can make vacationing a more affordable option for some people. However, when the expenses of the timeshare exceed your budget, or the property no longer fits your needs, selling it is an option.
Before you put your timeshare up for sale, though, there are some important things to know if you want to avoid losing money and stay out of financial hot water.
Table of Contents
The first step to selling your timeshare is reviewing your contract. You’ll need to know the details about what you actually purchased when you signed the contract, but also the rules and restrictions regarding your rights to sell the property. Some developers demand a right of first refusal, for example, meaning that you need to offer to sell your timeshare back to them first before you can list it for sale.
If you don’t have to give the developer first dibs on the timeshare, you should pull the following information from your contract:
- Details about the property: This includes the unit number, a description of the property (including square footage, number of bedrooms and baths, appliances), included amenities, and the location of the resort. If the timeshare is points-based, how many points do you have and where can they be used?
- How you access the property: Do you have a fixed-week contract where you stay in the property the same week every year, or do you have a floating arrangement? Do you use points?
- The location of the deed: Timeshare arrangements vary, with some properties issuing deeds to timeshare owners, while other contracts stipulating that owners only have a right to use the property. Right-to-use arrangements are more common outside of the U.S.; in Mexico, for instance, timeshare property owners are prohibited by law from owning deeded property within a certain distance of the border or ocean. Knowing your deed situation is important when selling the property, and if you are a deed holder, you need a physical copy of the document.
- How much you paid: The amount you paid for the property influences the asking price and your break-even point. Keep in mind that timeshares tend to lose value quickly, and the amount you paid may not be what it’s worth today.
- How much you owe: If you have a mortgage on the timeshare, it will likely be more difficult to sell, as it will be listed as encumbered. Buyers will also be wary of your timeshare if you have unpaid fees for maintenance, dues, assessments and other incidental expenses.
Again, the current value of your timeshare may not be the same as what you paid for it, and may even be significantly less than what you paid. And if you still owe money on it, the timeshare may be worth even less.
Determining the market value of your timeshare starts with the company that manages the property. Inquire about the recent selling prices for other units, which will give you an idea of what you might expect. Again, different factors, such as the week you purchased and the location and features of your specific unit can influence price, but the management company should be able to provide information about similar units.
You can also get an idea about the value of your timeshare by checking out timeshare marketplaces such as RedWeek.com and Time Share Users Group. You may find properties at your specific resort, or similar properties, listed for sale, giving you an idea of what other owners are asking for their timeshares. Again, don’t expect to make money on the sale, since timeshares typically lose value. Instead, selling should only be viewed as a means of eliminating the associated expenses from your budget.
There are several options for listing and selling your timeshare.
- Transfer to the resort: Some resorts are willing to take back the timeshare. They may resell it (taking some of the proceeds as commission) or just retake ownership without changing any money. However, proceed with caution, as your resort may attempt to entice you to stay with all manner of tempting offers, most of which will cost you more in the long term.
- Sell it yourself: Unless you are familiar with the complexities of selling timeshares, this isn’t typically recommended. You will save some money on commissions and fees, but the headaches and hassles of navigating the sale aren’t likely to be worth it.
- Work with a listing company: Listing companies employ real estate agents who are experts in the timeshare market and have the knowledge and experience necessary to facilitate the transaction. Scams run rampant in this industry, though, so do your homework and choose a listing company that has proven experience, references, and a good reputation with the Better Business Bureau and American Resort Development Association.
- Use a timeshare exit company: A timeshare exit company isn’t a listing company or real estate agency, but rather a business that focuses on helping consumers find legal ways to exit their timeshare contracts. In most cases, this includes identifying loopholes in the contract, or misrepresentations made by the developer, that allow the owner to cancel the contract. Timeshare exit companies charge high fees, but the final cost is much less than what you will pay on the timeshare contract, and they are a good option if you are struggling to sell your timeshare.
If you decide to sell your timeshare yourself, keep these tips in mind:
- You will not be able to ask what you paid, and you may need to offer the timeshare at a significantly reduced price; some owners offer their weeks for as little as $1 just to get out of the contract.
- List the timeshare on multiple listing sites. Don’t overlook sites like Craigslist or Facebook Marketplace, either.
- Ask your friends and family to spread the word about your listing.
- Don’t rule out local buyers. Some people purchase timeshares near their hometown so they can use amenities or take “staycations.” Advertise your timeshare locally as well.
- Compare your week/property to others listed for sale, and set your price on the lower end of the price range for comparable properties to make a quick sale.
- Be prepared to pay off your mortgage or back fees before selling. Buyers aren’t likely to want to take over your payments.
- Consider offering to pay closing fees to entice buyers. An attorney can also assist with the sale, but the fees may be more than you make on the sale.
- Use a professional closing company to handle the paperwork associated with the sale.
- Continue paying fees that are due to the management company until the title is fully transferred and any applicable fees are paid.
- Be patient; selling a timeshare can take up to 18 months.
Once you list your timeshare for sale, it’s likely you’ll be contacted by multiple companies offering to get you out of your timeshare contract and sell it for you. Unlike a listing company or timeshare exit company, which work with you to find the best way to unload your timeshare, resale companies often charge a flat fee with the promise that they will sell your timeshare for you. Some may even claim to have a buyer already lined up and waiting for your property, or they’ll make guarantees about sales prices or timeframes for the sale.
If you are struggling to sell a timeshare yourself, or are desperate to get out of a contract, these promises can be appealing. However, if a company approaches you with an offer to get you out of your contract, charges high fees upfront, and makes promises that sound too good to be true, walk away. The fact is legitimate companies don’t cold call potential companies, and although some charge a nominal fee for service, none will promise to sell your timeshare for a flat fee or accept payment until the transaction is complete.
That said, working with a legitimate timeshare resale company can help you sell your vacation home. If you choose this route, go with a reputable company that doesn’t charge upfront fees and sets realistic expectations.
Image Source: https://depositphotos.com/
Want a FREE Credit Evaluation from Credit Saint?
A $19.95 Value, FREE!