Timeshare contracts can trap owners in such a way that even death won’t allow an escape route. It is well known that an owner may be stuck in a timeshare trap for the rest of their life but it isn’t as common knowledge that its hold may stretch even further than that.
In the case that there is a joint ownership and there is a remaining spouse then that spouse will assume responsibility for the timeshare and its liabilities. However, if you are a single timeshare owner, the timeshare would be passed on to your estate. This article reveals what would happen in that circumstance.
The Perpetuity Clause
In the case of a single timeshare owner passing away, the remaining balance of the term of the contract or if the agreement is in perpetuity it would be passed onto the deceased’s estate to inherit. The estate would then be liable for any outstanding maintenance fees and possibly future annual maintenance fees. This in turn would be a detrimental financial burden to the estate.
The value of estate would be reduced depending on the above liabilities.
Declining Timeshare Inheritance
In some cases, provided the resort still operates, the estate could be relieved of the timeshare and its liabilities. To do this, all maintenance fees usually have to be paid up to date and it is necessary to send a letter to the resort informing them that the owner has passed away and the timeshare will no longer be needed. However, in the event that the children were the inheritors for example, most people in the situation of their parents passing away are not likely to have timeshare at the front of their minds.
If the resorts terms are met, the permission to decline should be granted. Once granted the decision is final and cannot be undone. If the resort doesn’t want the timeshare returned to them then the liability will pass on to the next beneficiary in line, presumably another family member.
In the case that the resort does not accept the estates written disclaimer to decline the timeshare, which some resorts do go down the line of pursuing, an amicable solution has to be agreed. This is a worst case scenario path to go down, in many situations the resort will take back the timeshare without putting up too much of a fight but be aware that this could be a possibility and it does happen. If the inheritor accepts the timeshare from the estate they would be in the same position as the deceased and would therefore have to comply with the resort’s exit policy.
Other Solutions
As an owner, the safest option for the future of your estate in regards to timeshare ownership would be to find a way to exit from the agreement while it is still in your name. It is a difficult situation, as the contracts are designed to keep owners locked into the timeshare for longer than a lifetime but it can be done. With the right advice, assistance and in some cases legal representation on your side it is possible to escape the fate of your timeshare.
Many owners looking for ways out of their timeshares are now consulting the services of a compensation lawyer to investigate whether their timeshare was correctly sold and the terms within their contract are compliant with the laws of the land. For example, if contracted in Spain, the timeshare company was not allowed to sell an ownership that has a duration period of longer than 50 years, take any form of purchase payment during the cooling off period and in all circumstances the timeshare week sold must have its own land registry number detailed in the contract.
If you are a timeshare owner and any of these terms were breached along with purchasing the ownership after 1999, then you could be one-step closer to receiving a substantial amount of financial compensation. For all you know you could have a claim worth thousands, but you won’t know until you start looking into it.
Please note that the sale of a timeshare by points or fractional are not compliant with timeshare legislation, including the taking of any monies during the cooling off period.
The bottom line is that the inheritance of a timeshare can be seen both as a blessing and a curse. This less spoke about subject is well worth investigating in order to make an informed decision for yourselves and next of kin.
For more information regarding this article or assistance in any other timeshare related issues please contact the TCA on 01908 881058 or email: info@TimeshareConsumerAssociation.org.uk