm]

Folks, you are not devious enough.

Think about it.

If the sale price is altered (for ROFR purposes) by a PCC, it is because they don't want it exercised.

PCC's usually transact the deal with a Power of Attorney. They do not actually own the timeshare.
If Marriott exercises the ROFR, the sale proceeds go directly to Marriott's owner of record. NOT to the PCC.
Marriott does not use the "closing company" that submitted the transaction for review.

The PCC (and their "closing agent") want to avoid this possibility at all costs.
Not only do they not get the money from the sale, the real owner finds out they did not actually surrender the deed when they forked over the money to be rid of it.
Some of them may not take kindly to being duped, after forking over a few thousand.

So, the "closing company" inflates the sale price. If a buyer inquires about it (as Steve did), they are told it was done in their best interest, to protect their purchase.
Isn't that considerate of them?

Now, if the seller is indeed the actual owner then the price may be inflated in the hope of having it exercised at the higher price. But, that does not appear to be the case most often.

I don't know the specifics of Steve's transaction. But, I am guessing the seller was a PCC.

 

[timeos2]

The whole idea of ROFR is a rip off. The fact that it leads to questionable efforts to avoid or override it is just another of many downsides. Best to avoid any dealing with it by simply saying NO to any resort / system that has it. There are plenty out there that are as good or better so why mess with it? Or, in the alternative if you MUST have resort X do whatever it takes to get a true market price & ignore the ROFR and any games involved. It's the closing company taking the risk as long as you aren't asking them to do it.

The whole mess is a big nightmare. Why anyone wants to become involved in any way is a mystery to me.

 

[richardm]

Well said, Fred. Very few things are as one-sided as a postcard company transaction.

 

[rrlongwell]

A perfect example of "shrinking the buyer pool". This leads to a lack of and lower offers than a free market would likely bring. Thank you for posting.

And possably increased prices for the older contracts that do not have right of first refusal. The cherry picking rational is exactly what the ROFR was designed to do. If you are a small seller you may not have access to the market to get a good price. They holder of the ROFR then gets it at what is basically a whole sale price to then resell at a higher price.

 

[ada903]

Fred, good to see you!

Today I got news that I passed ROFR on an very well priced Newport Coast platinum week (below ebay bottom pricing).

 

[windje2000]

+1

Fred, good to see you!

 

[kjd]

I'm probably missing something here but where's the harm in all of this ROFR business? Obviously, it's the buyer who is somewhat harmed if the property is ROFR'ed away. As long as the deposit is refunded promptly the ROFR'ed buyer is free to continue looking for another property. All they lost was time but may have learned more to make a better deal next time. The seller isn't harmed because they have a guaranteed sale no matter what happens. The title company is going to collect their fees whether ROFR is used or not. They are not harmed either.

The discussion here is more pointed at business ethics and the value of reported information. While most would agree that transparancy is valuable the fact is that ROFR is always at the front end of each transaction and has very little to do with the buyer or the seller after ROFR is either waived or implemented. It also has very little to do with true market pricing IMO.

The ethical questions are another matter. I find that I do not like to do business with dishonest people even if they treat me with integrety and someone else not. Unfortunately, the timeshare industry seems to attract the ethically challenged.

 

[mamadot]

Just attended a sales presentation at Ko Olina. They are using ROFR to buy back units to convert to pts. It's all about the TRUST points now!

 

[TheTimeTraveler]

Just attended a sales presentation at Ko Olina. They are using ROFR to buy back units to convert to pts. It's all about the TRUST points now!

I'm not sure why they would be using ROFR on weeks when they have a brand new building that offers plenty of unsold Destination Points....

Was the salesperson believable




.

 

[yumdrey]

Just attended a sales presentation at Ko Olina. They are using ROFR to buy back units to convert to pts. It's all about the TRUST points now!

I don't believe this 100%.

 

[Bogey1]

Here's a recent thread where a TUGger was told by the closing company (Timeshare Closing Services) that it's "the way they do business." Check out Post #27 in particular.

This is the first time that I can remember seeing a company admit to the practice, but there have been a number of threads on TUG over the years which mention it occurring.

I used Tmeshare Closing Services several years ago after I found a buyer for a Maui week. After the deposit and contracts were signed, they notified the buyer and myself that Marriott was going to take the unit. I asked to see the correspondence from Marriott. Timeshare Closing service delayed sending it to me for some time. When I finally received the copy, it said that Marriott was NOT going to take it. While filled with legalese, it's only a one page document!! Of course, the buyer had moved on to purchase elsewhere.

The closing service offered nothing other than to put it on ebay for a fraction of the price. Eventually I found another buyer myself and they agreed to not charge for the closing, but it was a lousy experience. Personally, I would never, ever use Timeshare Closing services again.

 

[Fredm]

Adriana and Windje2000,

Thank you! Nice to be missed.

 

[taffy19]

Isn't it possible for the sellers to contact the Marriott direct and ask them to send them the ROFR document that is required for this? This way, you know that it is filled out correctly.

After that is done, open an escrow with a Hawaiian Company. I believe that this is a requirement now even if you sell it FSBO. Am I correct?

 

[Fredm]

Isn't it possible for the sellers to contact the Marriott direct and ask them to send them the ROFR document that is required for this? This way, you know that it is filled out correctly.

All Marriott needs is the signed and accepted Purchase Contract between buyer and seller. The contract must specify the deeded unit and week number.

After that is done, open an escrow with a Hawaiian Company. I believe that this is a requirement now even if you sell it FSBO. Am I correct?

Correct. If money is changing hands, a Hawaii timeshare must have funds placed with a licensed Hawaii escrow agent.

 

[mamadot]

I should have said some Marriott properties. Not at Ko Olina.

 

[bdh]

I'm probably missing something here but where's the harm in all of this ROFR business? Obviously, it's the buyer who is somewhat harmed if the property is ROFR'ed away. As long as the deposit is refunded promptly the ROFR'ed buyer is free to continue looking for another property. All they lost was time but may have learned more to make a better deal next time. The seller isn't harmed because they have a guaranteed sale no matter what happens. The title company is going to collect their fees whether ROFR is used or not. They are not harmed either.

While logical; if everyone looked that way, alot of the TUG world would having nothing to debate - but time and time again, the dead horse is beaten here on TUG.

 

[Ddaley]

Rofr is being exercised

Hi All,

I have tried to purchase week a Whaiohai week 51 fixed (twice) and a floating week 1 to 51 (once) this year only to have Marriott exercise ROFR. I understand that this is because the only inventory the trust owns in Hawaii for weeks 51 and 52 is Kauai Lagooons which has only a very small beach area.

Thought this might be of interest.

Denise

 

[taffy19]

How interesting but the Waiohai was almost sold out completely so that makes sense.

There is a TUGger here (dioxide45) who is maintaining a database of all the Marriott resorts where the Marriott exercised their right to buy the timeshare so they are the buyer at the end. Most TUGgers will add this information here if Marriott exercised this right.

Here is the website and you may want to fill it out as the more people fill it out, the better the database is.