Buying a Timeshare Usually Isn’t the Best Route to Great Getaways
Last updated April 2020
Many people enjoy their timeshares, including some owners we interviewed for this report. But even happy owners also agreed that timeshares aren’t the best choices for most vacationers. There are plenty of reasons why a timeshare shouldn’t be on your shopping list:
Buying and using a timeshare takes a lot of know-how. Even after doing your homework, you may not end up with the vacations you’ve been dreaming about—or were promised during sales pitches. “It is a vastly complex product. You can spend a week looking at it, and you still won’t have a grasp of the timeshare industry,” says Brian Rogers of the Timeshare Users Group. Those who buy timeshares often don’t do much, if any, research, says Rogers.
There are different types of timeshare arrangements, and within each are many options that you’ll have to navigate when making your purchase and, often, later on when planning your stays. You’ll have to decide, for instance, whether to buy an interest in a specific unit at a fixed time of year or a floating week that you can use any time, assuming it’s available when you want it. You’ll also have the choice of purchasing a points-based timeshare, or vacation club, that gives you a variety of options beyond just spending time at a condo-like resort, such as booking a hotel stay or even taking a cruise. The formulas resorts use with their point systems vary dramatically among resorts.
How much you spend not only will determine the type of resort you’ll get, its location, and when you can use it, but it also will govern the value of your timeshare on the exchange market, which allows you to vacation elsewhere during any particular year, as many owners do. Usually, if you buy a low-value timeshare, say, during the off-season in Ocean City, Oceanside, or Oshkosh, don’t expect to exchange it for a prime week at a top-rated resort, such as one in Hawaii, during the peak aloha month of December. There are strategies owners use to increase their chances of success on the exchange market, but that takes some know-how, too. For example, you can plan your vacations years in advance or skip a year or two, which can leave you with extra unused points that will give you better choices. And depending on whether you’re exchanging through your resort or a specialized exchange company, you may be required to shell out membership and exchange fees on top of the timeshare-related charges you’re already paying.
As daunting as this sounds, it’s just part of what you’d need to know to ensure you end up with those dream vacations and not an expensive timeshare headache.
You might be sold a bill of goods.
All of this is further complicated by the shady and high-pressure tactics that are typical during timeshare sales presentations. For salespeople, the priority isn’t to make sure you understand all the ins and outs of timesharing; it’s to get you to make a purchase before you leave. “Once you walk out, the chances of a salesman closing that deal are probably close to zero,” said Rogers.
We heard many stories of salespeople using unethical and deceptive practices, including leading prospective buyers into thinking that the value of their timeshare will increase over the years—the opposite of what usually happens—or overestimating the worth of their timeshare week on the exchange market. Some salespeople have even tried to shame prospects into making a purchase, asserting that their failure to buy would be evidence that they didn’t love their spouses or that they were too poor to raise their children properly.
“The pressure is enormous. They pull out every stop you can imagine,” said Kevin McCabe, a retired New York City Fire Department battalion chief, who has attended several timeshare presentations. He said one saleswoman tried to convince him that if he purchased a winter week at a resort on Cape Cod, he easily could exchange it for a week in Hawaii. “She said Europeans love to visit Cape Cod in January,” he said.
Another common sales tactic is to offer special discounted deals that supposedly are good for one day only. And those sales presentations can go on for hours, testing the willpower of even the savviest consumer.
Timeshare salespeople may be quick to mention that the law gives you a three-day cooling off period to change your mind after signing a timeshare purchase contract. But that’s not a lot of time to figure out all the ramifications of the deal, give yourself a quick course in timeshare basics, and decide whether the timeshare you just purchased is the right choice. That’s especially true if you’ll be spending the next few days downing piña coladas as you enjoy the free or low-cost vacation the timeshare developer offered as an enticement to attend the sales presentation.
It’s a lifetime obligation.
When you buy a timeshare, you’re typically making a lifelong commitment to pay annual maintenance fees and other charges. While an increasing number of resorts are adopting exit programs that allow owners to return their timeshares, the details often aren’t readily available, and they can change at any time. Even if you’re allowed to walk away, you usually will lose the entire amount you initially paid—which can be a lot, considering that the typical timeshare these days sells for around $21,000. You might even have to pay an exit fee of perhaps $1,000 or more. Although you can list your timeshare on the resale market, you’re likely to get little if anything for it there either. Or you may have to offer incentives to induce someone to take it off your hands. And if you decide that you’ve had enough and abandon your timeshare, you could end up with wrecked credit, especially if you have an outstanding mortgage on the timeshare, and you could end up in a legal battle with the resort.
Some of the risks are unpredictable.
Having a lifetime commitment is bad enough, but not knowing exactly what you’re committing to is even worse. Those annual maintenance fees can rise at the whim of the company or homeowner’s association that manages the resort.
You also can face special assessments, one-time charges that can be hundreds or even thousands of dollars, and in some cases might last multiple years. You might be charged a special assessment if, for example, a hurricane severely damages your resort and it needs to raise money to pay for repairs. Also, that hurricane (or earthquake, fire, or other calamity) might make your timeshare unusable for years, during which you can still be on the hook for maintenance fees and special assessments.
Another concern is that your resort could fall into disrepair or might lack the level of maintenance you expect. McCabe said one Florida timeshare resort he visited had been so neglected that “you didn’t know if you were going to get mugged going to the concession stand.”
You can’t predict your future needs.
You never know what future events might affect your ability or desire to travel. We’ve seen owners eager to unload their timeshares because of a divorce or the death of a spouse. For others, their children simply have outgrown that annual summer vacation to Wally World or wherever. “Anyone thinking of purchasing a timeshare should stop and think about not where they are in life today, but where they will be 20 and 30 years from now,” said Michelle Corey, president and CEO of the Better Business Bureau of Eastern & Southwest Missouri & Southern Illinois.
There are lots of alternatives.
You can find plenty of websites and other resources that offer travel deals and vacation accommodations at reasonable prices—and don’t require you to lay out potentially tens of thousands of dollars upfront for a lifetime commitment to one company. At Checkbook.org, you’ll find much advice on how to find great travel deals—and avoid trouble.
Even if you’d like to spend a week at a specific timeshare resort, you may find it up for rent on Airbnb, Vrbo/HomeAway, FlipKey, or similar vacation rental sites. Maintaining complete control of your travel plans means you avoid the complications and obligations that go along with timeshare ownership. “Go where you want to go, and pay for it when you get there. For most people that’s the best way to go,” said Daniel Blinn, a Connecticut attorney who over the years has owned six timeshares.
If you’re still considering purchasing a timeshare…
- Educate yourself. There is a lot of very useful information online, including on the Timeshare Users Group website and RedWeek.com. Check the conversations on timeshare message boards and post questions. We found many owners eager to help.
- Rent first. If you’re looking at one or more resorts, first try renting a unit at that location. Being onsite for a week or so and talking to other owners can give you a good idea of what to expect if you proceed with a purchase.
- Buy on the resale market, where timeshares often go for 10 percent of their retail cost or less; this might save you tens of thousands of dollars. But because they still will come with all the fees and other obligations you’d get if you bought from a developer, do your homework. When weighing the costs, don’t forget to include any transfer-related fees: You might be able to persuade the seller to pay them. Finally, keep in mind that some resorts don’t provide full benefits to those who purchase on the resale market.
- Don’t be pressured into signing anything. If you attend a timeshare sales presentation, use caution. Never sign a contract on the spot, no matter how attractive a today-only offer seems. Take the contract home and review it carefully. Don’t rely on any spoken assurances a salesperson makes; get everything in writing, including any claim that you can sell back or otherwise return your timeshare if you no longer want it. If you have any questions or need advice on your upcoming purchase, posting on timeshare message boards can help, too.