Timeshare Trouble

Timeshare Trouble

A consumer unable to resist the urge to own picturesque real estate in the Bahamas for just $3,000 makes the click on Craigslist and snatches up the opportunity. Stacey Udell, an accountant from New Jersey is now one of the 6 million Americans who own a timeshare.

That fateful day was now four years ago and neither Stacey, nor her family, have made it to the Bahamas once. Now Stacey is back on Craigslist, but in the seller’s section because in 2010, her annual timeshare maintenance bill is $1,650, up 20% from last year plus she also gets to pay $250 charge to make up for the other people who are struggling to make their payments.

Stacey is not alone. Tight contract restrictions, high and increasing annual fees and aggressive sales people have always made people skeptical of the timeshare market, but now in this market, people who did take the risk are struggling to unload contracts for just a dollar. Another buyer, Summers Doonan, a flight attendant from Orlando, knows all too what Stacey is going through. Summers bought a one-week contract in Cape Canaveral that cost her $18,000 in 2007. Now with children, she hardly has any time to go, but is still paying $1,150 in taxes and fees every year, an additional $90 to belong to an exchange club and another $200 each time she wants to trade. Both Udell and Doonan have listed their properties on Craigslist, TUG and other sites and are yet to receive any offers.

With the lack of sales, the rate of scams targeting desperate owners is through the roof. In 2009 alone, sales plunged 40% in the timeshare market. That on top of timeshare mortgage default and maintenance fees rising, is more than likely the reason people are trying to free themselves of their lifelong financial responsibility.

The economic downturn is affecting the timeshare market so badly, that not only are individual consumers losing substantially, so are the big companies. Marriott International’s sales fell 38% in 2009 to $445 million with the property being valued at $752 million. The company has now decided to stop any further builds and turn some timeshares into other types of properties. Another company, Westgate Resorts, one of the biggest in the industry, had a record year in 2009 with 2,200 new rooms. However, this year, the company has halted construction on “10 to 12” sites that already underwent groundbreaking.

Sensing desperation, many scamming resale companies have swooped down on Udell, Doonan and many others. Doonan paid $600 to a reseller who made fliers for her property she never saw. There are many such incidents flying around with companies like Universal Marketing Solutions and Creative Vacation Solutions currently under investigation.

Nusbaum of the ARDA (American Resort Development Association) said it best when he stated simply, “The secondary market doesn’t have the protections (that are in the primary market.”)

USA TODAY

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Charles Anderson

Charles has been a motivating force since the day one, and travels nationally with the Timeshare Relief team using his strong leadership skills to train new employees.

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