Let’s start with the biggest question! There are all sorts of reasons as to why timeshare went wrong… and it is a great shame, as the original concept of timeshare was truly innovative and it did largely deliver on its promises through the timeshare “boom times” from the mid 1980s into the 1990s.
However, due to the lack of regulation, the rather one-sided way that timeshare contracts have been written, the pure greed of a number of the timeshare developers/resorts and the major economic downturn in recent years, the timeshare industry finds itself in dire difficulty.
The real victims of course are timeshare owners, those people who bought into the idea of timeshare and now find themselves locked into long-term contracts, paying hugely inflated fees that increase year-on-year, for a holiday concept which no longer delivers what it promised due to overselling and freedom to book online as a non owner causing a lack of availability.
Why do I have to pay timeshare maintenance fees?
Virtually all timeshare agreements include clauses relating to maintenance, management or similar fees that must be paid throughout the full contract term and (here’s the catch…) these fees can be varied entirely at the discretion of the timeshare developer/resort.
There are many different types of timeshare contract, but the fees are generally charged on the premise that all the “members” of a particular resort or scheme are collectively contributing to the ongoing upkeep and management of the resort/scheme.
The problem is that most timeshare developers/resorts became greedy over the years and simply couldn’t resist taking advantage of this, so they have kept finding reasons to increase the fees they charge their (literally) “captive audience” of owners, who are usually locked in to long-term contracts and have no option but to just accept these increases.
Why do timeshare maintenance fees keep increasing?
The maintenance fee clause in a timeshare agreement is the “Trojan Horse” hidden away in the small print, which allows the timeshare developer/resort to change (i.e. increase) the fees at their discretion.
Unfortunately, because you have signed a contract agreeing to this and, whether you realised it or not at the time, you are legally obliged to pay these fees throughout the full term of your agreement.
This situation is all too tempting for many timeshare developers/resorts , who have become used to simply pushing the fees up year on year – and this habit shows no signs of stopping. There are exceptions of course but, as a general rule of thumb, it is estimated that timeshare maintenance fees double every 10 years. Therefore, if your fees were £400 this year, they are likely to have paid in total £13,887 in 20 years’ time.
The 2023 maintenance invoices are currently being issued, the normal we have seen is a rise of around 20%, however at the extreme, one Scottish based developer has increased fees in their UK resorts by 30% and in their Spanish resorts by 40%.
Work out your potential fees with our timeshare maintenance fee calculator.
What happens if I just stop paying timeshare fees?
This will depend on your timeshare contract and the specific timeshare developer/resort, but if you refuse to pay your timeshare maintenance fees, the likelihood is that the timeshare developer/resort will put you into their Credit Control process.
This is likely to include an escalating sequence of events, starting with reminder letters/phone calls and sometimes additional charges and/or interest for late payment. You may also suffer restrictions in terms of using, exchanging or renting out your timeshare while you remain in arrears.
Fees will usually continue to accrue and the recovery procedures may escalate, with threats of legal action, damage to your credit rating and the use of Debt Collectors – For example, Daniels Silverman who are known to act on behalf of some timeshare developers/resorts in this way.
The whole process can be a very stressful and unpleasant experience and, ultimately, the timeshare developer/resort has a signed contract and they can enforce this as they see fit, so we would not recommend this course of action.
What will my maintenance fees be in the future?
The one certainty about timeshare is that your fees will increase over time!
The timeshare developers/resorts know all too well that they have you locked into contracts which allow them to increase the fees at their sole discretion… so most of them do.
Depending on the term of your contract, this could well mean that you are committed to major financial liabilities over time.
Work out your potential fees with our timeshare maintenance fee calculator.
Why can’t I book my holidays where I want & when I want?
Along with the high maintenance fees and the collapse of the resale market, the lack of availability is one of the major frustrations among timeshare owners and, like a number of the other problems with timeshare, the greed of the timeshare developers/resorts is sadly the root cause.
The relentless sales drives of these organisations over time has meant that many Resorts & Point Schemes are hugely oversubscribed, which means that only a very small proportion of the members are ever lucky enough to be able to book their first choice accommodation & dates.
This is exacerbated by the fact that some resorts, developers and exchange networks are known to hold back some of the most desirable accommodation and dates for sale on the online booking platforms, rather than sharing the full allocation fairly across their fee-paying membership.
On top of this, there is often a further allocation of the best units/dates held back for new potential enquirers, who are flown in for a few days so the sales teams can try and sell them into the prevailing special timeshare scheme of the moment.
It all means that the actual fee-paying members/owners, who have bought into their timeshares and dutifully paid their maintenance fees, are often pushed to the back of the queue and generally find themselves having to choose from what’s left over.
Why can’t I sell my timeshare/points?
Whilst there are a handful of exceptions, it’s a sad fact that the vast majority of timeshares are simply impossible to sell now.
The salesman’s promise that timeshare was a great asset that may even increase in value over time has proven to be entirely false, especially as holiday styles have changed over the years’ and timeshare is out of vogue.
Timeshares are frequently advertised on eBay for £0.99p, but even then, no-one wants to buy them for the obvious reason that the purchase price is of no consequence when compared with the associated fee commitments over the term of the contract. Rather than buying something for next to nothing, the buyer would therefore have to take on the future liabilities for increasing fees over many years to come, which represent a commitment of thousands of pounds, depending on the contract term.
Some timeshare Developers insist that any attempt at reselling a timeshare is conducted through a specific resale company but these companies generally charge open-ended “listing” or advertising fees. With virtually nil chance of success, it’s just another fee to add to the list. We have enquirers coming to us every day who have spent years, and sometimes a lot of money, unsuccessfully trying to sell their timeshares.
It‘s of course heart-breaking to come to the realisation that your timeshare is not only worthless, but a growing financial burden. However, in the vast majority of cases, this is the sad reality and you may need to think about how you can get out of your contract to avoid further fees.
Why can’t I sell or give it back to my timeshare developer/resort?
Quite simply, whether or not some sort of buy-back option was loosely promised to you in the past, it is not in the interest of the timeshare developer/resort to take the timeshare back from you. If they did this, they would effectively be “letting you off” the maintenance fees that you would otherwise be liable to pay over the rest of your contract term, which may well be worth thousands of pounds to them.
It is also important to remember that timeshare is an abstract concept, and is now even more so than in the past, as many people have been moved over to points schemes, fractional ownership, floating weeks and similar variants.
This means that, to create a new timeshare contract to sell to a new member is purely a matter of raising some paperwork, as the timeshare developer/resort do not need to have a timeshare that they have taken back from you or another member “in stock”. They can just sell a package of points to the new member and add to the over-subscription.
What does “in perpetuity” mean?
The literal translation is “forever” and some timeshare contracts were sold “in perpetuity” in the days when timeshare sales developers were pushing the idea that, along the lines of property, timeshare was a long term purchase, which should be protected for you and your family so no-one could take it away. How times have changed!
This means that, if your timeshare contract was sold “in perpetuity”, the intention is that it would stay in your ownership for the whole of your life, then pass on to your children, then your children’s children and so on.
It is likely that this was put forward as a benefit when the salesman was presenting the timeshare opportunity to you – but you will no doubt be fully aware of the downside now that you and your family face the prospect of relentlessly escalating fees liabilities possibly forever.
There are some intricate legal and technical considerations around perpetuity which we would be impossible to fully explain in a few lines on the website so, if you have concerns or questions, please call us
Will my timeshare liabilities pass to my family when I am gone?
This depends on the timeshare developer/resort, the specific terms of your contract and certain rather technical legal considerations – but the timeshare would usually form part of your Estate and pass onto your descendants accordingly.
Were you passing on a valuable asset, such as a house that you owned, this would normally be considered a good thing of course but your timeshare contract is almost certain to be a liability, due to the increasing maintenance fees attached to it over the course of the contract term.
We are frequently contacted by enquirers for many this is a key consideration and for whom it is important to be released from their timeshare contract precisely to prevent it passing on their children. Similarly, we frequently hear from people who have inherited timeshares and have only more recently come to understand the associated fee obligations.
Can I cancel my timeshare?
This is a good question, there are but a handful of timeshare developers who have a published exit strategy and even those who do often charge considerable multiples of the annual maintenance fee to allow the exit. In other cases the terms to be “considered” for exit are totally prohibitive. Worse still there are developers who out and out state that they have no formal exit strategy.
Because of the general intransigence of developers to allow exits, more and more exit companies have sprung up. At this juncture, a word of warning, there are more fraudulent exit companies than bona fide organisations so be on your guard.
In general you may expect the process of cancelling a timeshare contract to take from 3-6 months, but there are exceptions of course. In some rare cases there will be a specific set of conditions which enable the exit company to conclude the cancellation much quicker than this. In some cases the process can sometimes take longer if the case is more complex or if the timeshare developer/resort in question is known to be more obstructive than others.
Can I claim any money back?
As this area is quite complex there is no simple answer. There are certainly circumstances and contracts that due to legislative changes may be challengeable in a court of law. This especially may be the case with Spanish timeshare that was purchased after January 1999. Expert advice will be required, please contact us for further information.
Can I stop paying the finance?
Finance payments need to be paid until advised otherwise by a lawyer following a court ruling or a decision of another state authority, e.g. The Financial Conduct Authority (FCA). In all other cases non payment may have serious repercussions and for this reason is not recommended.
It should be remembered that finance for timeshare is just the same as any form of unsecured lending and is not really dependent on the product. If you are able to exit or cancel your timeshare this will not cancel any requirement to settle the outstanding balance of the loan.
TCA comment
We published an article pointing out that timeshare is only a means to an end to get a holiday after all, so why is it so full of pitfalls when compared to any other holiday product? The reality is that all the average family want to do is get away for a week or two and relax, chill and engage in some quality family time. Buy your flights, book your accommodation get the spending money together pack the suitcases then off you go.
Would we be wrong in saying most people don’t want endless hours of trying to book a holiday when every time something suitable turns up either there is no availability or the timing is wrong. Why if you want to holiday in Florida the resort is full, why when you want to go in July, the earliest vacant date is October, welcome to the world of timeshare ownership.
Factor in a long term contract, annual rising contractual maintenance fees pile on availability problems and you rapidly come to the conclusion that timeshare is not all it’s cracked up to be.
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