Unpaid Maintenance Fees

[Peace08]

I heard the quickest way to get rid of your timeshare is to NOT paid the maintenance fees. Is this true and are there any repercussions for not paying maintenance fees just let it go into foreclosure?

 

[vacationhopeful]

Getting your social security number and DINGING the crap out of your credit report for a foreclosed deed plus MFs, plus late charges, plus legal fees, resulting in HIGHER credit card interest rates, higher loan i rates for cars and houses (if you get any loans as this is still considered as REAL ESTATE, etc.

Consider the 'source' of your info .. bartender?, person living with Mom at age 40+?, internet chat room?

 

[chalee94]

not true.

the best way to get rid of it is to have the developer agree to take back the deed.

the alternative (which may take a little longer and be a little more complicated) is to find someone to buy or take it from you. you may be able to give it away or sell it on ebay for $1.

if you welch on your obligation to pay maintenance fees, you are primarily hurting other owners and you will most likely take a credit hit (which may or may not bother you, but if you are looking to get a credit card or buy a car/house on credit, those things will be a lot more difficult...)

 

[jme]

Bad advice!!!

Really bad advice!!!!!

not true, and will hurt you further. Same as not paying your home mortgage payments. not sure how people don't realize this, but what you heard is faulty, and someone will come after you, hurting your credit.

It's real estate and someone is owed the money, "reasons" are irrelevant. That's the reality, so address it with the proper respect. There are better ways to get rid of it, but same goes for a house or anything for which monetary debt is owed. good luck, but don't take THAT chance...... and Happy Holidays

 

[Phydeaux]

Of those that are suggesting credit dings, bad things will happen, etc., are you speaking from first-hand accounts? Can you provide an example or two, of people you know personally that had their credit dinged?

Please, no hairdressers-sisters-neighbors - aunt stories. Not making light - just want to consider the source.

 

[raygo123]

Good point. If you're talking about I personally know, no.
The only way to know for sure is to ask your bank or a bankruptcy attorney. Your asking people, who are well educated on the subject, but it is the internet. You want the comfort of absolutely, positively knowing, in your mind spend the money on the lawyer.

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[theo]

Nope...

I heard the quickest way to get rid of your timeshare is to NOT pay the maintenance fees. Is this true and are there any repercussions for not paying maintenance fees just let it go into foreclosure?

As already stated by others, what you have reportedly "heard" is simply and categorically neither true nor remotely accurate.

For starters, a resort may very well let you build up several years of maintenance fees bills (plus interest and late charges) before finally deciding to foreclose.
Ain't nuthin' "quick" about several years, wouldn't you agree? You probably wouldn't enjoy all the collection agency calls in the meantime either.

"Repercussions" have also already been addressed by others, with a trashed credit rating perhaps being foremost among them.

 

[arlock]

Do resort developers pay maintenance fees on unsold units? if they don't, not paying the maintenance fees is no different than deeding the unit back to the developer.

 

[raygo123]

Do resort developers pay maintenance fees on unsold units? if they don't, not paying the maintenance fees is no different than deeding the unit back to the developer.

Are you sure that the MF falls on developer, and not the HOA who must now build it into all other MFs?

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[Ty1on]

I heard the quickest way to get rid of your timeshare is to NOT paid the maintenance fees. Is this true and are there any repercussions for not paying maintenance fees just let it go into foreclosure?

What's the timeshare, and are fees currently delinquent?

 

[ace2000]

I heard the quickest way to get rid of your timeshare is to NOT paid the maintenance fees. Is this true and are there any repercussions for not paying maintenance fees just let it go into foreclosure?

The quickest way to get rid of your timeshare is to find someone else to buy it and to take your name off the deed, or check and see if the resort will allow you to deed it back to them. If you stop paying you're still going to "own" it at least for several more years until they choose to foreclose.

Are the maintenance fees all that you owe, or do you still owe on the purchase too? How far behind are you (if at all)? Those would have to be answered if you want the best advice from here.

 

[theo]

Calrifications seem to be in order here...

Do resort developers pay maintenance fees on unsold units? if they don't, not paying the maintenance fees is no different than deeding the unit back to the developer.

Huh? No disrespect intended, but your logic, assumptions and reasoning are badly flawed, legally speaking.

The OP did not actually identify in any way whether his / her "hypothetical" scenario involves a "chain" resort (i.e., one which is still in active developer sales), or whether it is perhaps instead a fully sold out, independent facility but, in either case, the distinction is irrelevant to the discussion at hand.

Developers "absorb" (but do not overtly pay out) maintenance fees on unsold weeks. At a fully sold out independent (i.e., non-"chain") resort, maintenance fees are also not overtly paid out by the HOA which now owns weeks retrieved via foreclosure. Instead, in the latter instance, all of the other remaining, fee-paying owners at said independent facility must then shoulder the shortfall created by those not paying their fees, in part by increases to their fees.

It's important to note that neither any developer nor any sold out independent resort is ever required to voluntarily accept a "deedback". The discussion and argument goes on and on in these TUG forums ad nauseam whether or not they should do so, but the indisputable fact remains that none are ever legally obligated to do so.
In point of fact, most don't, most won't --- and none ever have to do so.

 

[arlock]

I think some of you missed the boat, and no it's not an illogical statement. Chalee made the comment that the quickest solution was a deedback. She continued on to say that by not paying MF's you are hurting other owners.

If the developer isn't paying MF's on unsold, vacant units, how is there a difference, compared to an owner not paying on a vacant unused unit?

 

[DeniseM]

I think some of you missed the boat, and no it's not an illogical statement. Chalee made the comment that the quickest solution was a deedback. She continued on to say that by not paying MF's you are hurting other owners.

If the developer isn't paying MF's on unsold, vacant units, how is there a difference, compared to an owner not paying on a vacant unused unit?

I don't think you understand how this works:

Developer - the company that builds the resort, sells the units, and then leaves.

Management Company - the company that is hired to manage the resort at the direction of the HOA, as directed by the Board of Directors.

HOA - Owners - people like you and me, who own the resort, and pay the maintenance fees.

When someone defaults on a timeshare, it has NO impact on the developer.

Abandoned deeds go back to the HOA - and across the board, owners have higher maintenance fees, because they must cover the MF on the abandoned deeds.

It has NOTHING to do with the developer.

 

[SmithOp]

I think some of you missed the boat, and no it's not an illogical statement. Chalee made the comment that the quickest solution was a deedback. She continued on to say that by not paying MF's you are hurting other owners.



If the developer isn't paying MF's on unsold, vacant units, how is there a difference, compared to an owner not paying on a vacant unused unit?

The difference is that unsold units can be rented to cover fees.

The quickest way to deed back is to offer to pay a year or two of fees in advance, not paying is the longest way to a deed back.


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[Ty1on]

I don't think you understand how this works:

Developer - the company that builds the resort, sells the units, and then leaves.

Management Company - the company that is hired to manage the resort at the direction of the HOA, as directed by the Board of Directors.

HOA - Owners - people like you and me, who own the resort, and pay the maintenance fees.

When someone defaults on a timeshare, it has NO impact on the developer.

Abandoned deeds go back to the HOA - and across the board, owners have higher maintenance fees, because they must cover the MF on the abandoned deeds.

It has NOTHING to do with the developer.

Also, if the developer WANTS an interval to sell, they will buy it from the HOA. For drastically less than they will sell it for. A few bucks will go in the HOA coffers, and the developer will pay the delinquent MF when it takes the interval, but unless the HOA has a sales and marketing arm, they don't get retail profit from selling it.

 

[Phydeaux]

As already stated by others, what you have reportedly "heard" is simply and categorically neither true nor remotely accurate.

For starters, a resort may very well let you build up several years of maintenance fees bills (plus interest and late charges) before finally deciding to foreclose.
Ain't nuthin' "quick" about several years, wouldn't you agree? You probably wouldn't enjoy all the collection agency calls in the meantime either.

"Repercussions" have also already been addressed by others, with a trashed credit rating perhaps being foremost among them.

First, this is why I asked for 1st hand experiences, not what you may have heard. What first hand experiences do you have re. this subject?

Second, the op didn't mention the location of their ts. Would you anticipate collection calls from a ts in Mexico, for example?

Once again, looking for first hand experiences, not what you heard! Misinformation is a 2-way street folks! :annoyed:

 

[raygo123]

Also, if the developer WANTS an interval to sell, they will buy it from the HOA. For drastically less than they will sell it for. A few bucks will go in the HOA coffers, and the developer will pay the delinquent MF when it takes the interval, but unless the HOA has a sales and marketing arm, they don't get retail profit from selling it.

Does it matter if the HOA doesn't receive retail for it?
Receiving back MFs is most likely more than resale.

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[gmarine]

The easiest way is definitely to have the resort take the deed back from you or to sell/give it away. However, if the developer refuses to take the unit back and you have been unable to give it away then not paying the fees may be your only option. It MAY hurt your credit but this isnt a certainty. Not all timeshare companies will report delinquencies to the credit bureaus.

More than likely they will eventually give the debt to a collection agency which will contact you. You can avoid further contact with the collection agency by following the rules of the Fair Debt Collection Practices Act but the collection agency is still permitted to contact you under certain circumstances.

After not paying the fees for a time which will vary by resort, most resorts will offer to take the deed back from you rather than incur the expense of a foreclosure.

It will be a considerable amount of time from the point you stop paying your fees until the resort either takes the deed back or forecloses on the unit.

Dont stop paying maintenance fees because you think its the easiest way to get rid of it. Only stop paying for it if you have exhausted all other options.

 

[ace2000]

It's important to note that neither any developer nor any sold out independent resort is ever required to voluntarily accept a "deedback". The discussion and argument goes on and on in these TUG forums ad nauseam whether or not they should do so, but the indisputable fact remains that none are ever legally obligated to do so.
In point of fact, most don't, most won't --- and none ever have to do so.

LOL - I think you keep debating yourself on this issue. I have yet to see any one on TUG suggest that the resort is required or have to do so, or even legally obligated to take back the deed. Many suggest that they should do it as you mentioned, but that's a big difference in this ongoing debate you have with yourself.

 

[raygo123]

[Inappropriate comment deleted.]

 

[Ty1on]

[Quote of inappropriate comment deleted.]

 

[theo]

First, this is why I asked for 1st hand experiences, not what you may have heard. What first hand experiences do you have re. this subject?

Once again, looking for first hand experiences, not what you heard! Misinformation is a 2-way street folks! :annoyed:

My initial reply was to the actual OP in this thread --- I frankly did not even see your comment at all (I use the "ignore list" function in TUG's User CP options).

That observation aside, my first hand experience results from sitting on a timeshare BoD / HOA for several terms (including currently) and therefore being on the receiving and decision-making end of "deedback" requests (and sometimes, foreclosure initiation) at an independent (i.e., non-chain) timeshare long since out of developer hands.

I'm sorry if you do not find mine to be sufficient or credible "first hand experience". I thought (apparently mistakenly, in your view) that I had something to contribute to the conversation regarding OP's comment about the "quickest" exit being via nonpayment --- but I will defer to your apparently superior wisdom and "experience".

 

[Phydeaux]

My only first hand experience is that of sitting for several terms now on a timeshare BoD / HOA (including currently) and therefore being directly on the receiving and decision-making end of "deedback" requests (and sometimes foreclosure initiation) at an independent (i.e., non-chain) timeshare, long since out of developer hands.

I'm sorry if you do not find mine to be sufficient or credible "first hand experience". I thought (apparently mistakenly, in your view) that I had something to contribute to the conversation regarding OP's comment about the "quickest" exit being via nonpayment --- but I will defer to your apparently superior wisdom and experience.

Defensive much?

 

[Talent312]

Defensive much?

IMHO, not so much defensive as accurate, from the POV of a HOA-BOD trying to enforce MF's for the benefit of all other owners. It's not an easy task deciding what's in the best interest of the owner's as a group. Do you (1) let a delinquent owner off the hook with a deed-back, (2) turn him over to a collection agency, or (3) commence foreclosure proceedings -- all of which means (a) no MF from that owner and (b) more expenses for the HOA, which does what? Increase MF's for other owners. Who pays for that?

-- This isn't rocket science.

What the HOA-BOD cannot do is simply let it slide. That would be contrary to their fiducuary duties.

But it is also true that a foreclosure could have minimal consequences for a defaulting owner. Perhaps no one will refer the matter to a collection agency or notify the credit reporting agencies, no one will check for judgment liens, and a bank will rely on a credit report that overlooked it.

First hand experience: I had a brother who stopped paying a mortgage (and other bills) who we took in for a few months. The calls from collection agencies, certified letters, and other annoyances finally stopped... after about two and a half years. But who knows? It may not happen to you.
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