Caught Between the Devil and the Deep Blue Sea
For nearly 24 years the TCA has been offering assistance and solutions to timeshare owners who experience problems or have queries in relation to their ownership. We can honestly say that up until recently we have pretty much stood alone. One or two other organisations have come and gone but we are still here. If we had to do an audit of the main antagonists within the industry, we would establish that the top three reasons why we are contacted by timeshare consumers would be maintenance fees, inflexibility and the thorny matter of exiting unwanted contracts.
Life changes regularly for most of us and personal circumstances dictate how and what actions need to be taken for going forward. Unfortunately the intransigent management of most timeshare companies do not seem to recognise this human factor. What was a good purchase ten years ago may now be a massive burden and death, divorce, unemployment will all lead to a review of our personal circumstances. From what we gather, whilst banks, mortgage companies and the like, usually offer a listening ear, timeshare companies seem to be deaf. So it was with interest that we stumbled across a brand new website entitled “Timeshare Exit Concerns”. At last we thought, another likeminded organisation has been established to relieve us of some of our enquiry burden, but no, this site turns out to be just another blog financed by the Resort Development Organisation (RDO).
The primary function of the RDO is the expansion of the timeshare industry. Consequently owners leaving in their timeshare in droves will hardly help the resorts and timeshare companies to develop. So it does seem a bit perverse for the RDO to fund what appears to be a timeshare exit oriented company. Upon further inspection of its content, it seems to bang the same old drum of slating companies that have long since ceased and impossible to seek retribution.
Monster Travel and associated companies, including SellMyTimehare.tv, which are the subject of ongoing police investigations. (Note later businesses started by the same people include ABC Lawyers, Timeshare Lawyer and Jive Hippo.)
EZE Group – closed down after a successful criminal prosecution in 2017, with the two principal executives receiving prison sentences.
RSB Legal – Closed down after numerous complaints made by consumers. The liquidator has so far reported that 90 creditors (the majority RSB clients) who have filed claims totalling nearly £1 million – and that the directors did not maintain accurate accounts in these matters.
Tell us news not history!
Our question would be “what about today’s owners desperate to get out of their long term contracts?” Surely assistance or comment here would be worthy of an organisation that purports to be in existence to help timeshare owners exit.
Back in 2014 the RDO acknowledged that there was a need for member resorts and companies to agree to a mandate to allow exits. At that time the then Chief Executive, Paul Gardner-Bougaard had this to say:
“This is very much a legacy issue in that it relates back to timeshare products bought in the 80’s and 90’s. It is considered a legacy problem because those early buyers were signed up to either 30-year or in-perpetuity contracts, and found it difficult to get out of them when they reached a stage in life where travel was not possible any longer. Back during the time of purchase, they did want to seek out the time of purchase, they did want to seek out ‘own’ assets then.
That has changed. Today’s Millennial buyers are looking for more flexibility, reduced financial exposure and are much less likely to find a long term commitment an attractive proposition than their baby boomer forebears did.
Most, if not all timeshare products, sold today are offered on a much shorter term of ownership. Typically sold as three-, five- or ten-year ownerships or memberships, they are now sold with a definitive end date to the ownership contract.
‘Try before you buy’ or offering mini-breaks and, say, three-year memberships are ideal ways of allowing potential buyers to sample your brand experience, giving you the opportunity to upsell to those strong sales leads.
To deal with the legacy issues for early owners, RDO has introduced a solution by setting out ownership exit criteria for owners at RDO member resorts.
Owners can walk away where:
• One spouse/partner dies and the other no longer wishes to continue with the timeshare and the next of kin and/or siblings do not want to take it on.
• A sole owner dies, and the above provisions apply.
• An owner, or either of the joint owners, is suffering ill-health and is no longer able to travel to their home resort.
• Personal bankruptcy has occurred and, in addition,
RDO recognises that any owner can at any time apply to exit, subject to the permission of the developer and/or the membership club.
• The RDO member resort imposes a charge to allow the owner to exit, that cannot be more than three times the annual maintenance fee. A large number of RDO member resorts will automatically grant exit to their long-standing owners, as long as they are up to date with their maintenance payments.
As a developer of any shared-holiday ownership business, you must look upon your exit strategy as an entry strategy, because without a properly structured process for owners to hand back their timeshares when circumstances dictate, potential buyers will be reluctant to commit to that contract.”
So from this we can gather that unless you are dead, nearly dead, bankrupt or that a beneficiary does not want it, then tough luck you are stuck with your ownership! Furthermore the statement says you need permission from the developer, what if they say no? To be fair it does say that if you are a long term owner you can apply for an exit, however the question is “how much penal servitude must be endured before you are classified as long term?”. Note the statement that confirms that any owner may apply for an exit at any given time. Why should you have to make an application? Why can’t you simply tell your resort that you want out?
The final icing on the cake is that a fee of up to three years maintenance fee will be required to be paid once the resorts developers have agreed your application. As an aside, MacDonald Resorts, who are not an RDO member, have adopted these guidelines except they want four years maintenance and they do not care about your age, health or welfare, either you pay it or you stay put!!
If this is the best the RDO can offer one is to assume that Timeshare Exit Concerns are only able to replicate the rules set out by their lords and masters.
A while back we reported on a timeshare company doing it right, the Canal Boat Club. They charge an initial purchasing fee; the same as RDO members. They charge annual maintenance fees, that same as RDO members. But unlike RDO members, they do not charge three years maintenance for timeshare freedom, instead they charge a £150 flat fee. There is no need to apply for permission and the process can be completed at any time. If they can do this then why can’t RDO members?
So here at TCA it appears that we remain the only organisation attempting to stand the corner of timeshare owners, what a shame because it would have been good to have a fellow partner who believed in the same ethics as we. Maybe one day who knows!!!
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