Original Message:
Took out a loan to pay off timeshare mortgage in order to offload - good idea? (by KC):
arelg wrote:My wife and I decided to take out a loan to pay off the remaining balance of the Mortgage on my Westgate timeshare. The plan was to pay it off and sell it for nothing so that we didn't have to continue to pay rising maintenance fees and no longer had the burden of it. The balance is just about $15k. I wanted to make sure this was the best move to make before pushing ahead? Are there other options?
Even if / once the loan is paid off, you would have a hard time giving a Westgate ownership away for free. This is because Westgate (deliberately) devalues "resale" ownerships by imposing very restrictive reservation conditions on resale owners. You would then have a paid off timeshare that no one wants and still be the owner of record responsible for maintenance fees.
To give the timeshare back to Westgate via their "Legacy" deedback program, the loan would first obviously have to be paid off in full. Westgate (believe it or not) will then still demand another $950.00 from you before they would accept a deedback. Your maintenance fee obligations will then end, but you will have given another $15k to Westgate --- and have borrowed $15k to do so.
I am NOT offering this as "advice", but you have specifically asked about "other options". One such "other option" is to just walk away from the loan right now and not pay another dime of the $15k still owed to Westgate, thereby defaulting on the loan and experiencing foreclosure. Understand clearly, however, that this particular "option" will have negative credit report ramifications lasting for the next seven years, during which time there is obvious impact with lenders on your loan eligibility anytime during that seven year time frame.
It's a difficult personal choice and decision whether or not you want to pony up $15,000 to pay off something that is, even right now, literally worthless in the resale market, while still having a different loan to pay off for that same amount of money (and maybe at a higher interest rate --- you haven't disclosed that relevant detail).
I don't envy your difficult situation. You are between a rock and a hard place. Good luck with your decision, whatever it may be.