In a tough economy, struggling families look for ways to reduce their expenses. One popular option is to unload any timeshares so they can recoup their investment and stop paying maintenance fees. Many businesses specialize in reselling timeshares, but Better Business Bureau warns that some companies are using deceptive sales tactics to bilk thousands from already cash-strapped timeshare owners.
While timeshare owners are looking to unload the financial burden, unfortunately, not as many vacationers are buying. Timeshare sales dropped 40 percent in 2009, according to the American Resort Development Association. As a result, timeshare owners who are eager to sell are increasingly susceptible to offers that are too good to be true.
“Because of the economy, many timeshare owners want to cash out now but no one is buying,” said Alison Southwick BBB spokesperson. “Unfortunately, some unscrupulous timeshare resellers are taking advantage of the situation by misleading timeshare owners into paying thousands of dollars in the hopes of unloading their timeshare quickly.”
Companies like Resorts Condo Management, Creative Vacation Solutions, Platinum Property Exchange and Premier Timeshare Solutions have earned F ratings with BBB for convincing timeshare owners that they already have interested buyers but require thousands of dollars in upfront fees—such as closing costs—from the sellers and ultimately fail to complete the promised sale.
One man from Lincoln, Nebraska, who complained to BBB was promised by PTS that the business had a buyer for his timeshares, but if the sales did not go through, he would get his money back. He paid PTS a total of $7,710. The sale never went through and he never got his money back, despite the guarantee from the company.
BBB offers the following advice to timeshare owners who are looking for help in selling their timeshare:
- Use a Business You can Trust – Make sure the timeshare reseller you use is a BBB Accredited Business or at the very least has a good rating with BBB. You can check out a business’s BBB Reliability Report at bbb.org.
- Confirm Licensing Requirements – Some timeshare resellers will use fake addresses or PO boxes in order to mislead timeshare owners. Confirm where the company is located and in what states it does business. Ask if the company's salespeople are licensed to sell real estate where your timeshare is located. If so, verify this with the state licensing board.
- Get the Facts on the Figures – Find out if the business charges a commission. Do they handle the entire closing and provide escrow services? Do they charge an up-front listing or advertising fee? What does it cover and is it refundable?
- Be Wary of Upfront Fees – Many complainants to BBB were burned by companies charging an advance "appraisal" fee for services or were told that they just had to pay closing costs and the timeshare would be taken off their hands. Consider opting for a company that offers to sell for a fee only after the timeshare is sold.
- Don’t Fall for the Hard Sell or an Offer that Sounds Too Good to Be True – Don’t agree to anything over the phone but instead ask the salesperson to send you written materials; take the time to think it over and don’t be pressured. Unscrupulous timeshare resellers may claim that your property is in demand and they can sell it immediately; unfortunately, these promises are often empty.
For more advice you can trust on how to stretch your dollar in a tough economy, visit bbb.org.