Nowadays, vacations can be quite expensive, but that does not mean one must sacrifice their vacations. Timeshare is a great way to vacation with a budget if you are flexible enough to manage it. A timeshare is when multiple people have shared ownership of a property, typically a vacation property, and each owner has a different time allotment.
This allotment can be a longer period or a shorter period. Many often think the timeshare model can only apply to vacation properties. However, it can also be applied to different properties, such as campsites and apartments. Timeshare is just a policy.
Since the buyers purchase a fraction of the property and have a right to occupy it over a specific period, they have to be flexible. In time-sharing, multiple parties pay for the property and own a percentage, but they get the entire property for a fixed period, depending on the other buyers.
Time-sharing may sound ideal if you plan on buying a vacation property at a low price. But while there may be a fair amount of benefits, there are also a fair amount of drawbacks to consider before investing in a timeshare property. Moreover, cancelation can be tricky if you withdraw from the purchase. This article will explain how you can cancel a timeshare and everything you need to know about timeshare properties.
Types Of Timeshare Ownerships
The two main types of timeshare ownership models are: shared deeded timeshare ownership and shared leased timeshare properties.
Shared Deeded Timeshare Properties
A shared deeded timeshare property gives each owner of the properties a percentage share, which usually depends on the period you have agreed upon. A resort condominium unit sold in timeshare increments of one week can technically have 52 total deeds. If you purchase it for one week of the entire year, you will own around one by 52 percent of the entire property.
Shared Leased Timeshare Properties
A shared leased timeshare property entitles the buyer of the property to use the specific property for a fixed amount of weeks. This is why leased timeshare properties can often be cheaper than deeded timeshare properties. However, these properties can be much harder and more restrictive when transferring ownership or selling.
How Do Timeshares Work?
Timeshares usually work in three main models:
In a fixed-week timeshare model, the buyer purchases rights to one or more fixed weeks each year. A great advantage of this model can be that the buyer can plan an annual vacation every year at the same time.
However, a downside of this is that you might be unable to change the time you want to go on vacation or extend the number of weeks you have bought. This can be very restricting because uncertain factors might force you to cancel or cut your vacation short.
In a floating week model, the buyer gets access to the property for a week or several weeks for a predefined time. While this may seem very flexible due to having access to the property throughout the year, it is only partially beneficial.
These predefined or float weeks may not be available during busy times of the year, usually the most desirable time slots to be on vacation. Floating weeks are also quite hard to transfer ownership or sell because they are usually part of shared, leased timeshare properties.
The points system model uses points to represent a person’s property ownership. It depends on different factors such as the property size, the time of availability, and even the location. These points are then allocated to buyers by developers.
Furthermore, these points can be used by buyers to exchange their timeshare property shares for other properties owned by the developers or even timeshare properties owned by other external developers. However, this system can also prove to be disadvantageous due to point factors involved in point allocation.
This is why most people do not use the points system and prefer using the other two models to get their timeshare properties. Another disadvantage of this model is that your timeshare points may lose value over time depending on various factors, some of which might be completely out of your control.
Can You Cancel A Timeshare?
Canceling a timeshare contract can be challenging and lengthy, but it is possible. If you have recently purchased a timeshare property and regret your decision, there might be a chance for you to cancel your timeshare contract if you act quickly.
There are many different factors that you must consider when it comes to canceling a timeshare. One of the main factors you must consider is whether your purchase is still in the rescission period.
You can cancel your contract and get a refund during the rescission period. However, as mentioned above, you need to be quick with your decision if you want to cancel your contract. This rescission usually lasts only a few days of the purchase, depending on the seller from whom you have purchased the timeshare property.
How Much Time Do You Have To Cancel A Timeshare?
The time you have to cancel a timeshare contract usually depends on state laws. Most timeshare buyers get the right to rescind their contracts within a specific time frame. Most states in the United States and other foreign countries offer buyers the right to rescind their contract within a specific period. This period may vary depending on which state or country you are in, but usually, it can be anywhere from 3 to 15 days.
State law normally requires the rescission period and the buyer’s rights to cancel the timeshare to be written in the contract. If this information is not written in the contract, you can take legal action against the person you purchase the timeshare property from. Moreover, the right to cancel your timeshare contract is often nonviable, which means that no matter what happens, the seller cannot make you give up your right to cancel the contract.
It is very important to remember that cancelation of your timeshare contract is your right, and no seller has the right to pressure you into giving up that right. Most buyers do not know that the cancelation information in the contract is a must. Sellers often try to scam buyers into signing a contract that does not have the information. That is why it is recommended that you read the contract thoroughly and ensure that the cancelation information is present.
What Is The Process Of Canceling A Timeshare Contract?
In most cases, you should end your timeshare contract in writing by presenting the seller with a cancelation letter. Even though the law doesn’t state that you must present the seller with a cancelation letter, it is always better to have one prepared in case, even if there is a chance for you to cancel orally.
One of the main reasons is that even after cancelation if a seller tries to create an issue, you will have proof of the cancelation in writing. Having proof such as this in writing is always a safer way.
While it may be optional to explain why you are canceling your timeshare contract, you need to specify that the reason for writing the letter is the cancelation. However, some information is mandatory to provide in the cancelation letter, which may vary depending on the state or country you reside in. These things include;
- The date on which you purchased the timeshare property.
- The name of the timeshare company that you purchased the property from
- A proper description of the timeshare property(you can use the information of the property mentioned in the timeshare contract description)
- The full name of the purchaser( it should be the same name that is written on the timeshare purchase contract)
- The current date on which you are writing the cancelation letter
- The address, phone number, and email address of the purchaser
- A clear statement that the main purpose of the letter is the cancelation of the timeshare contract.
The state should specify the method you use to deliver the cancelation letter, or the timeshare contract might provide you with the information required to send a cancelation letter.
There might be a complication when delivering the cancelation letter to the company because each company has its specific method. Some companies might want you to hand deliver the cancelation notice to them, while others will only accept delivery from specified registered or certified mail. It is important to note that you must send the cancelation letter to the company before the rescission period. Otherwise, there are high chances that your cancelation letter may not be accepted.
If you buy a timeshare property in a foreign country or state, the rescission period may depend on the laws of that region. Moreover, the delivery method and details you must mention in the cancelation letter depend completely on the state or country laws in which you have purchased the property.
However, it is recommended that you consult an attorney who can give you proper advice on rescission periods so that you can decide on whether you should buy a timeshare property.
Canceling A Timeshare After The Rescission Period Has Expired
Canceling a timeshare contract after the rescission period is difficult because the seller is not legally bound to give you a refund after this period. Therefore, your best chance of recovering your money would be selling your timeshare property to another owner. However, many scams occur when selling your timeshare properties, so it is important to watch out for them.
Getting a cancelation on your timeshare property after the rescission period may only be possible in very few cases. Depending on the state’s or country’s laws, you can claim a cancelation on the property after the rescission period.
How To Lookout For Yourself Before And After Purchasing A Timeshare Property
It is very important to have proper knowledge of the timeshare property details and the contact details associated with it because the recision period might as well have been over by the time you get back from your vacation. Therefore, you should thoroughly read all the terms and conditions of the contract before signing it.
Benefits Of Timeshare Properties
If you want any reasons not to cancel your timeshare, consider the following benefits:
When going on a vacation, you must follow many rules and regulations if you book a hotel. However, if you purchase a timeshare vacation property, you get your benefits and don’t need to follow any strict regulations, such as not being able to smoke in a room.
Hotel rooms can often be cramped if you are on vacation as a family. When you purchase a timeshare property, you don’t have to worry about cramped accommodation. You can enjoy the luxurious and spacious accommodation of your choice.
Another one of the benefits of timeshare properties is that once you purchase a timeshare property, your vacations are almost guaranteed because you don’t have to go through the extremely time-consuming planning phase.
Hotels can cost large amounts of money, especially if they are luxury hotels. You can own a good vacation home if you save and invest a decent sum of money into a timeshare vacation property. You can visit it whenever you want and don’t have to get into the hassle of booking periods.
A timeshare vacation property is easy to maintain because, unlike owning your own private vacation home, you do not have to take care of the maintenance of the property all by yourself.
Moreover, the maintainable fees can also be less than the maintenance fees you may have to pay if you own private vacation property.
Cheap Second-Hand Timeshares
Lastly, many people often get tired of their timeshare properties or cannot afford them anymore, so buying a second-hand can be much cheaper. Normally second-hand timeshare vacation properties can cost 2 to 15 percent less than the retail or market price.
Disadvantages Of Timeshare Properties
Timeshare properties also come with their fair share of disadvantages.
Large Investment Required
Hotels may be expensive in the short term. Still, timeshare properties can often end up costing you much more in the long term because even if you are paying a portion of the price, you are still paying the price of an entire luxury property, which can range anywhere from being the medium price to extremely expensive.
Therefore, you must have enough money to purchase a timeshare vacation property. Another downside of owning timeshare properties is that they often have high maintainable fees. Even if they start low, they may increase over time, which can end up making your dream vacation home a liability.
Another downside of timeshare properties is that if you plan to finance the property from the bank, your chances of receiving the financing can be very low. Most banks do not like to provide financing for a property you will only be spending a few weeks of the year. Moreover, banks would also prefer to avoid financing a timeshare property because there will be multiple owners, which can result in complications.
Uncertainty Of Location
Another issue commonly encountered with timeshare properties is one that most buyers often ignore. If you are buying a timeshare vacation property in another country, you might not be sure of the risks or the problems associated with the country or the area.
Since you will only be spending a few weeks there in the entire year, the weather can play a huge role in your vacation. If the weather is not to your liking, it can easily ruin or impact your vacation negatively.
Moreover, you might not be sure about the area’s security or whether the crime rate is high in that area. Hence, buying a timeshare property can often be risky to buy a timeshare property if you have not done your research properly.
Lastly, reselling a timeshare property can be quite hard as multiple parties are involved, and disputes can occur. Furthermore, timeshare properties are often confused with investments. It is important to note that they are not an investment because they don’t increase in value over time.
Hard To Sell
Selling timeshare properties can also be very hard because, in most cases, you cannot recoup your initial costs or initial investment. Sellers often list their properties for a higher price to make up for their costs. Meanwhile, buyers often prefer to avoid buying these properties because they are above market value.
However, there may be a few rare cases where property prices rise over time. An example of this can be property purchased many years ago in an area that is not very popular, but as it grows popular, there are chances that the price may increase due to the simple law of supply and demand.
Timeshare properties can be a great way to enjoy a vacation with your family, as it saves you the hassle of planning and booking hotels. However, there are also a fair few disadvantages you must consider before buying a timeshare property. If you want to cancel your timeshare contract, you can cancel it, as you have the right as a buyer to cancel it within the rescission period.
The rescission period may depend on which state or country you are in. To cancel a timeshare contract, you must write a proper cancelation letter mentioning all the information mentioned above. Lastly, it is recommended that you consult an attorney before buying a timeshare property, so you get a better idea of the rescission period and the rules and regulations of the state or country you are buying the property.