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NEED TO RETURN TIMESHARE (by Carvan A.):

Sabrina,

I totally agree with Ken but will add some additional thoughts in response to your question concerning "what can the timeshare companies do" if you walk away from your obligation.

Walking away is a step not to be taken lightly because as Ken has stated so well it will have a lasting adverse impact on your credit rating meaning the obtaining of credit will be difficult if not impossible and the interest rates charged will be higher when you do obtain credit.

First, you should consult an attorney if possible and if not then a consumer advocacy group to be sure you are well informed concerning your rights before you default.

There are two applicable Federal Statutes governing what any creditor (including timeshares and their collection agencies) can do. One is the FCPA (fair credit protection act) and the FDCPA (fair debt collection protection act). You should google them for more information. They were written to protect you the consumer.

Your rights under the Fair Debt Collection Practices Act include:

Debt collectors may contact you only between 8 a.m. and 9 p.m. Debt collectors may not contact you at work if they know your employer disapproves Debt collectors may not harass, oppress or abuse you Debt collectors may not lie when collecting debts, such as falsely implying that you have committed a crime Debt collectors must identify themselves to you on the phone Debt collectors must stop contacting you if you ask them to in writing

The last point is very important to remember. Any collecting agency that continues to "hound you" after receiving a letter to "cease and desist" may well become the defendant in an action brought by the FTC or by you. Collection Agencies cannot legally harass or hound you. They face severe penalties including the loss of their license to do business when they violate this Federal Statute. I have seen it happen.

The FCPA is well worth reading in its entirety but for your purposes here are some highlights:

Credit reporting agencies cannot report adverse information for more than seven years with some exceptions. Foreclosures remain on your record for seven years. One exception is a bankruptcy that can remain on your report for 10 years. Judgments remain on your credit report until the governing statute of limitations expires. That is typically 10 years in most states but will vary from state to state.

Persons (defined in the act as individuals, partnerships, corporations, trusts, estates, and so on) are required to report both good and bad infomration. I have yet to see a timeshare that reported the timely payment of a maintenance fee. The Collection Agency cannot report adverse information (legally) if the timeshare did not report both good and bad payment history in "the regular and ordinary course of business". Sure some will in the hopes of not been called on it but so do some of us drive 70 in a 60 mph zones. Not everyone obeys the law but you have the right to report violators to the FTC.

You have the right to challenge any adverse information and the credit reporting agencies have 30 days to provide you with written documentation of the debt. No collection agency can produce a contract wherein you agreed to pay annual maintenance fees. That is too complicated to explain here but any attorney well versed in consumer protection statutes can explain it for you.

Wage garnishment is highly unlikely because of the nature of the debt. This is best explained by an attorney but briefly let me explain it in layman language. First, the maintenance fee debt would have to be reduced to a judgment in the jurisdiction where the timeshare is located. Several years of fees would have to be involved to even make such action financially feasible. Then, the creditor would have to abstract the judgment in your jurisdiction in order to then proceed with a writ of garnishment. Wage garnishment is prohibited in many states and you need to learn whether your state is one of these states. As a practical matter the probability of a wage garnishment is very unlikely.