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A timeshare is a vacation property owned by multiple parties, who are each entitled to use of the property for a period of time. A timeshare property is often part of a resort (or family of resorts) and owners either prepay or finance a lump sum upfront plus annual maintenance fees. If you want to stay somewhere different than you originally paid for, upgrade or exchange fees may be charged. Typically, owners reserve a yearly trip to the property, usually one week in length.
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Frequently Asked Questions (FAQs)
How do timeshare points work?
For example, if you want to spend a week at a ski resort in Vail, Colorado, every winter, and that week cost 240 points, then you’d buy 240 points. If each point costs $20, then your timeshare will cost $4,800. If you want to spend a three-day weekend in Branson, Missouri, every other year, you may only need to buy 60 points.
Your points will replenish every year. You may also be able to bank points for future years or borrow points from future years. You also won’t be locked into traveling at the same time each year. If you decide to go to Vail in the offseason, or for less than a week, you might only spend 160 points. You would then have an extra 80 points to use the following year.
How can I get timeshare financing?
You can finance timeshares through the timeshare company, a personal loan, a credit card or a home equity loan. You can’t get a traditional first mortgage to buy a timeshare like you would to buy a house. A timeshare doesn’t actually give you ownership of real estate, and a first mortgage must be secured by the property it’s financing.
How long do timeshares last?
A timeshare with an in-perpetuity clause in the contract lasts for the owner’s lifetime and may be passed down to the owner’s heirs. A right-to-use timeshare will expire after a certain number of years, but the length may still be several decades.
What happens if you walk away from a timeshare?
Unfortunately, you can’t get rid of a timeshare by refusing to pay your annual dues. The timeshare company can report your unpaid dues to the credit agencies and even sue you. They can also foreclose if you own a deeded timeshare, or if you owe them money for a loan on your timeshare. In other words, you’ll end up owing more money and dealing with more headaches, plus it will damage your credit score.
If you hire a timeshare exit company and they instruct you to stop paying your annual dues, don’t do it, and consider reporting the company to your state consumer protection agency.
Can you give a timeshare back to the resort?
It depends on the resort and the terms of your timeshare contract. Wyndham, which is behind several timeshare companies, says timeshare owners can return their ownership to the company.
If you can’t give your timeshare back, you may be able to return your timeshare to the resort through its repurchase program, if it has one. You may also be able to sell it to a third party. Be aware that you may incur hundreds of dollars in fees and commissions to sell your timeshare.
Your timeshare contract may specify that the timeshare company must get the first opportunity to buy your timeshare before you make it available to the broader market. This opportunity is called the “right of first refusal.”