Getting rid of your timeshare

I agree. FMV has been well discussed herein.

I appreciate your concern. However, I will stand by the premise the we are just as concerned about scams and ripping donors off as much as your are. We have set up our processing to be absolutely third party. We take no money and do none of the paperwork. All that is done by licensed and qualified title/escrow companies. We are only the final recipient of the results.

We may differ in our opinions to what the IRS says and/or implies. It is to each individual to read for themselves and decide what is relevant. We have done so and stand by our opinions.

carvana wrote:

1. Who holds title to the timeshare during the 36 month holding period or until the property is sold. Your firm or the donor? 2. Who pays the maintenance fees during the period between the donation and the sale? 3. Has any of the donated property gone into foreclosure? Is your firm listed with Dub and Bradstreet and if so what is your credit rating.

Here's the answers you seek. 1. Title is taken in the name of Community Health Training, inc., which is the charity I work with. At the end of the title company process legal ownership is transferred away from the donor (they are free) and to us as a new owner. 2. Maintenance fees are the responsibility of the owner, which upon completion of the process is CHT, Inc. As to payment, since we do not use it, we do not pay them. There is no legal recourse to the previous owner (donor). Not paying is not illegal. All we say is we are willing to let the resorts have their best shot at us. We simply ignore them, which is anyone's legal right. 3. In the last three years, only 1 timeshare has gone to foreclosure and many have refused to accept the deed back at the end of the 36 months. Interestingly, the resorts seem to prefer carrying an unpaid due bill instead of losing that "positive" asset and regaining ownership of a timeshare holding no value until resold. Since a foreclosure is NOT a sale, it does not trigger a Form 8282 alteration to initial granted FMV of the donation. 3b. D&B? I have no idea and we don't care!. That's the key to why we can do what we do for donors. We don't succumb to the same scare tactics and pressures exercised by the resorts. Restriction of use, harassment via the collection process, and final ruination of credit is the ONLY recourse open to resorts. With us, it's a worthless and pointless attack.

In other words, we use the law to fight others using the law. A final interpretation would have to be solely on the concept of a debtor's prison versus negative credit reporting. Since debtor's prisons are no longer a part of law, we are willing to accept our "punishment" (restricted use, a negative credit report, and subsequent reduction in the use of credit) for none payment of resort due bills.

Other than the opinion of resorts clamoring for their money and a few uninformed individuals crying for "fairness", we have found no legal objection to what we do. As you have questions on the legality of the process, we are more than willing to continue in this discussion. However, please don't take it to "fairness" or "rightness" issues. Too many owners have found that resorts don't play by those same precepts.

drk14 wrote:

In the last three years, only 1 timeshare has gone to foreclosure and many have refused to accept the deed back at the end of the 36 months. Interestingly, the resorts seem to prefer carrying an unpaid due bill instead of losing that "positive" asset and regaining ownership of a timeshare holding no value until resold. Since a foreclosure is NOT a sale, it does not trigger a Form 8282 alteration to initial granted FMV of the donation.

I do not (and will not) profess to have any knowledge or expertise in the arena of tax law, nor will I offer opinion or comment on the ethical aspects here. That much clearly stated, two specific items from the quoted statement above still raise my eyebrows:

1. I would have assumed that many (perhaps most) facilities would challenge from the outset the validity of ANY new deed in which a timeshare ownership morphs from identifiable individual(s) into the name of a corporation (non-profit or otherwise). I also find myself wondering how many established timeshare closing companies would willingly conduct a timeshare closing in which the new grantee is a "corporation" (non-profit or otherwise).

2. Aside and apart from point 1. above, I would have assumed that very few resorts would actually endure 3 years of unpaid bills before initiating foreclosure proceedings. Accordingly, your assertion that you've experienced only ONE such foreclosure is quite surprising...

I read in your questions an opinion that somehow corporations are less acceptable than individuals. I've been in business for almost half a century and have never found this to be an attitude I've seen or felt.

Corporations can do anything individuals can do. In fact, my understanding of the law is that corporations are considered legal individuals. The difference is there may be more than one person behind the corporate image, and in some cases the results of legal action stops at the corporation. While in others it proceeds to the individual owners.

Here's an illustration. There is a difference between a Use Contract without a deed and a deeded timeshare. The first is governed by contract law that can allow pursuit of other assets. However, as a contract it can not be "forever". It must have a stated end.

Different laws dictate that when real estate has liens against it, the only recourse is foreclosure which stops at returned title. Another aspect of real estate law is that it can be passed to heirs "forever". This is how ALL timeshare owners need to understand their dilemma of non payment. The only recourse living beyond the foreclosure is reporting a negative entry on credit bureaus.

Now, if you look at it from the resorts point of view, they have far more individuals than corporations opting to stop paying. Based on this it would seem counter to your concern. In addition, corporations are subject to the same legal actions and consequences. Like individuals, some corporations find negative reports on their credit history is of little concern. Thus, again, they have the same options as individuals. We choose to not be concerned about our credit history.

Now, why do resorts not foreclose? I would think for the same reasons thousands of banks don't foreclose on homes right now. We hear about all that have, but it is estimated that approximately twice as many homes are subject to foreclosure as are actually facing court action.

The reason is accounting principles. Real estate holding liens is carried on the positive side of a ledger and considered an asset so long as it held there (whether paid or not). The action of foreclosure removes this positive ledger entry and results in a reduction of net value to the bank. At the same time, it is moved to an accounting entry called "Non-Performing Asset" which means it is owned, but has no value. In other words, the foreclosure process reduces the net value of the bank and reduces their ability to conduct financial business. The only way to gain value is to resell this NPA. If done at a lower price than the original liens, it ends up in a net loss period, end of story.

So, resorts don't usually pursue actual foreclosure for the same reason. Doing so reduces their net value and restricts their financial activity. If they send it to a collection agency, it's out of their hair and they can continue to increase their net value by adding more and more due bills to their ledger. Although they don't have the actual cash from payment, their bottom line net value continues to increase.

Thus, only 1 resort has foreclosed on all we have.

drk14 wrote:

I read in your questions an opinion that somehow corporations are less acceptable than individuals. I've been in business for almost half a century and have never found this to be an attitude I've seen or felt.

With all due respect, you read / interpret incorrectly; I harbor no opinion at all on any such gradations of "acceptable". Moreover, my question is fundamentally one of legality (i.e., not relating in ANY way to "perceptions" or "attitudes").

My questions were (and frankly, still remain) based upon a presumption that any attentive resort might very well choose to challenge the legal validity of any and every "resale" deed in which there is suddenly no identifiable, accountable individual(s), absent the requisite (and time consuming, expensive) legal energies required to "pierce the corporate veil". In such a potential scenario a "donor", even after seeing a new deed recorded in the new "corporate grantee" name (...and even after paying your $500 "service fee"...) could still find themselves hounded by collection agencies for maintenance fee payments (plus interest) by a resort which refuses to accept or acknowledge the validity of ANY "faceless corporate grantee" deed.

Mine is clearly a legal concern and issue, perhaps one also subject to variances in different states' laws. It is, in any case, a matter admittedly outside my own realm of legal knowledge and / or expertise. That much clearly acknowledged, you will still have to just "color me dubious" that this particular contrivance of "ownership abandonment" actually exists on legally solid ground...

ken1193 wrote:

. . . any given resort might very well overtly choose to challenge the legal validity of any "resale" deed in which there is suddenly no identifiable, accountable individual(s), absent the requisite (and time consuming, expensive) legal energies required to "pierce the corporate veil". In such a potential scenario a "donor", even after seeing a new deed recorded in the new "corporate grantee" name (...and even after paying your $500 "service fee"...) could still find themselves hounded by collection agencies for maintenance fee payments (plus interest) by a resort which does not / will not choose to accept or acknowledge the validity of the new "corporate grantee" deed.

I appreciate your questions and concern.

We are strictly the end product of the deed transfer process. We ask the donor to choose their own title/escrow company. We do have two we have worked with for several years who are well experienced in timeshare title transfers, but that's the only reason we promote them. We have no financial association with them other than their giving a discount to our donors. A donor may choose another if they wish. Our contact with a different title/escrow company is to address these same concerns for the protection of the donor.

They, in their experience, make sure title is transferred properly and legally. Once done, there is no legal reason the resort may challenge. Unlike a Quit Claim Deed, regular or warranty deeds deal with moment of time issues. A Quit Claim Deed is used by many people to avoid payment of past due bills. A regular or warranty deed deals only with the date of recording. All bills due prior to that recording date are legally the responsibility of the donor. All bills which are charged after that date become the responsibility of the new owner. This does not give the resort a legal right to seek recourse from prior owners.

Part of the closing process handled by an experienced timeshare closing company (hence the two we suggest) is to contact the resort to ascertain if there are any restrictions, conditions, or concerns from the resort for the process. These closing companies have a sign off process they use with the resorts that covers this issue of ownership entity. We have found two or three resorts that do require an individual's name. Those were halted and the monies returned to the donor. We can't help everyone.

Since we don't deal with the paperwork process I would suggest you contact the closing companies we have experience with and ask these question or any others regarding the process to them. This is our page listing those companies - http://www.communityhealthtraining.org/TimeshareClosingCompanies.htm .

drk14 wrote:

A Quit Claim Deed is used by many people to avoid payment of past due bills.

A Quit Claim deed will not permit avoidance of past due bills. A Quit Claim deed must have a grantor and a grantee .... you can't just make up a Quit Claim deed unless another party is willing to take ownership.

drk14 wrote:

I appreciate your questions and concern.

We are strictly the end product of the deed transfer process. We ask the donor to choose their own title/escrow company. We do have two we have worked with for several years who are well experienced in timeshare title transfers, but that's the only reason we promote them. We have no financial association with them other than their giving a discount to our donors. A donor may choose another if they wish. Our contact with a different title/escrow company is to address these same concerns for the protection of the donor.

They, in their experience, make sure title is transferred properly and legally. Once done, there is no legal reason the resort may challenge. Unlike a Quit Claim Deed, regular or warranty deeds deal with moment of time issues. A Quit Claim Deed is used by many people to avoid payment of past due bills. A regular or warranty deed deals only with the date of recording. All bills due prior to that recording date are legally the responsibility of the donor. All bills which are charged after that date become the responsibility of the new owner. This does not give the resort a legal right to seek recourse from prior owners.

Part of the closing process handled by an experienced timeshare closing company (hence the two we suggest) is to contact the resort to ascertain if there are any restrictions, conditions, or concerns from the resort for the process. These closing companies have a sign off process they use with the resorts that covers this issue of ownership entity. We have found two or three resorts that do require an individual's name. Those were halted and the monies returned to the donor. We can't help everyone.

Since we don't deal with the paperwork process I would suggest you contact the closing companies we have experience with and ask these question or any others regarding the process to them. This is our page listing those companies - http://www.communityhealthtraining.org/TimeshareClosingCompanies.htm .

So, after you take the deed (donation) from the owner do you then pay all future maintenance fees .... if not, then your service is a scam and you are holding all other owners of the resort hostage by forcing them to take up the slack of the non-paying holders of deeds .... this is not fair to owners that do pay their maintenance fees.

Below is what I found on one such LLC .... who then is the new owner that will be named on the deed and who will be responsible for all future fees?

"After validation, very rarely will it take longer than 48 hours for the closing company to have the new deed prepared and returned to you for signature. You must sign the provided deed and return it to the closing company. They will in turn record it with the applicable county and handle the transfer and notification requirements with your resort.

Once all the above steps are complete, and the deed is recorded in the new owner’s name, funds will be dispersed from escrow. You will receive a check for $10.00 along with a copy of the deed showing the new owner. The remainder of the escrow funds will be used to cover the closing company’s fee, resort transfer fee and our service fee".

To DKR14:

You say that only one resort (that is, owners association) has foreclosed on a timeshare held by your corporation despite the corporation purposely not paying the maintenance fees for 36 months or more.

You then use accounting principles to explain this by suggesting that publicly traded banks (owned by stockholders and heavily regulated) delay home foreclosures to inflate their book value by carrying a mortgage on their books that has a much higher value than the value of the collateral (home) that must be "marked down to market value" on their books following a foreclosure. Such a practice would indeed inflate the book value of the bank and could mislead prospective investors in violation of SEC regulations.

But, your comparison with the practices of a publicly traded bank and a Timeshare is comparing apples and oranges. You like to address the Timeshare as a Resort (e.g., Hilton, Westin, Marriott, Hyatt and so on) when in reality it is a group of people who own a small real estate interest in a Timeshare and who collectively have elected a group of directors (owners association) to hire a company (e.g., VCR) to manage the Timeshare. The owners association has no reason to inflate their balance sheet by delaying a foreclosure. They probably delay the foreclosure because it is an expensive process and the market for Timeshares is flat at this time anyway. The OA may also be delaying the foreclosure in an effort to determine who the real owner is. Maybe the OA suspects the corporation is merely the alter ego (court disregards the corporate entity and holds the individuals responsible for the acts done in the name of the corporation), a process known as piercing the corporate veil to prevent fraud or wrongful acts done in the name of the corporation.

I seem to have missed a few posts.

jayjay wrote:

A Quit Claim deed will not permit avoidance of past due bills. A Quit Claim deed must have a grantor and a grantee .... you can't just make up a Quit Claim deed unless another party is willing to take ownership.

Correct on sentence one.

A quit Claim Deed has a Grantor and Grantee named on the deed. However, the grantor can file one without the acceptance of the grantee. This is why they can be challenged later and dismissed.

jayjay wrote:

. . . a scam and you are holding all other owners of the resort hostage by forcing them to take up the slack of the non-paying holders of deeds .... this is not fair to owners that do pay their maintenance fees.

Welcome to reality. I guess it depends on which side of the "Forever" billing process you are on as to how you view it. A scam is illegal. We are fully legal. Because you don't like it doesn't make it illegal or a scam. We are simply taking the position of an owner not willing to continue paying a ransom. We accept the full recourse of the law. What we do is use the law against the resort (OA) or however anyone wants to name the bill issuing entity.

As to your next post, it essentially covers the elementary steps of the process. I would suggest anyone wanting to actually find the timing of the process call and talk to an actual escrow company that handles lots of timeshare deed transfers before assuming it is a simple and fast process. We don't do it, but we usually find it takes 45 to 90 days or more from the start waiting for any title company to do it correctly because part of that process is awaiting everyone's responses, including the resort.

carvana wrote:

in reality it is a group of people who own a small real estate interest in a Timeshare and who collectively have elected a group of directors (owners association) to hire a company (e.g., VCR) to manage the Timeshare.

Remember my comment about corporations and individuals being the same under the law? It applies to OAs as well. Whether a huge publicly traded corporation or a small OA or an individual they are all essentially the same under the law.

carvana wrote:

The OA may also be delaying the foreclosure in an effort to determine who the real owner is.

What? All they have to do is check the deed to find the current owner. If it's a corporation the next step is to check with the state of incorporation to find individuals NOT hiding behind some corporate veil.

carvana wrote:

. . . to prevent fraud or wrongful acts done in the name of the corporation.

I think I've given enough response to the legality in answer to your assertions and questions. Why do you continue to question the legality of what has been shown to be clearly lawful?

As fun as this discussion is and as much as I welcome the opportunity you've given me to proclaim the legality, efficiency, and efficacy of what we do for timeshare owners feeling the boot on their necks, I will ask you to get on to another complaint that hasn't been covered already. If you can show what we do is illegal or doesn't work, by all means please do. Other than beating a dead horse, please bring some new ideas to this discussion or leave it well enough alone.

"Why do you continue to question the legality of what has been shown to be clearly lawful?".

The legality has not been shown but I agree our discussion is over. Time will tell whether your operation is legal. I personally think the greatest threat to your operation is the IRS but I know from your previous comments that you disagree.

If what you are doing works and is not successfully challenged then there will be many "copy cats" duplicating it and over time many Timeshares will be out of business especially the small ones who do not have the resources to fight you. -30-

drk14 wrote:

Welcome to reality. I guess it depends on which side of the "Forever" billing process you are on as to how you view it. A scam is illegal. We are fully legal. Because you don't like it doesn't make it illegal or a scam. We are simply taking the position of an owner not willing to continue paying a ransom. We accept the full recourse of the law. What we do is use the law against the resort (OA) or however anyone wants to name the bill issuing entity.

How I view it has nothing to do with anything .... when a timeshare buyer signs on that dotted line then he/she is also legally signing to pay yearly maintenance fees until that person sells or gives it away .... it is what it is.

If you (the socalled donation) DO NOT pay the yearly maintenance fees when you take the timeshare then you are NOT A LEGAL ENTITY, PERIOD. In other words you are not only scamming the resort but you're scamming all the other owners who pay their yearly fees .... YOU ARE A SCAMMER. You can hide behind a socalled LLC, but waht you're doing is NOT LEGAL.

carvana wrote:

"Why do you continue to question the legality of what has been shown to be clearly lawful?".

The legality has not been shown but I agree our discussion is over. Time will tell whether your operation is legal. I personally think the greatest threat to your operation is the IRS but I know from your previous comments that you disagree.

If what you are doing works and is not successfully challenged then there will be many "copy cats" duplicating it and over time many Timeshares will be out of business especially the small ones who do not have the resources to fight you. -30-

It's not only the IRS that will come after him .... the attorney general in the state the scammers (socalled donation) are located will eventually come after him if enough resorts report the entity as the new socalled owner that pays no yearly maintenance fees upon taking ownership.

Obviously you are the lowest of the lowest scammers in this business and we hope potential "DONORS" stay as far away from the SHARK as possible. Timeshare Owners beware, these individuals are ruthless and obnoxious and should be in prison.

I would be glad to just give mine to someone....I have discovered that I could rent the week I own for about the same amount of money that I pay in annual fees.

What Company or charity is this?

The company is Community Health Training, Inc., incorporated in Nevada.

I will not deal with idiots spouting wild accusations, emotional or pious rants, or blatantly absurd non-documented threats of the law. We will help those who feel trapped or "scammed" by a resort and who feel they have exhausted all other options.

A great service. I'll be in touch soon.

drk14 wrote:

The company is Community Health Training, Inc., incorporated in Nevada.

I will not deal with idiots spouting wild accusations, emotional or pious rants, or blatantly absurd non-documented threats of the law. We will help those who feel trapped or "scammed" by a resort and who feel they have exhausted all other options.

I am reporting your post above to Redweek's mods as it's in direct violation of Redweek's rules .... no commercial advertising is allowed in the forums.

We seemed to have gotten side tracked in here. I started this topic because my wife and I purchased timeshares years ago. We were trading our weeks with RCI before they were taken over by a greedy entity. We used to get the locations we wanted unti RCI started selling the weeks on the open market and denying them to the owners. For quite a few years now we have been trying to sell, donate or give them away to no avail. We saw an article in a newspaper that informed us about a group called ( NTOA ) National Timeshare Owners Association. The website is nationaltimeshareownersassoc.com. The president is Ed Hastry who can be contacted at hastry@aol.com.. With the membership we received a subscription to Time Sharing Today which is their newsletter publication. They also have meetings in various states to discuss the industry. We attended two annual meetings in Central Florida so far and they were fantastic for the information we received there. In an article in a recent edition of Tims Sharing Today a member shared his experience about getting rid of your time shares. He suggested contacting the time shares and offering to give thm back. I did just that with two time shares in Florida and they both agreed to take them back through quit claim deeds. I just paid the current years taxes and a minimal fee and they are now both gone. I didn't have to pay a post card company thousands of dollars to take them off our hands and the entire proceedure only took about a month. I wanted to let other time share owners know that they are not alone in their quest to rid themselves of their obligations to their time shares. There are ways other than abandoning them or paying outragious fees to dispose of them. I would recommend that every time share owner join the NTOA. They are the only voice for the owners like us. I believe in strength in numbers.