Savings & Investment, Smart Spending

Is It Ever a Good Idea to Buy a Timeshare? Part 3

In our previous article, we discussed the different types of timeshare offerings (fixed unit, fixed week or points-based vacation plan) and how each one works. Now we’ll discuss the sales tactics some organizations use and what you need to know if you decide to buy or one day decide to sell.

Very often, when you’re staying at a hotel – from budget to five star – they’ll be a desk in the lobby with a representative just waiting to sell you on the virtues and great qualities about their timeshare. Sometimes the timeshare resort is associated with the hotel (think Marriott, which has a Marriott Vacation Club program) and sometimes the timeshare company just rents space from the hotel.

Some of these presentations are really good; many are not. You’ll be enticed – through promises of a small cash payment, or theme park tickets, or a free vacation (usually at another budget hotel) – to sit through a presentation designed to get you to buy into the timeshare or vacation rental plan.

If you’re married or have a domestic partner, they’ll insist both parties need to be present. And while they may very well tell you that you’re under no obligation to buy, these types of things tend to turn into very high-pressure selling machines. If you’re strong enough to resist and the lure of the free tickets to Disneyworld is too good to turn down, by all means, go and see one of these presentations. But beware of what you’re getting into and try not to make any decisions on the spot. It’s when we make financial decisions without thinking them all the way through that we get into trouble or have many second thoughts.

Any reputable timeshare company will not pressure you into signing a contract at the end of the sales pitch. Ask to be given a contract with a detailed pricing list to show how much your initial costs (including closings costs – remember this is a real estate transaction so there are closing costs associated with it) will be, what your yearly costs will entail (real estate taxes, association fees, etc.) and whether there’s the possibility of any additional assessments.

If possible, talk to other owners in the timeshare, or even local real estate agents (who sometimes work to sell the timeshares), to get their impressions on whether the deal is a good one and if what you see is what you’ll get.

Since there are so many timeshares up for resale, you may be able to find a resale deal not only on a website (Sell My Timeshare Now is a popular one) but also through the original selling company. For example, the Disney Vacation Club requires you to offer them your points for a buyback before you put them up for general sale, so there are ways to buy a previously-owned timeshare through the company’s inventory of buybacks.

Finally, make sure that any contract you sign has the right of rescission, which means that you have the right to cancel, usually within 3-7 days of signing the agreement. Too often, you can get caught up in the excitement of the timeshare tour, or the promises of perfect vacations forever, and you want to make sure – when reality sets in (and it will, I promise you) – that you can get out of the contract if it really was not the right thing for you to do. Most states have laws allowing a right of rescission; if your state doesn’t, ask that it be included in the agreement.

If you do all the rights things, ask all the right questions, are convinced that a timeshare or points-based vacation plan is right for you and get everything in writing, then you’ll be in the best position to make the best decision for you and your family.