Timeshare Cancellation After Grace Period
If you frequently tune in to radio and TV talk shows hosted by Dave Ramsey, Steve Harvey and Suze Orman you may have heard the commercials for companies advertising a guaranteed timeshare cancellation solution. Those unhappy with their timeshares might see these commercials as a saving grace, but consumers should be extremely careful as many of these programs end up being scams.
Companies that advertise a guaranteed timeshare exit solution often want to charge thousands of dollars up-front to “cancel” your legally binding timeshare contract. Many times, what ends up happening is the timeshare exit company instructs you to cease communication with your resort and stop all future maintenance fee payments. When you stop paying your maintenance fees, there is a good chance your resort will eventually foreclose on your timeshare. When your timeshare is foreclosed upon, it’s technically canceled, but your credit score might also take a significant hit. The timeshare exit company will say it did its job because the timeshare is canceled, but all they did was tell you to stop paying your maintenance fees. Was that advice worth several thousand dollars? Absolutely not.
No Company Can Guarantee a Cancellation
The truth is, no company can guarantee that it will be able to cancel your timeshare because the decision to cancel can only be made by the resort or resort developer you purchased the timeshare from. The only exception to this is if you requested the timeshare cancellation within the rescission period. New timeshare owners in many states are protected under state laws that allow them to rescind the timeshare purchase for a full refund. If a new timeshare owner requests to rescind their purchase, the resort or resort developer has no choice but to refund you the full cost of the timeshare.
If you are outside of the statutory rescission period and you want to stop your maintenance fees, your best option is to either find someone who is willing to assume the loan or try to sell the timeshare on the resale market. Mamy timeshares can be sold on the secondary timeshare resale market, but it will take some time. The key is to work with a licensed timeshare brokerage such as Timeshare Broker Associates that has connections in the timeshare resale industry. We find buyers for timeshares through our relationships with our network of resale brokers around the country and a select number of by-owner resale companies such as BuyaTimeshare.com. We are licensed and earn a commission after the timeshare is sold without charging an up-front fee.
We handle the entire process, from the timeshare listing agreement, negotiating sales and drawing up the timeshare purchase and sale agreements. Give us a call at 877-624-6889 or fill out the contact form on the right side of this page to get started.
FAQ About Cancelling Your Timeshare
How Much does it Cost to Cancel a Timeshare?
Timeshare cancellation costs can be $5,000 and higher, with some operators known to charge as much as $10,000. These cancellation or exit companies claim to be able to get owners out of their timeshare ownership, but all they primarily do is just contact the resort on behalf of the owner to request the cancellation. This can be done by the owner themselves without paying an exorbitant fee. Remember that the owner has leverage with the resort and most resorts no longer work with cancellation or exit companies.
Can Timeshares be Cancelled?
In some cases, yes, timeshares can be canceled, but much of it depends on the resort or timeshare/management company.
Timeshares come under state law which allows for buyers to cancel within a specified timeframe following the initial purchase from the resort – known as a rescission period. The timeframe can usually be anywhere from three to ten days following the purchase, but these laws and timeframes vary from state to state. Your applicable law depends on the state in which the timeshare is located, so check with the relevant state law and your sales documents for more details.
If you decide to cancel after your purchase, it is important to follow the process as it is exactly presented in your sales documents. Your request will need to be in writing and timeshare companies will look for any potential loophole to reject your request, so follow the process as specifically as possible.
Once the rescission period has expired, owners can ask the timeshare company to cancel their ownership, but it is solely up to the resort to decide whether to cancel.
Many timeshare companies offer in-house options for owners to discuss cancellation options. Owners would contact their resort or timeshare company and are usually referred to customer service personnel to explain their options. These cases are considered on a case-by-case basis and timeshares need to be clear of any mortgages or liens with all annual fees paid and up to date.
These options are usually designed for long-term owners looking to opt-out or owners under severe financial distress who can document their situation. There is no guarantee that the company will agree to cancel a timeshare, but it may be worth contacting the resort to see if they can help.
In some instances, these programs have been used by companies to try and upsell owners into different timeshare programs, so be aware of this possible tactic if you contact your resort.
Are Timeshare Cancellation Companies Legit?
This depends on whether you think it is worth it to give from $5,000 to $10,000 to timeshare cancellation companies to possibly cancel your timeshare – mainly using tactics that owners can employ themselves without spending that kind of money.
Many of these timeshare cancellations or timeshare exit companies have come under legal scrutiny in recent years, with some forced out of business by court order. Others are under state Attorney General investigation, so consider these and other related regulatory actions when deciding if timeshare cancellation companies are legit.
Timeshare owners can often use the same tactics that these companies use – contacting the resort or management company and requesting a cancellation of their timeshare ownership. Some resorts will cancel rather than face the possibility of a judicial foreclosure since it would be more expensive for the resort to go through the courts than to just take back the timeshare.
The majority of resorts and management companies refuse to work with cancellation companies, and owners have more credibility with their resorts because, well, they are owners with a financial stake in the business. This often becomes a customer service issue for the resorts, and they would much rather work with an owner who is up to date with their maintenance fees than a cancellation company.
Why is it Hard to Cancel Timeshare?
Timeshare resorts want to keep their maintenance fee-paying owners for as long as they can, which can make it hard for owners to cancel a timeshare. There is no financial benefit for a resort or timeshare company to cancel timeshare ownership, since they will lose the annual maintenance fee payment that they rely on to remain in business.
That being said, many timeshare operators have policies in place to relieve owners of their timeshare obligations in certain situations such as financial distress. This involves the owner contacting their resort or management company directly to request a cancellation but be prepared to show documentation to back up your claims.
What Happens if you Refuse to Pay Timeshare Maintenance Fees?
Your credit can be severely damaged by not paying your timeshare maintenance fees, so be very careful about considering this as an option.
Timeshare maintenance fee payments are a contractual obligation that the owner agreed to when they bought their timeshare. By not paying the fees, owners open themselves up to possible debt collection hassles as the resort seeks to recover the money owed. The longer this goes on, the better the chance that the resort or management company can foreclose on the ownership.
At each stage of the process, the activity can be reported to the major credit bureaus - resulting in hits to the owner’s credit score.
Many timeshare cancellation companies recommend that owners stop paying timeshare maintenance fees as a tactic if owners are looking to cancel their ownership. This is considered by the resort as a breach of contract and rarely, if ever, works, since it creates an unsympathetic working relationship between the owner and resort.
If an owner is looking to cancel their timeshare, resorts require that maintenance fees be up to date just to be considered for possible cancellation. Not paying fees makes your request a non-starter in the eyes of the resort.
How Do I Get Out of Timeshare Maintenance Fees?
By selling your timeshare. The best and most effective way to get out of timeshare maintenance fees is to sell a timeshare, get some money back from your initial outlay and have it transferred over to a new owner. Licensed timeshare resale agents can help with this and they do no charge consultation fees or upfront fees to sell.
You could also try contacting the resort or management company to see if they can help, but it is not in their financial interest to help since they would be losing operating revenue which helps them stay in business. Some of the larger timeshare companies have customer service programs where owners can request help, so contact your resort for more information.
How Do Timeshare Cancellation Companies Work?
Timeshare cancellation companies target owners in their marketing who are looking to get out of their timeshares. Either through online or traditional marketing methods, these companies pitch that they can get owners out but what they don’t initially promote are the high upfront fees they charge for their services.
Owners contact timeshare cancellation companies and consult with a representative who explains that they reach out to resorts to facilitate the cancellation, which they claim can take 18-24 months to complete. Some cases can take even longer, but the company preaches patience while they supposedly work on behalf of the owner.
The fees for such services can run between $5,000 - $10,000 with no guarantee that the owner will be let out of their timeshare contract. Companies pitch a moneyback guarantee where they say they will refund in cases they cannot close, but these companies have been known to stall and, in some cases, go out of business before such refunds can be processed.
In reality, many timeshare operators have refused to work with cancellation companies because of tactics such as advising owners to stop paying maintenance fees or to cease contact with their resort.
In many instances, owners can contact their resort or management company directly and make the same request that the cancellation companies put forth to cancel a timeshare, without paying thousands of dollars in the process. Timeshare developers like Wyndham have programs set up such as Certified Exit – backed by Wyndham, which are designed to discuss such cancellation requests.