Time-Shares: Big Deal or Big Regret?

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RISMEDIA, Jan. 23, 2008-(MCT)–It’s hard to walk around any resort community without meeting them: overly friendly people offering free or deeply discounted stuff, from glass-bottom boat rides and Jeep rentals to fancy dinners and show tickets.

Ninety minutes of your time is all they want. It won’t cost you a thing. That’s a promise!

They’re pitching vacation time share deals, and they must be very good at what they do since they sell $10 billion worth per year in the United States. In 2006, nearly 538,000 time share “intervals” were sold for an average price of $18,502, and the industry continues to grow.

About 4.4 million U.S. households own one or more time shares, but many of them had no intention of buying before attending a sales presentation. They simply went for the freebies.

“I was just going to go up and get the goodies but not buy,” said Ray Dahlgren of Modesto, California, recalling his first visit to a Squaw Valley time share resort about five years ago. “I ended up buying what I thought was a good deal,” Dahlgren said. “They just talk, talk, talk until you buy. If you’re weak at all, they’ll get you.”

Dahlgren spent $7,000 for the rights to use a studio condo near Lake Tahoe, but it wasn’t until later that he realized he could book it only one week every other year. He’s never used it, and he hasn’t been able to sell it.

Worst of all, Dahlgren borrowed money to pay for it. “I’m getting charged an outrageous interest rate, like 16 percent or something,” he said.

Dozens of others, however, told how pleased they’ve been with their time shares.

What they all agree on is that potential buyers should do their homework, ask many questions and not get rushed into signing any contract.

“This is a big investment. Take time to educate yourself so you have no regrets later,” advised Christine Gosselin of Modesto, who has happily owned time shares for 10 years.

“Find out all the info you would if you were buying a house or car,” Gosselin said. “Such as: insurance, financing, where does the company keep their funds, are those funds insured, tax advantages, do they offer bonus time, do they allow pets, plans for growth, are the properties owned outright or have loans attached to them, location, location, location.”

Most important: Do your math before buying to determine whether you really can afford the upfront and ongoing cost of time share ownership, Bee readers stressed.

Dottie Starr of Modesto wishes she had done that before agreeing to spend $22,500 on a deal from WorldMark by Wyndham, which has more than 50 resorts.

“I’m extremely disappointed I’m stuck with it,” said Starr, 69. “I’ve wound up being financially strapped.”

The company arranged financing for her, and even though she’s been paying about $320 a month for the past three years, Starr said she still owes about $20,000. Atop that are annual maintenance fees that keep climbing.

Starr said she can’t sell her time share, can’t rent it and can’t find openings at vacation spots she wants to go to at times she can use. She thought she was buying enough “credits” to enable her to stay at resorts around the world for four or five weeks a year, but she’s only been able to take three trips to Las Vegas.

“I listened closely. I took notes. I asked a ton of questions” at the sales presentation, Starr said. But she didn’t research how much everything would end up costing or how seldom she would be able to travel. “It’s all my fault.”

Salespeople will hook you

Many people told The Bee that time share salespeople are very persuasive and the financial details they present are so complex that it’s easy to get confused.

Ginger Merrill of Modesto warned that time share “salesmen are the best of the best,” and that they make verbal promises that don’t end up being written into the contract.

“Our first experience at a time share presentation proved to be very costly. We had no idea what we were up against. For a $75 dinner coupon, we paid $11,500 for a one-bedroom, 900-square-foot unit overlooking the ocean for one week per year. (That was) by far our most expensive dinner!”

Buyer’s remorse kicks in for many people who buy time shares.

Josephine and Richard Flynn of Escalon signed a time share contract for more than $20,000 last June while visiting Marriott’s Timber Lodge at South Lake Tahoe. They said the salesman convinced them there was no downside to the deal because Marriott would buy the time share back from them if they changed their minds.

“There’s so much paperwork and it’s confusing,” Josephine Flynn said. About a week after their purchase, they realized that paying $311 a month for their time share loan plus $700 a year in maintenance fees “was just a poor investment.”

So the Flynns told Marriott they wanted to sell it back, because they had been promised verbally that they could. They said they initially were offered $13,000 but later were told Marriott wouldn’t buy it back.

“We’ve tried to get hold of the guy who sold it to us, but we can’t,” Flynn told The Bee. “It’s hard to find out who to talk to.”

Selling it back isn’t easy

On the Flynns’ behalf, The Bee contacted the Marriott Vacation Club International Tuesday to relay the couple’s situation. Marriott agreed to look into it, and Thursday the company responded.

“We were able to contact the Flynns, and we’ve made a decision to buy back (the time share contract) for nearly the full amount,” said James Woelbern, Marriott’s senior manager for brand public relations. “We believe it’s the best situation for everyone involved.”

“That’s absolutely wonderful,” Richard Flynn said after hearing the news.

But not everyone is able to unload unwanted time shares so easily.

Several readers told The Bee they’ve tried to sell their time shares for years with no luck. Selling time shares also can be expensive because sales agents charge owners in advance — typically about $500 — to list the property for sale, with no guarantees that it will sell, or for how much.

Many owners try to sell their time share contracts via the Internet on sites such as eBay, which last week had more than 1,000 of them up for bid with prices starting at $1.

Often those listings don’t attract any bids. Sometimes they sell for a few hundred dollars. Occasionally, time share contracts with guaranteed access to prime locations will sell for thousands of dollars.

Reselling time shares usually doesn’t pay off for those trying to get out of contracts, but they can be great deals for buyers.

“We purchased a two-bedroom floating week time share that we are very happy with for $2,200 (in Newport Bay, Ore.). The original price was $16,000,” said Ed Washington of Modesto.

“I kept watching for sales on eBay. I purchased a biennial one-bedroom deluxe floating week time share (at Lake Tahoe) for $477.

“My next purchase was for a one-bedroom townhouse floating week at (Lake Tahoe) for $100, purchased again on eBay. There are other sales sites on the Internet, but I have had the best luck with eBay.”

Washington said the key to getting a good deal is to be patient and do research.

“You see a lot of time shares for sale in November and December. With most resorts, the maintenance fee comes due in January, and people want to sell them before they have to pay another fee,” Washington said. “However, you will find them available all year long.”

Points work for some but not for others

Some time shares are sold for use during certain weeks during the year at specific locations. Others have weeks that can be used year-round at various locations. Some time share companies sell “points” or “credits” that can be redeemed for stays of varying length at various resorts.

“Point sales are pushed over weeks. They allegedly allow you more flexibility in scheduling time,” Washington said.

“One of the other selling points is the ability to trade and stay at other resorts. You have to be a member of the trading group, and there is usually a fee to that. The fact that you are also charged a fee when you actually make the trade may not be mentioned, and if it is, it is glossed over really quickly.”

Resort Condominium International and Interval International are the big trading groups.

“Some people are quite happy with their points, I have not been. I have never been able to use my points for a location or time I actually wanted,” Washington said, adding that he settles instead for visiting resorts with openings. “I will admit that the week I spent in the obscure Canadian fishing village was pleasant, enjoyable and one of the best vacations we’ve had.”

Howard Black of Salida has had better luck manipulating time share trades, which enables him to vacation around the world.

Within the past year, Black said he has used his time share points to pay for a flight to Europe, a Caribbean cruise and resort stays in Hawaii, Lake Tahoe and at a mountain fishing resort. He’s booked his next big trip to Australia.

“You’ve got to learn how to work the system,” Black said.

Copyright © 2008, The Modesto Bee, Calif.
Distributed by McClatchy-Tribune Information Services.

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