Timeshares offer dream vacations for people who can’t afford to buy a second home in a tropical paradise or other trendy tourist destination. However, for about 15% of people who decide to cancel theirs, a timeshare has shown to be as much a fantasy as a real dream.
If you recently bought a timeshare and realized that it isn’t worth the hassle or price, then you might be thinking about timeshare contract cancellation.
There’s a lot to consider when trying to break a complex real estate deal. Start by reading this guide to know the do’s and don’ts of when and how to get out of a timeshare while you still can.
What is a Timeshare Cancellation?
After purchasing a timeshare, you may want to try to cancel it without incurring even more fees. Most people realize that timeshares are more expensive than originally portrayed by the timeshare company. That is because the timeshare is usually part of a community and it is dictated by the company that charges for required maintenance, property assessments, and amenity fees.
Do Know the Cancellation Period
When you sign a timeshare contract you need to read the fine print. Somewhere in the document will be a cancellation period.
The Federal Trade Commission gives a minimum 3-day “cooling off” period for certain sales including timeshares. However, states also have specific laws regarding the timeframe for breaking a timeshare contract, which may give you additional days.
Check your contract as well as your state’s rule on the minimum cancellation policy before you sign. If you didn’t check the cancellation period before signing the contract then you need to review it as soon as possible to be able to cancel your timeshare without additional fees, court appearances, or more hoops to jump through.
Also, remember that timeshares in other countries aren’t subject to cancellation periods, so you may be stuck if your timeshare is in a foreign residence.
Don’t Rely on Verbal Cancellation
When canceling a timeshare contract during the “cooling off” period never use a verbal agreement. You may call and speak to a representative of the timeshare and they might tell you that your contract is canceled but what proof do you have?
Instead, put your cancellation request for your timeshare in writing. Be sure to include the following information:
- The Date of the Request
- Your Full Name as it Appears on the Contract
- Contact Information (Address, Phone Number, and Email)
- Timeshare Company Name
- Description of the Timeshare
- Date of Sale
- Statement of Cancellation
The postmark date of the letter needs to be before the cancellation period ends. You should also request a receipt and send it as certified mail to get delivery confirmation.
Don’t Give Up Past the Cancellation Period
If you can’t get out of a timeshare contract within the cancellation period then don’t assume you are stuck with the timeshare. There are a few circumstances that may still allow you to cancel your timeshare outside of the “cooling off” window.
The timeshare company’s actions could allow you to cancel your contract if they:
- Lied about the interest rate, price, or fees of the timeshare
- Used force, manipulation, or intimation to get you to sign the contract
- Didn’t put a rescission period in the contract
You need proof that one of the above situations occurred to show a court that the contract is illegitimate. It may be difficult to prove this unless you have a recording or documentation so don’t rely on these actions without evidence. You also will need representation from a timeshare exit company to help you with this process.
Do Know Your Selling Options
You’ve missed the cancellation period and the contract is valid, so what are your options now? You may choose to sell your timeshare just to avoid the cost of keeping up with maintenance fees, utility costs, property taxes, and special assessment charges if the company decides they want to upgrade the residence.
However, selling your property for any kind of profit isn’t likely. Some timeshares sell for as little as a dollar on marketplaces. And, many owners tend to give away their timeshare just to avoid the fees by handing it over to someone else.
Another option includes when the timeshare company sometimes has a surrender option in the contract that allows you to give your property back to them for a large fee.
The timeshare cancellation cost beyond the “cooling off” period is expensive, however, in many cases, it might be cheaper than keeping it and paying for the expenses.
Don’t Stop Paying Your Timeshare
Your timeshare is a property similar to your house. You technically don’t own it unless it is paid off. For example, your bank owns your house until you complete the mortgage payments. The same goes for a timeshare. In both situations, if you stop paying for your property, the bank and timeshare company can take it from you in foreclosure.
The process of repossession of your timeshare includes a lot of additional fees because the company may get a lien and go through with a lawsuit to get back the property, costing you attorney and court fees. Even if the company doesn’t go through the judicial system but rather through state procedures, the foreclosure of your timeshare still includes fees such as fines, interest, and accruing assessment costs.
Getting Help with Timeshare Contract Cancellation
For the highest chance of timeshare contract cancellation, hire a professional who helps you review the contract, manage legal actions, and cut the costs of canceling outside of the “cooling off” period. Doing this alone may lead to more expenses than if you simply keep the timeshare.