What is a Timeshare? FAQ
A timeshare is a form of ownership or right to the use of a property. These properties are typically resort condominium units, in which multiple parties hold rights to use the property, and each sharer is allotted a period of time (typically one week) in which they may use the property. The sizes range from studio units to 4 bedroom units. You pay an initial investment for the timeshare and then pay a maintenance fee each year for the upkeep of the property.
What are maintenance fees?
Maintenance fees are the costs to operate the resort. This cost is divided up among all of the owners. This includes the upkeep of each unit, common grounds of the resort property, maintenance of the property, improvements and insurance.
How much are maintenance fees?
Maintenance fees will vary from resort to resort depending on location, unit size, etc. They typically range from $300-$1,000.
What is the difference between buying a timeshare from the developer and buying a timeshare resale?
The biggest difference between buying from the developer and buying on the resale market is the price. On the resale market you can save 40% or more. Some resorts may have minor restrictions.
What is a home resort?
Your home resort is where your property is deeded. Normally this is the resort where you can reserve your week before submitting it for an exchange to another resort.
What is the difference between a fixed week and a floating week?
A fixed week is a set week that you will use every year. If you vacation the same week every year this is a great way to secure your vacation. A float week means that you can use your week at different times of the year. Some resorts sell their ownerships by season. For example, you may have an option to purchase in the winter float. This means that you will able to use your week at that resort any week in their winter season. The advantage of a floating week is that you have the flexibility to use your week at different weeks of the year.
What is a points program?
Points programs vary per company. Generally, when you own a timeshare with a points program you purchase a specific amount of points. The advantage of owning points is the flexibility of breaking up your vacation into 3-4 days as opposed to taking a full week at a time.
What is a lock-out unit?
A lock-out is typically 2 or more bedroom units that have a door in between that can be locked on both sides that seperate the unit in two. This gives the owner the opportunity to us the entire unit for 1 week or get 2 weeks of vacation by splitting the unit. Normally there is a nominal fee to do this, but the advantage is 2 weeks of vacation.
What is the difference between a deeded property and a leased property?
A deeded property means that you will receive a deed that you will own indefinitely. It can be sold, willed or rented. A leased property means that you get to use your week(s) at the property for a certain number of years. Usually 20-99 years, although some resorts have a lease in perpetuity. The right to use usually returns to the resort at the end of the lease.
How do I exchange my week?
You deposit your week with the exchange company affiliated with your resort. The two largest and most popular are Resort Condominiums International (RCI) and Interval International (II). All you need to do is reserve your week at your home resort and submit a request for an exchange to your desired resort. The exchange company does not need to find someone to use your week before they will give you an exchange. It is very important to deposit your week early to have more power with your week. Each exchange company has different rules for exchanging and there are fees for the exchange. These fees vary depending on where you are going and the exchange company you are a member of.
Where should I buy a timeshare resale from?
You should always buy from a licensed real estate broker with timeshare resale. If you deal with individual sellers or non licensed companies you are risking the money you pay and also you will have no place to turn if there is a problem later. Working with a licensed broker, you have someone who will handle the negotiation, communication with the seller, contracts, estoppels, right of first refusal requests, work with the title company, etc. A licensed brokerage who specializes in timeshare resales can ensure a smooth, easy transaction with no hassle for you. Also, make sure a 3rd party holds escrow until the resort confirms the transfer has been completed.
Is it necessary to pay an upfront fee when listing a timeshare on the resale market?
You should never pay an upfront fee for selling your timeshare. You should only work with Licensed Real Estate Brokers that do not charge a fee to list your timeshare. Upfront fees are typically advertising fees that are paid when you advertise your timeshare for sale with a timeshare resale advertising company. It is common that these that these advertising companies recommend an inflated price for your timeshare just to get your business. However, if they are not licensed real estate agents they can not sell your timeshare for you, they can only advertise it for sale. Do your research first and be cautious of anyone who asks for an upfront fee.
Why are prices so low on the resale market?
When you purchase from the developer you are paying their marketing fees it cost to get you in there. These are generally around 50% of the sales price. When you buy a timeshare on the resale market you pay fair market value which is usually thousands less than retail value.
Do I have to attend the closing in person?
No you do not. Transactions are done via email, fax or mail.