Timeshare Trap

Timeshares are one of the worst investments you can make. This journal is to inform people who are thinking about purchasing a timeshare not to do so and help those trying to get rid of their timeshare.

Friday, March 23, 2007

Another Time Share Scam

When making an investment, you need to always be sure you know exactly what that investment is. It's also important to never forget that time shares should no be considered investments:

Missouri Secretary of State Robin Carnahan’s office issued cease and desist orders against four Missouri men, including a former Raymore insurance agent, two Mexican firms, a Panamanian business and a Nevada promoter for allegedly bilking more than three-dozen state residents.

The Missouri investors, ranging in age from 64 to 86, each pumped at least $5,000 into what sounded like a great deal promising a 9 percent to 11 percent return for 25 years.

Only after investing a combined $1.8 million did the investors learn they were buying into timeshares in Cancun, Mexico. The only way they could make money was to rent out their timeshare units...
Entire Article

Wednesday, March 21, 2007

Escaping The Time Share Trap

An email received from one person who was able to escape the time share trap by donating it to charity. It gives a look into the process and what you might expect if you decide on this route:

It's been almost a year to the date since our last email exchange, but after many months, my wife and I are finally FREE of our timeshare!!!

My wife and I looked into the Quit Claim Deed process and after further investigation, we decided we knew much too little about real estate law so, we agreed donating our timeshare was the best process for us to relieve ourselves of it! At the suggestion of your website I contacted Gifts For Sight. I received an email back and eventually everything they said in their emails and on their website
(www.giftsforsight.org/timeshare) happened just as they said it would. (FYI, Gifts for Sight also has another website www.itsdonated.com).

In May 2006, I submitted all the paperwork as they requested on the website and received prompt acknowledgment of my submittal. A month later, about mid June, I received notice that they had "begun the selling process" of my timeshare. The second of July, I received another email saying my timeshare had been sold and my information would be sent to their closing company, JRA Services in Sunrise Florida. They gave me contact information for that company. About a week later JRA Services sent me additional forms to complete and they also requested a copy of my recorded deed which I faxed to them. About a month later (second week of August), they sent me new deed to be sign and notarized. My wife and I filled that out and returned it.

Then came the waiting...

I contacted either the Gifts For Sight and JRA Services once a month until December when I thought it was going to fall through. The problem was with the buyers failing to return the paperwork. Gifts for Sight had to get involved again to "light a fire" under the buyers in late December and then on Jan. 5, I received an email from JRA Services; they had received the paperwork from the buyers and were waiting on their funds to be received before recording the new deed!! Then on January 24, we received the good news we had waited on for so long!! Emails arrived from both Gifts for Sight AND JRA Services informing us the sale transaction was complete with attached
documentation we would need for our tax records.

I contacted Fairfield who indicated it may take four to six weeks to complete the transaction on their end, transferring the deed information in their files. Before I told you my story, I wanted to make sure there were no more automatic withdrawals for monthly maintenance fees, the last of which was in January. None have happened since then.


What exactly does someone else need to do? EXACTLY what they ask. It's really pretty painless (except for the waiting!). From my end, the process was extremely simple!! Fill out the initial paperwork as requested on their website, sign and return any additional documents as needed from the closing company. Pray it will sell quickly, but be prepared with patience; legal wheels turn slowly.

I was a little concerned when the tax receipt finally came (since it was in January) if it would be for '06 or '07 tax year, but that was clearly laid out in the text....2006. The official "taxing" name of the organization is "Eye Birth Defects Research Foundation"

Fairfield sent out a notice around Jan. 14 advising of a one-time capital improvement fee (or something like that) of $184 and some change. So close to the end of this transaction, I really hated to risk messing things up by trying to get out of that fee. Especially since the "final word" had not yet come on the sale/new deed. So, we paid it. If Fairfield finds the fee should have been paid by the new
owners, then Fairfield can worry about that, but I seriously doubt that will happen.

Aside from the buyers delaying their paperwork, the only snag in the process came in December came when the closing company asked Gifts for Sight to contact the buyers to see what the hold up was, Gifts for Sight sent the email to ME requesting I turn in the paperwork. After a return email explaining it wasn't I holding up the process,
everything else went smoothly from there.

Somewhere in the process, either by email or phone (oh yes, I spoke to both representatives at Gifts For Sight and JRA Services...very nice people, by the way) I remember someone saying something about the timeshare being sold on an Ebay Auction. I remember thinking, "After all this...so THAT'S the way they sell it. Huh, I could have done that!" Well, maybe; maybe not. We'll never know for sure now,
will we?

Sunday, March 18, 2007

TimeShare Sales Play On Emotions

The timeshare sales people are experts in using your emotions to make you think you're getting a great deal that you are stupid to pass up when in fact the reality is the exact opposite:

Carlos, our sales associate, could not have been more professional; he was very low-key and answered all our questions. He even shared a secret. If we bought two less expensive silver weeks, we could switch off exchange and point accumulation years and would have the ability to reserve a week 13 months in advance versus 12 months if we only owned one red week.

Sounded smart to us: a $21,800 investment versus $67,400 allowing the same exchange opportunity with an earlier reservation date. We were actually interested!
entire article

Thursday, March 15, 2007

Taking Time Share Freebies

Here's a question: Is it unethical to go to time share presentations to get the freebies or discounted lodgings if you have no intent on purchasing a time share?

This is a question that was asked when one reported explained how to get discounted accommodations to Disney World. The newspaper's answer: "It really is no different than a grocery store offering free samples. If they don't want people to grab one, they shouldn't offer." Entire Article

Tuesday, March 06, 2007

Is A Time Share Loss Tax Deductible?

Nope...unfortunately since that would take some of the sting out of the loss. Of course, in the unlikely event you did have a gain, it would be taxable. More information here

Friday, March 02, 2007

Should You Keep a Timeshare?

Kiplinger financial magazine has a short blurb asking should you keep a timeshare. Unfortunately, it's simply a blurb and not a detailed article which would have been nice to see, but does show the pitfalls of time share ownership:

Two decades may be hyperbole, but the Reillys definitely stumbled upon one of the rubs with timeshares. They discovered the other two when they looked into selling: You may not get back what you paid, and the loss isn't deductible. "If you make money, you pay Uncle Sam, and if you lose, tough luck," says Terry... entire article