Although some people are happy owners of timeshares, millions of others regret having bought theirs and would like to get rid of them.
When you buy a timeshare, you’re buying the right to vacation at a resort for the same one or two weeks every year. It might sound attractive when you buy it but, for many, the novelty soon wears off and the drudgery of visiting the same place at the same time each year proves boring. Or perhaps your lifestyle changes, making it impractical for you.
Timeshares Can Be a Financial Burden
Some people pay cash for their timeshare, but most finance their purchase and force themselves to make monthly payments. Timeshare owners also incur annual expenses for maintenance and taxes.
Most buyers paid too much for their timeshares. Many have discovered that the location has declined in quality, reducing its appeal as a vacation destination. Many developers have increased the annual fees that timeshare owners must pay.
All this has caused millions of timeshare owners to want out. But few people are interested in buying, especially at the price that the current owners had paid. Indeed, selling a timeshare can be difficult, even downright impossible.
What You Can Do to Get Rid of a Timeshare
First, understand that you are legally obligated to repay the loan. Even if you paid cash, you are still legally required to pay the annual operating cost. If you don’t, your credit record will reflect your failure to pay. This could hurt your ability to get a mortgage or car loan. It could also affect an employer’s decision to hire you.
If you want out, see if the developer is still selling timeshares at your vacation location; ask senior management if they might be willing to buy yours. It’s a long shot, but perhaps they might, albeit at a steep discount.
If they are not willing to repurchase it, perhaps they’d be willing to try to sell it for you. You might need to offer them compensation for doing so.If that doesn’t work, visit the web. Several sites help people dump, er, sell their timeshares.
Watch out for Frauds and Scams
But beware of con artists. Timeshare owners are known to be a desperate lot, and as soon as you make it known that you’re interested in selling yours, thieves will come calling. They’ll offer to buy your timeshare, or they’ll say they can sell it for you.
In both cases, they’ll demand up-front payments or personal financial information, such as your bank account number (purportedly so they can wire money to you). Timeshares give con men terrific opportunities to scam people twice — first in selling them nearly worthless timeshares, and again as they promise to help hapless victims get rid of them. Be wary of promises, and guard your money, your identity and personal data.
If you can’t find a buyer, and if your loan is fully repaid, try donating your timeshare to charity. The charity is likely to auction off your timeshare, which could provide you with a small tax deduction for the charitable contribution. Many charities refuse to accept donations of timeshares. Explore the Internet for entities that offer to handle this process for you.
As a last resort, try to give it away. Maybe you can find someone who will take it off your hands by assuming your financial obligations.
When you do manage to unload it, the loss is not tax-deductible. That’s because the IRS considers timeshares to be personal property, not investments. Hope the guy who sold you yours didn’t claim otherwise.
Neither Financial Engines Advisors L.L.C (also referred to as Edelman Financial Engines) nor its affiliates offer tax or legal advice. Interested parties are strongly encouraged to seek advice from qualified tax and/or legal experts regarding the best options for your particular circumstances.