I keep getting calls from timeshare "exit companies" so I can learn about ways to get out of my timeshare. Are these companies legit? If not, what steps do you recommend I consider when I'm ready to move on from my timeshare travel?
This question is all too timely, since timeshare exit scams continue to tarnish the industry's reputation and victimize thousands of owners. This type of unsolicited call is just one of many schemes that fraudulent outfits use to ensnare owners who are vulnerable to "get out of your timeshare" pitches. For the price of a free lunch at a midtown hotel, these companies also ask owners to pay several thousand dollars for their exit services, many if not all of which are illusory. RedWeek has attended several of these boilerplate operations from companies who insist they "legit." That's a red flag, right off the bat.
In addition to attending presentations from scammers, RedWeek also attends numerous sales presentations from brand-name developers and third-party travel clubs so we can keep track of what is happening to consumers in the marketplace. The scammer presentations are usually a hard-sell timeshare pitch in reverse, designed to get owners out of contracts — instead of into them. In most cases, the scammers do nothing more than pocket the upfront fee, then they disappear, change their name and create a new website to launch the scam all over again.
As a consumer-focused company, RedWeek has also written many stories to help timeshare owners avoid getting scammed by so-called "exit, transfer or cancellation" companies that offer contract cancellation services (supposedly) for owners who are desperate to dump their timeshares. Unfortunately, despite our educational efforts, these scams continue to proliferate, usually preying on older owners who are ending their travel years and eager to get out of their contracts and maintenance fees.
The Orlando Sentinel, the hometown daily newspaper for most of the major timeshare developers, just ran a long story on the industry's legal efforts to shut down exit companies that are pocketing multi-thousand-dollar upfront fees from owners who fall for their cancellation pitches — but get no relief from their timeshare obligations. RedWeek assisted with the story by providing the Sentinel with background information on secondary market issues.
This is just the latest news story, in major national publications, on the traumas that owners endure when they go outside legitimate channels to divest their timeshares Most of the time, owners don't know they've been had until long after they've already paid for exit services that never materialize.
Exit companies, who advertise heavily on Internet and radio platforms, promote the idea that timeshare owners are victims of one-sided contracts that obligate them, for life, to keep paying for their travel contracts. They offer vague legal advice and sometimes work with lawyers who paper developers with demand letters to cancel contracts. Some exit companies even offer "guaranteed" refunds that, in many cases, are impossible to collect.
In addition to participating in a new "responsible exit" program with ARDA, the American Resort Development Association, several US developers are independently filing lawsuits to crack down on exit companies that, the developers allege, are interfering with customer contracts and offering phony exit services. Developers are also encouraging state and federal prosecutors to pursue companies that take advantage of timeshare owners on the secondary market.
You Can Pursue More Legitimate Exit Options
If you need to get out of your timeshare, you do have better options available to you:
- Owners can post their timeshares for rent or sale (simultaneously) on RedWeek for six months for under $100. That's an ideal way to test the rental and resale market for your ownership.
- Owners can also list their intervals for sale or rent with real estate brokers who specialize in timeshares. (Most of the legitimate resale brokers list their clients' properties on RedWeek.com.) But brokers won't take all timeshares — they tend to focus on properties sold by the major timeshare brands, and have high commissions.
- Owners at older legacy resorts, where a local timeshare board manages the resort, should always contact their resort manager to research options for rent or resale.
- Owners at brand-name timeshare chains — Wyndham, Hilton, Disney, Marriott, Diamond, etc. — should call their owner services department to investigate exit options. Most of the majors will readily take back a deeded week at high-destination, high-value resorts. Some, such as Marriott, will buy back your timeshare for 10-15 percent of the original value. But none of these outcomes are guaranteed. They are always dependent on what you own, where you own, and whether you've paid off the mortgage on your timeshare.
RedWeek gets many calls and emails from owners seeking help in selling their timeshare. We help when and where we can. We also keep improving our site to make rental and resale transactions safe and secure for all parties. But the onus is always on owners — or their relatives — to do their homework so they make smart decisions about their travel and timeshare issues.
