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Need to get relief from a timeshare account but don’t know what to do? Here’s how to get out of timeshare without hurting your credit score. Check here How to Get Out of Timeshare

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Expenses of Buying and Owning a Timeshare

In theory, when you buy a timeshare, you have a fractional interest in the property the rental is situated on. But it’s important to understand that this does not give you all the advantages that owning real estate normally has.

For starters, you have an interest in the same unit as other people who participate in the timeshare. Your interest, therefore, is not standalone ownership. You are not free to do with the unit as you please. For example, there are strict limits on the time during which you have physical occupancy of the unit. Unlike a true vacation home, you’re not able to rent it out during the rest of the year when you’re not occupying it for personal use. cancel timeshare contract sample letter http://www.timesharerelease.com/cancel-timeshare-contract-sample-letter-that-works

We can think of a timeshare as having a partial ownership interest in a single vacation property or unit. It’s nothing like owning a vacation property outright, with the benefits that come as a result of having it. According to the ARDA, timeshare owners are tending to be younger and more ethnically diverse than when the industry started and targeted an elderly crowd. The median age of recent buyers is 39, and 34% of owners are either Asian-American or African-American. Nearly two-thirds have college degrees. Their median income is $81,311. However, it seems to me that the timeshare market targets the financially inexperienced. Sadly, timeshares tend to become vacation properties for people who can’t afford vacation properties. The sales materials are made to appear more about the bling and “living the good life” than about the investment return. That’s because there is no return.

If you are spending money for the future, it should be considered an investment. If it’s not generating income, it’s an expense — plain and simple. You may get enjoyment out of it, but it’s still not an investment. cancel timeshare after rescission period http://www.timesharerelease.com/how-to-cancel-timeshare-after-rescission-period

Timeshares Aren’t Very Liquid

It’s usually only after you’ve purchased a timeshare that you realize there are more people looking to sell them than buy them. The likelihood of recovering your initial investment is very low — to say nothing of recovering many years’ worth of maintenance fees. There are websites that timeshare owners can use to try to sell their property, such as RedWeek, but they charge a listing fee and an annual membership fee to use the site — and there’s no guarantee the timeshare will sell.

And there’s a substantial amount of fraud in the reselling industry. Scammers prey on timeshare owners by promising to sell the property for you — for an upfront fee — and once you pay the fee, you never hear from them again.

If you’re able to sell the timeshare (and that is never certain), you probably will get only a fraction of what you paid for it. There are two fundamental problems when it comes to selling them:

1. More are being built/offered all the time, flooding the market, and 2. Existing owners are selling them to get out of debt or once they realize that it isn’t the deal they thought it was when they bought it. how to get rid of timeshare without ruining credit http://www.timesharerelease.com/how-to-get-out-of-timeshare

If you still think buying a timeshare is a good idea, and you want to avoid paying more than you will ever sell it for, buy one on the secondary market. There are many websites where you can buy a used timeshare.

Timeshare companies know that you can likely find cheaper options from existing buyers on websites such as Timeshare Users Group and RedWeek. So the companies usually offer closing incentives and other perks. But those perks don’t usually recoup the money you would save from buying from an existing owner.

The Better Alternative to a Timeshare

In my opinion, you’re better off staying at a local hotel than buying into a timeshare. Take my parents’ timeshare as an example. They paid $10,000 for the initial purchase, and if you add the $750-per-year maintenance fee paid over a 10-year timeframe, there is a total investment of $17,500 in that timeshare. cancel timeshare within 5 days http://www.timesharerelease.com/how-to-cancel-timeshare-after-rescission-period

Over the last 10 years, their timeshare provided a stay of one week each year — seven days and six nights — for a total of 60 nights, which averages out to $291 per night to vacation in the same unit each year. If you were to rent a decent quality hotel room at about $175 per night, the total price paid for the timeshare would buy you 100 nights of hotel stays. Not only does it cost less per night to stay in a hotel, but you would also be able to add variety to your vacation by staying at hotels located in different destinations.

And you would also be able to take advantage of frequent user rewards programs and other discount pricing being offered by the hotels. Chances are you’d get a whole lot more than 100 nights of hotel stays.

Best of all, you’d have sunk no capital in the timeshare, and the money to pay for the timeshare could be invested to earn a return on your investment. At a conservative 5% return compounded annually (starting with $10,000 and adding $750 per year), you’d be sitting on more than $26,000 right now. That’s a much better deal from where I sit.

Expenses of Buying and Owning a Timeshare

Although owning a timeshare means you won’t need to throw your money at rental accommodations each year, timeshares are by no means expense-free.

First, you will need a chunk of money for the purchase price. If you don’t have the full amount upfront, expect to pay high rates for financing the balance. Since timeshares rarely maintain their value, they won’t qualify for financing at most banks. timeshare cancellation letter sample http://www.timesharerelease.com/cancel-timeshare-contract-sample-letter-that-works

If you do find a bank that agrees to finance the timeshare purchase, the interest rate is sure to be high. Alternative financing through the developer is typically available, but again, only at steep interest rates. A timeshare owner must also pay annual maintenance fees (which typically cover expenses for the upkeep of the property). And these fees are due whether or not the owner uses the property. Even worse, these fees commonly escalate continuously; sometimes well beyond an affordable level.

You might recoup some of the expenses by renting your timeshare out during a year you don’t use it (if the rules governing your particular property allow it). However, you might need to pay a portion of the rent to the rental agent, or pay additional fees (such as cleaning or booking fees).

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What is the legal structure of timeshare?

What Is a Timeshare?

A timeshare is a way for a number of people to share ownership of a property, usually a vacation property such as a condominium unit within a resort area. Each buyer usually purchases a certain period of time in a particular unit. Timeshares typically divide the property into one- to two-week periods. If a buyer desires a longer time period, purchasing several consecutive timeshares may be an option (if available).

cancel timeshare contract sample letter http://www.timesharerelease.com/cancel-timeshare-contract-sample-letter-that-works

Fixed vs. Floating Weeks

Traditional timeshare properties typically sell a set week (or weeks) in a property. A buyer selects the dates he or she wants to spend there, and buys the right to use the property during those dates each year. Some timeshares offer “flexible” or “floating” weeks. This arrangement is less rigid, and allows a buyer to choose a week or weeks without a set date, but within a certain time period (or season). The owner is then entitled to reserve his or her week each year at any time during that time period (subject to availability).

For example, a buyer might purchase a week during “high season,” which entitles the buyer to reserve any week during the property’s designated busy, popular season each year. Since the high season might stretch from December through March, this gives the owner a bit of vacation flexibility.

Legal Structure of a Timeshare

What kind of property interest you’ll own if you buy a timeshare depends on the type of timeshare purchased. Timeshares are typically structured either as shared deeded ownership or shared leased ownership. cancel timeshare after rescission period http://www.timesharerelease.com/how-to-cancel-timeshare-after-rescission-period

Shared Deeded Ownership

With shared deeded ownership, each owner is granted a percentage of the real property itself, correlating to the amount of time purchased. The owner receives a deed for his or her percentage of the unit, specifying when the owner can use the property.

This means that with deeded ownership, many deeds are issued for each property. For example, a condominium unit sold in one-week timeshare increments will have 52 total deeds when fully sold, one issued to each partial owner.

Shared Leased Ownership Interest

If the timeshare is structured as a shared leased ownership, the developer retains deeded title to the property, and each owner holds a leased interest in the property. Each lease agreement entitles the owner to use a particular property each year for a set week, or a “floating” week during a set of dates. how to get rid of timeshare without ruining credit http://www.timesharerelease.com/how-to-get-out-of-timeshare

If you buy a leased ownership timeshare, your interest in the property typically expires after a certain term of years, or at the latest, upon your death. A leased ownership also typically restricts property transfers more than a deeded ownership interest. This means as an owner, you might be restricted from selling or otherwise transferring your timeshare to another. Due to these factors, a leased ownership interest might be purchased for a lower purchase price than a similar deeded timeshare.

Timeshare Exchange Programs

With either a leased or deeded type of timeshare structure, the owner buys the right to use one particular property. This can be limiting to someone who prefers to vacation in a variety of places.

To offer greater flexibility, many resort developments participate in exchange programs. Exchange programs enable timeshare owners to trade time in their own property for time in another participating property. For example, the owner of a week in January at a condominium unit in a beach resort might trade the property for a week in a condo at a ski resort this year, and for a week in a New York City accommodation the next.

Exchange clubs can involve some challenges however. Usually, owners are limited to choosing another property classified similar to their own. Plus, additional fees are common, and popular properties might be tricky to get. cancel timeshare within 5 days http://www.timesharerelease.com/how-to-cancel-timeshare-after-rescission-period

Expenses of Buying and Owning a Timeshare Although owning a timeshare means you won’t need to throw your money at rental accommodations each year, timeshares are by no means expense-free.

First, you will need a chunk of money for the purchase price. If you don’t have the full amount upfront, expect to pay high rates for financing the balance. Since timeshares rarely maintain their value, they won’t qualify for financing at most banks.

If you do find a bank that agrees to finance the timeshare purchase, the interest rate is sure to be high. Alternative financing through the developer is typically available, but again, only at steep interest rates. A timeshare owner must also pay annual maintenance fees (which typically cover expenses for the upkeep of the property). And these fees are due whether or not the owner uses the property. Even worse, these fees commonly escalate continuously; sometimes well beyond an affordable level.

You might recoup some of the expenses by renting your timeshare out during a year you don’t use it (if the rules governing your particular property allow it). However, you might need to pay a portion of the rent to the rental agent, or pay additional fees (such as cleaning or booking fees).

Benefits of Owning a Timeshare

There are a variety of reasons why timeshares can work well as a vacation option. If you vacation at the same resort each year for the same one- to two-week period, a timeshare might be a great way to own a property you love, without incurring the high costs of owning your own home. (For details on the costs of resort home ownership see Budgeting to Buy a Resort Home? Expenses Not to Overlook.) timeshare cancellation letter sample http://www.timesharerelease.com/cancel-timeshare-contract-sample-letter-that-works

Timeshares can also bring the comfort of knowing just what you’ll get each year, without the hassle of reserving and renting accommodations, and without the fear that your favorite place to stay won’t be available. Additionally, some timeshares offer perks such as the right to use fitness rooms and hot tubs. Some even offer on-site storage, allowing you to conveniently stash equipment such as your surfboard or snowboard, avoiding the hassle and expense of carting them back and forth.

And just because you might not use the timeshare every year does not mean you can’t enjoy owning it. Many owners enjoy periodically loaning out their weeks to friends or relatives. Some owners might even donate the timeshare week(s), as an auction item at a charity benefit for example.

If you don’t want to vacation at the same time each year, flexible or floating dates provide a nice option. And if you’d like to branch out and explore, consider using the property’s exchange program (make sure a good exchange program is offered before you buy).

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How to decide timeshare is a smart move for you?

Love taking your annual vacations? Then you might consider investing in a timeshare, a vacation property that you share with others and get to visit certain times of the year. But is buying such a property a good move?

That depends on your goals.

If you expect to one day earn a profit when you sell your vacation property, then a timeshare is not a smart choice. These properties rarely increase in value, and it can be difficult to find a seller willing to pay top dollar for them. But if you prefer a fixed vacation spot in a location that you know you’d like to visit each year? Then a timeshare might work. More about timeshare : http://www.timesharerelease.com

The key to deciding whether a timeshare is a smart move for you is to carefully consider your own vacation habits. Timeshares aren’t a good choice for those who like traveling to different cities and countries each year but might work for those who prefer vacationing in the same spot on an annual basis.

Just be sure to remember that a timeshare, no matter how much you enjoy it, will never bring a financial windfall when it’s time to sell. “A timeshare can be a nice way to travel, but it should never be confused with an investment,” said Gordon Newton, author of the Consumers Guide to Timeshare Exit and president of Newton Group Transfers in Chandler, Arizona. “It will not increase in value and always has a maintenance fee attached to it.”

How Timeshares Work

As the name suggests, when you buy a timeshare, you are purchasing a vacation property that you share with others throughout the year. In many timeshare arrangements, you get to visit your vacation property once a year.

When you get to visit it depends on the type of timeshare you purchase.

You might purchase a fixed-week timeshare. With this arrangement, you can visit your timeshare property during the same week every year for as long as your contract allows. This type of timeshare provides predictability and makes it easy to plan your trip. You might, though, get bored traveling to the same vacation property during the same week every year.

If you don’t feel like traveling during a given year you can try to rent out your block of time to other travelers. You can also switch times with other owners. Of course, this works best when you own a timeshare in a popular location. How To Get Out of Paying Your Timeshare Maintenance Fees? http://www.timesharerelease.com/how-to-get-out-of-paying-your-timeshare-maintenance-fees

Floating timeshares are a bit different. In this arrangement, you can reserve your property any week during a certain time period. Maybe you can visit your timeshare sometime during the months of July, August or September, for instance. Not surprisingly, it’ll cost more to reserve time during the more popular traveling months of the year. Another option is the points system. This arrangement is more complicated: You can stay at different timeshare properties, but the properties and times available to you depend on the number of points you’ve accumulated. You get points by buying into a timeshare or by purchasing them from the vacation club of which you are a member. You can buy a timeshare directly from a vacation club offering them or from current owners trying to sell their properties. Buying from an individual owner is often a better bargain.

The Pros and Cons

Newton works with consumers to help them get rid of unwanted timeshares. He said that consumers should never consider timeshares to be a financial investment. Timeshare 101: How To Sell Bluegreen Property http://www.timesharerelease.com/timeshare-101-how-to-sell-bluegreen-property

Why? Because most consumers won’t be able to sell a timeshare they no longer want and make a profit, Newton said. Timeshares also come with maintenance fees, something that will eat away at any potential profit owners might make when they eventually sell their timeshares. Those maintenance fees are a big negative. Newton said that owners usually pay these fees each year. These fees usually increase annually, too, usually at a rate higher than inflation, he added. This doesn’t mean, though, that a timeshare is always a bad move. Those consumers who understand that a timeshare will cost them money and not make them any, might enjoy having a guaranteed vacation spot each year, Newton said. This is especially true if the timeshare is a nicely maintained property in a desirable location. The downside here? You might grow tired of vacationing in the same location each year. That’s when the challenge of a timeshare – getting rid of one – kicks in. You might have to pay a third party to help you get out of a timeshare arrangement if you can’t find someone to buy your property. How To Cancel A Vacation Club Contract http://www.timesharerelease.com/how-to-cancel-a-vacation-club-contract

“When they are no longer interested in traveling to that location, they will have to deal with the burden of getting out of the timeshare, which could cost money if an exit company or attorney is required,” Newton said. “Sometimes you just can’t find a buyer, and the resorts typically won’t take it back.”

Another challenge with timeshares? You might struggle to book a vacation at your location during popular weeks. You could avoid this by purchasing a fixed-week timeshare, where your vacation time is guaranteed each year. But if you don’t have one of these, you might struggle to book your location during popular times such as the height of the summer or during spring break weeks.

Newton said that timeshares often come with unexpected costs. The resort operating your timeshare might need to issue a special assessment for repairs such as replacing old roofs or upgrading a community pool. As an owner, you’ll have to contribute to this assessment, which could put an unexpected hit on your budget.

Hunt for Bargains

Paul Moyer, founder of the SavingFreak.com blog, doesn’t recommend that anyone buy a timeshare directly from a resort operator. Owners rarely make any money when they decide to sell such properties, he said. Buyers can usually purchase a timeshare at a much lower cost from the owners of used ones, Moyer said.

“Buying a timeshare directly is never worth the cost,” Moyer said. “There are so many people who are looking to sell their timeshares on the secondary market. Prices for these used timeshares can be as little as 10% of the cost of buying directly from the source.”

Not everyone who owns timeshares feels burned by the experience, though. Kari Lorz, founder of the Money for the Mamas personal finance blog, said that she and her husband purchased a timeshare in 2016. Before they bought, though, they did their research. The main factors they considered? Will they use the timeshare often and what will happen when they decide to sell it? What Is Timeshare Lease And How Can Owners Benefit From It http://www.timesharerelease.com/what-is-timeshare-lease-and-how-can-owners-benefit-from-it

After doing their research, Lorz and her husband invested in a timeshare arrangement through Disney Vacation Club. Through the club, Lorz can vacation at any of 11 properties at locations such as Disneyland; Hilton Head, South Carolina; or Vero Beach, Florida. All of these locations are attractive ones for Lorz.

Disneyland Vacation Club timeshares are also in demand, Lorz said. She said that if she and her husband sold today, they could make a 35% return on their purchase price. Lorz said, too, that she and her family have saved a significant amount of travel costs thanks to the timeshare.

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Why timeshare is not a good idea for everyone?

A timeshare is an ownership model in which many customers own allotments of usage in the same property. The timeshare model can apply to many different types of properties, such as condominiums, homes, campgrounds, vacation resorts, recreational vehicles, and private jets.

BREAKING DOWN Timeshare

With opportunities to rent allotted time each year and sell timeshare interests in the future, many owners of vacation timeshares look at purchasing as an investment. However, this view is frequently misguided. More about timeshare : http://www.timesharerelease.com

The advantages of a timeshare vacation property often include larger accommodations and a feel of being at home, but timeshares are not a good idea for everyone. In fact, the timeshare market is rife with gray areas and questionable business practices; so, it is vital that prospective customers practice due diligence before buying. The best timeshare investment opportunities tend to be in the resale market rather than in the market created by property developers.

4 Types of Timeshares

First, a little background about the four types of timeshares: 1. Fixed Week The buyer usually owns the rights to a specific unit in the same week, year in and year out, for as long as the contract stipulates. There is predictability, but also little flexibility and the potential for long-range boredom.

With a fixed-rate timeshare, the owner can rent out his block of time or trade with owners of other properties. This type of arrangement works best if you have a highly desirable location.

2. Floating The buyer can reserve his own time during a given period of the year. This option has more freedom than the fixed week version, but getting the exact time you want may be difficult when other shareholders snap up many of the prime periods. How To Get Out of Paying Your Timeshare Maintenance Fees? http://www.timesharerelease.com/how-to-get-out-of-paying-your-timeshare-maintenance-fees

3. Right-To-Use With this arrangement, the buyer leases the property for a given amount of time each year for a set amount of years. The developer maintains ownership of the property, however.

4. Points Club This is similar to the floating timeshare, but buyers can stay at various locales depending on the amount of points they’ve accumulated from buying into a specific property or purchasing points from the club. The points are used like currency and timeslots at the property are reserved on a first-come basis.

Disadvantages of Timeshares

Many timeshare acquisitions are impulsive and emotional purchases. For example, Las Vegas is filled with timeshare marketers who entice customers to listen to an off-site timeshare presentation. In exchange for listening to their pitch, they offer incentives, such as free event tickets and complimentary hotel accommodations. The salespeople work for property developers and frequently employ high-pressure sales approaches designed to turn "nays" into "yeas." The prices developers charge are significantly more than what a buyer could realize in the secondary market, with the developer surplus paying commissions and marketing costs. Also, timeshare marketers may conceal the actual cost of timeshare ownership and exaggerate its potential benefits. Timeshare 101: How To Sell Bluegreen Property http://www.timesharerelease.com/timeshare-101-how-to-sell-bluegreen-property Even if a timeshare owner knows the full costs and true nature of timeshare benefits, a few disadvantages remain. For instance, timeshares depreciate quickly. Maintenance fees can rise every year, to the point that timeshare owners decide to sell their allotments rather than continue paying fees. The American Resort Development Association advised that the average annual maintenance fee for a timeshare is $700, which does not include the timeshare purchase price.  The association also estimates that fees will increase 8% on average annually.

4 Disadvantages of Timeshares

1. While you don’t need to worry about maintenance, you will need to worry about the annual fees and your lack of control over their annual increases. The average annual maintenance fee for a timeshare is $660, according to Howard Nusbaum, CEO and president of the American Resort Development Association. You pay that fee whether you use the property or not. In addition, you could be liable for special assessments.  If you don’t pay up, the developer can foreclose on your timeshare. How To Cancel A Vacation Club Contract http://www.timesharerelease.com/how-to-cancel-a-vacation-club-contract

2. Timeshares are hard to sell, and used timeshare units are sold at a steep discount because there are so many on the market.  Thus, it might be a better deal to buy a used timeshare on the secondary market. Bear in mind that the Better Business Bureau has been warning about timeshare reselling schemes that defrauded victims out of thousands of dollars.

3. If you sell your timeshare at a loss, the Internal Revenue Service doesn’t let you claim a capital loss as you would with other investments and real property.

4. Buying a timeshare in a foreign country presents special challenges. In Mexico, for example, foreigners are not allowed to hold the direct title to property within 30 miles of the coast and 60 miles of international borders. They are limited to “right to use” timeshares.  (There is pending legislation in the Mexican Congress that may change that in the near future.) Also, consumer protection laws in some countries are more lax and lack enforcement.

Advantages of Timeshares

Despite the disadvantages, some people enjoy owning a timeshare property. They are especially beneficial for people who like vacationing in the same place every year and who are patient enough to wait a year or more, if necessary, to make a timeshare exchange to vacation elsewhere. Such a wait is typical when there is a mismatch between supply and demand. For example, someone with a timeshare in Myrtle Beach, South Carolina, would encounter difficulty making an exchange for a week's stay at a Paris timeshare. The owner of the Paris timeshare would have to agree to an exchange for a stay in Myrtle Beach. The unbalance of demand makes it difficult to execute a trade.

5 Advantages of Timeshares

1. Unlike a vacation home which may be vacant part of the year, you only pay for what you use. Thus, the use of a very expensive property could be more affordable; for one thing you don’t need to worry about year-round maintenance. What Is Timeshare Lease And How Can Owners Benefit From It http://www.timesharerelease.com/what-is-timeshare-lease-and-how-can-owners-benefit-from-it

2. If you like predictability, you have a guaranteed vacation destination.

3. You may be able to trade times and locations with other owners, allowing you to travel to new places.

4. You may be able to rent out your block of time if you can’t use it, although some timeshare contracts may not permit this and website exchange services may charge you to play matchmaker.

5. You might enjoy letting your friends or family use their timeshare for free or offer it at a charity auction.