Consumer Alert: Avoid Pitfalls of Timeshare Resales
CONSUMER ALERT: AVOID PITFALLS OF TIMESHARE RESALES
PROCEED CAREFULLY WHEN RESELLING TIMESHARES
LITTLE ROCK – During difficult economic times, many Arkansans look to cut costs, and unloading their investments in timeshare properties may seem to be a reasonable way to save some money.
Con artists see timeshare resales as yet another way to try to take advantage of consumers. The Consumer Protection Division of the Attorney General’s Office has seen a substantial uptick recently in consumer inquiries and complaints regarding timeshare resellers. Accordingly, Attorney General Dustin McDaniel today issued this Consumer Alert to inform timeshare owners about the risks of dealing with disreputable resellers.
A timeshare is a type of property in which an owner buys the right to use the property for a designated period of time. Most often located at popular vacation spots, these are typically condominium units that share several “owners.”
Mass marketing and high-pressure sales in the 1970s and ‘80s led to a boom in timeshare purchases. As consumers face increased assessments and maintenance fees, coupled with a depressed economy, more and more consumers are eager to sell their timeshares. A number of operations that bill themselves as timeshare resellers have sprung up to take advantage of those sellers.
The initial, significant marketing costs of the timeshare units were included in the original price, making it difficult for timeshares to retain their value. In addition, timeshare units were overdeveloped in many vacation spots, leading to a glut of properties and depressed values. This makes resale difficult.
“Some consumers who own timeshares are burdened by the increasing costs of their investment,” McDaniel said. “The promises of some resellers may appear to be attractive to those seeking to sell their timeshares, but consumers should use caution and make sure those promises aren’t shallow.”
McDaniel encouraged owners of timeshare properties to keep in mind the following information about resales:
- Be cautious when a timeshare reseller makes an unsolicited contact with the promise to help you resell your timeshare.
- These resellers most likely do not have willing buyers at the ready, even if they say they do.
- Never pay a substantial advance fee for resale assistance. A reputable reseller will charge a commission paid only upon sale, just like a normal real estate transaction. An advance fee may be called a “marketing fee,” a “listing fee,” an “Internet advertising fee,” or something else. No matter what it is called, don’t pay it in advance.
- Get an independent appraisal from a licensed appraiser before agreeing to any resale assistance contract.
- Deal only with licensed agents. Check with the Attorney General’s Office, the Arkansas Real Estate Commission or the Better Business Bureau before entering into a contract for resale or if you have general questions about timeshare resales.
To file a complaint about a timeshare reseller, or for more information about this or other consumer topics, visit the Consumer Protection Division’s website, GotYourBackArkansas.org, or call Attorney General McDaniel’s Consumer Hotline at (800) 482-8982 or (501) 682-2341.
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