Have you received a phone call or e-mail from a company trying to convince you to sell your timeshare? Be careful, because it could be a scam. More timeshare owners have reported being contacted by individuals claiming to work for real estate companies that specialize in reselling timeshares, also known as “resellers.” The person usually states that their office is overwhelmed with buyers looking for timeshares similar to yours, and they can sell your timeshare for thousands of dollars more than you paid for it. Time shares rarely appreciate in value. This scam sales call or “phishy” e-mail always ends with the instruction to pay a large fee or supposedly “refundable” security deposit upfront by wiring the money to a bank account. As soon as the money is wired, the scam artist closes the bank account and, along with the money, disappears.
If you are thinking about selling your timeshare, there are several things you can do to protect yourself from scams.
Make no assumptions about your “real estate”.
First and foremost, do not go into selling your timeshare with the expectation that you will recoup the amount you paid for it or make a profit, especially if you have owned it for five years or less or it is in an obscure location. Generally, a timeshare may save you some money on vacations, but it is not considered a traditional real estate investment. Also, do not presume that selling a timeshare in a resort is easy. Some resorts place restrictions and fees on resales, so check with your timeshare’s resort to see if its rules will inhibit your sale.
Take your time.
Do not agree to anything during the initial discussion with a timeshare reseller, whether on the phone, online, or in person. Take time to research the company with the Better Business Bureau, your state Attorney General’s office, and local professional associations to ensure that you are dealing with a reputable business. You should always make certain that the reseller is properly licensed to sell real estate in the state where your timeshare is located.
Know the costs.
Clarify all fees and costs with the company. Most legitimate resellers will not require payment of any fee until after the timeshare is actually sold. If the reseller demands a fee upfront, do not work with them because it could be a scam.
Get everything in writing.
After you have concluded preliminary conversations with the reseller, ask for all information in writing. This will assure that you are both on the same page and eliminate surprises when the time comes to sign the contract.
Read the contract before signing it.
In most instances, once you decide on a company to sell your timeshare, you will enter into a listing agreement. Before signing the agreement, make sure it describes in detail the company’s obligations, including the marketing and advertising of your timeshare, as well as the total amount you must pay in costs and fees. In addition, double-check that the agreement specifies when and if you must pay the reseller, when the contract between you expires, whether you can rent or sell the timeshare yourself while the company is trying to sell it, and who will be responsible for closing the sale. If the contract is not what you expected, do not sign it. You can either negotiate or find another reseller.
For help with issues or concerns involving timeshare resellers, you can contact the Federal Trade Commission or the Real Estate Commission in the state where the timeshare is located.