Frequently Asked Questions (FAQ)

Timeshare Frequently Asked Questions

Timeshare is not a new concept. However, members of the public still have many unanswered questions about timeshares and their benefits. Here are some of the many questions people ask about developer timeshares and also resale timeshares in general.

Question 1: What is a timeshare? 

A timeshare is a fractional ownership of a real estate property. Especially vacation properties. Ownership is usually in weeks or points (which can be equated to weeks for varying seasons). This type of ownership grants the owner certain rights of usage and privileges for the time period assigned or owned.

Question 2: How is a timeshare property utilized?

All Timeshare properties are associated with a timeshare exchange company to provide their owners or members with the option of exchanging the week  they own with another resort, which may be located anywhere around the world. The two most popular exchange companies are RCI (Resort Condominiums International, rci.com) and II (Interval International, http://www.intervalworld.com/). They have a combined total of over 7,000 resorts for members to exchange their deeded week with around the world.  Each exchange company charge the owner an annual membership fee and an exchange for the use of each deposited week.  You must be a timeshare property owner in order to use their services. However, if one takes their vacation at their home resort every year there is no need to join a timeshare exchange company and pay additional fees. As a matter a fact, some timeshare companies have their own internal exchange program.

 

Question 3: How is your vacation property cared for?

Each week of ownership is assigned a resort fee by the condo or resort developer. This is used for the maintenance of the timeshare property and also as a reserve for major repairs. Minor repairs are covered by your annual maintenance fees. The weekly assigned fee is paid by the deeded owner of the timeshare property. This fee amounts to far less than what one would pay for a week stay at the same resort or even at a hotel of the same star value.

Question 4: How many weeks can a person own?

A person may own as many weeks as needed at the properties of their choice. Timeshare ownership is somewhat similar to home ownership. Timeshare ownership are deeded for life or owned with an expiry date of ownership (for example, 50 years from date of purchase). It is better to own the deeded property so that it can be transferred to children or love ones in a will or in the case of estate planning.

Question 5. How do I pay for a resale timeshare property?

As a rule, whenever a person decide to purchase a Resale Timeshare, a contract is sent to the purchaser their signature after some verbal or written commitment is made. After a down-payment is made as consideration, the funds are  forwarded to a timeshare closing company where they are held in escrow (in trust) until the purchaser and seller are completely satisfied. The transaction is then completed and the property transferred from the seller's name to the buyer's name and all pertinent information recorded in the jurisdiction, county or borough where the property is located.
The timeshare closing company ensures that:

a)      The seller is paid after the transaction is completed

b)      The respective county or borough legal and /or recording fees are paid

c)      Title searches are done and that the county or state register the deeded property in    the purchaser’s name

d)    That all taxes and mortgage for the timeshare property are clear so that purchaser receive a  clear title bearing no liens

e)      The resort is paid for any Resort Transfer fee

f)        All outstanding  maintenance fees are paid, if any 

Question 6. Is renting a timeshare better than buying one?

Buying a timeshare gives you much better choices. As an owner of a timeshare you get
better amenities and discounts on lodging, entertainment, food, travel and tours. As a
general rule your maintenance fee could range from about 20% to 50% of the equilavent the
going weekly rate of the property you owned at. If you take a holiday every year, this is a
significant saving. Even if one own bi-annual even or odd year this is a significant saving as
well.

Question 7. Is buying a timeshare good investment?
When one purchase a timeshare from a developer, at least 50% of the cost of the
timeshare is for marketing and other developer charges. Hence, to buy a timeshare as an
investment is  not worthwhile. A timeshare should be seen as an investment in life or
family,  providing guaranteed vacation properties with great facilities. A timeshare
ownership may also be viewed as an indirect investment over a period of time because of
the tremendous amount of money a family would save if they had to rent or use an
equivalent resort property on an annual basis.


Question 8. Can a person rent their timeshare to a friend or anyone else?
Yes. Any legal owner can rent their timeshare. All resort allows this and would like
notification that you have given such renter permission to use your timeshare. You can also
rent an exchange week if you pay the exchange company a guest fee. Since you will be
sending a friend or a renter there and you will not be staying at the property for that week
a guest fee applies.

Question 9. What is the process for exchanging my timeshare?
First you deposit your ownership week and then you are allowed to exchange, that is, take
someone else's week which they have deposited. In other words you give up your week to
use another person's week. You week will be worth more or less depending on the unit
size, resort location and the season of the week you own. The demands for these seasons
are designated by colors. Seasons are designated as red, white, blue (RCI) or Red, yellow
and green (Interval). If you own a lock -off unit you may also be able to get two weeks
for your one week ownership, depending on how you make your week deposit. Contact
Interval International ( 800-843-8843) or RCI (800 338 7777) for more specific details. They
are normally quite helpful. For the most part, you will be able to get an equivalent unit for
what you deposit.

Question 10. What are fixed week and floating week?

For a fixed week you are entitled to use your timeshare only at a specific week eachyear.  In a floating week ownership you have the option of choosing any week in your
floating time on a first-come-first-serve basis.


Question 11. How does timeshare points work?
RCI uses a points system for some of their timeshare properties. In a points system, a week
of ownership is assigned a  RCI points by the developer.  The owner who owns these
points may use them for a full week or a partial week exchange,  through RCI, to stay at
many resorts internationally. Points ownership is more flexible than a fixed week
ownership. RCI can provide a lot detail of information on how their points system work.
Their point line is 877 968 7476. Other timeshare developers also has a points system.



Question 12. Should you pay an upfront fee when buying or selling a timeshare 
through a broker?
Definitely not. The answer is strict no.  Never pay an upfront fee to buy, sell or rent
timeshare. Keep in mind that when you are purchasing a timeshare, you will have to pay a
down-payment. Do not confuse this with a broker upfront fee. Like any other industry,
the timeshare industry is also prone to many con-artists, scams and frauds. There have
been instances where people paid a huge upfront fee, only to receive empty promises and
nothing in return.  Just like anything else... Buyer beware.

More Questions?

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