RTU and DEED

Hi, I thought of may be buying a timeshare but I have a question of what is the difference between RTU and DEED type of timeshare? Also some people reselling their timeshare say that they have the type of membership where if I don't use my timeshare I don't need to pay the annual fees. That I pay only as I use according to the size of the room I use. Can it be so? Thank you!

A deed is that you actually own a piece of real estate, albeit just one week generally. And it goes on perpetually. With a right-to-use (RTU), you do not own it. All you really have is a contract to use it as you pay maintenance fees. They also usually have an expiry date. So an RTU contract might expire after 20, 30, 50, or even 99 years.

Either way, the idea is the same. You have a contract to pay yearly (or biennial) maintenance fees for the right to occupy that unit for the week. And yes, there are some RTU contracts that stipulate that you only pay when you use. However, some of those have clauses that every five years, or so, you have to pay some sort of a renovation fee.

Deeds and RTUs each have their pros and cons. One big plus (if you want to view it as such) for RTU is that, if you no longer want your contract, you can usually terminate it simply by stopping paying maintenance fees.

yekaterinar2 wrote:

Hi, I thought of may be buying a timeshare but I have a question of what is the difference between RTU and DEED type of timeshare? Also some people reselling their timeshare say that they have the type of membership where if I don't use my timeshare I don't need to pay the annual fees. That I pay only as I use according to the size of the room I use. Can it be so? Thank you!

In addition to the response directly above, the difference between deeded ownership and "right to use" (RTU) membership has been asked and answered many times before here in these RedWeek forums. A little search effort of these forums will easily retrieve many posts addressing this topic in considerable detail.

That observation aside, the RTU terms you describe above do not exist anywhere outside of Mexico, to the best of my knowledge and belief. RTU contracts (a.k.a. "vacation clubs") here in the U.S. invariably involve paying fees EVERY year, REGARDLESS of whether or not actually utilized in any particular year.

Personally, I still wouldn't take a Mexican RTU timeshare contract for free with five thousand dollars cash also thrown in, but that is your own choice and decision.

I have seen posts where someone said they wouldn't consider a Mexican RTU property. Why is that?

debbief189 wrote:

I have seen posts where someone said they wouldn't consider a Mexican RTU property. Why is that?

I could list a half-dozen good reasons, but perhaps the best and biggest one is that there is little or no chance of ever being able to sell and / or transfer most Mexican RTU contracts later if you want "out". Grossly overpaying for a "product" that is worthless in the resale market is also a very good reason to stay away.

Some Mexican resorts even charge a RTU contract transfer fee of several thousand dollars --- so even if you were willing to give it away for free, the parasites still want several thousand dollars just to acknowledge and process the contract transfer to someone else. Personally, I would never under any circumstances touch any Mexican RTU timeshare contract with a ten foot pole. Your mileage may vary. To each their own choices and decisions.

In my opinion, the only good thing about a Mexican RTU timeshare is the fact that the contract usually has a specific ending date built right into it. However, that date is often 20 years in the future.

debbief189 wrote:

I have seen posts where someone said they wouldn't consider a Mexican RTU property. Why is that?

Another reason for not purchasing a Méxican timeshare: they are real easy to exchange into. Mexico is overbuilt with timeshares. RCI, the timeshare exchange company, has hundreds of Mexican Resort weeks offered. Also you can rent from an owner at the resort you want to go to, without the decades-long Financial commitment of yearly maintenance fees and special assessments.

I own a Mexican RTU timeshare, GBS Casa Dorada, that is already paid off. Will it terminate the contract, if I stop paying the annual maintenance fee? Can this company in Mexico report me to a collection agency? If it's RTU, and I'm not using it, shouldn't it be okay, if I stop paying the maintenance fee?

kayb179 wrote:

I own a Mexican RTU timeshare, GBS Casa Dorada, that is already paid off. Will it terminate the contract, if I stop paying the annual maintenance fee? Can this company in Mexico report me to a collection agency? If it's RTU, and I'm not using it, shouldn't it be okay, if I stop paying the maintenance fee?

Likely your membership will be terminated if you stop paying your annual fees but not before you likely receive a barrage of collection calls and letters. The company can report you to a collection agency but their phone calls can be ignored.

Right now, they're not even allowing me to use the timeshare week, or deposit the week in Interval International, because I did not pay the 2016 special assessment fee. So, why will I pay the annual maintenance fee, if I can't use it anyway? The special assessment fee was not mandatory at that time; they offered an extra week incentive for those who want it. Now, they are saying it's mandatory. But I don't think they are consistent. I've read discussion forums that said they were told it's not mandatory.

The Divi Resorts in the Caribbean are RTU.

Some of the older contracts state that you only pay maintenance fees if you use your week that year.

With the newer contracts you pay maintenance fees if you use your week that year or not.

Right To Use (RTU) does exist in the United States. I have three RTU properties in Hilton Head, South Carolina and love them. Later if my children do not want them then I can just give them back or as previously stated quit making maintenance payments.

ken1193 wrote:

yekaterinar2 wrote:

Hi, I thought of may be buying a timeshare but I have a question of what is the difference between RTU and DEED type of timeshare? Also some people reselling their timeshare say that they have the type of membership where if I don't use my timeshare I don't need to pay the annual fees. That I pay only as I use according to the size of the room I use. Can it be so? Thank you!

In addition to the response directly above, the difference between deeded ownership and "right to use" (RTU) membership has been asked and answered many times before here in these RedWeek forums. A little search effort of these forums will easily retrieve many posts addressing this topic in considerable detail.

That observation aside, the RTU terms you describe above do not exist anywhere outside of Mexico, to the best of my knowledge and belief. RTU contracts (a.k.a. "vacation clubs") here in the U.S. invariably involve paying fees EVERY year, REGARDLESS of whether or not actually utilized in any particular year.

Personally, I still wouldn't take a Mexican RTU timeshare contract for free with five thousand dollars cash also thrown in, but that is your own choice and decision.

I own three Right To Use (RTU) properties in Hilton Head, South Carolina and love them.