Sometimes you may find yourself on vacation in a place you really love. Something about the atmosphere or the idea really appeals to you and you find yourself wondering about getting a timeshare. Or maybe you got a discount at a hotel as long as you sit through their hour long timeshare pitch. Either way, getting a timeshare may seem like something you might be willing to do. We’ve put together a list of 6 things you have to know before you consider purchasing a timeshare.
- Don’t pay full price. Timeshares are notorious for the hard sale. They are continuously marketed as an impulse buy. The reason timeshares use this type of marketing is not only because of the large cost of marketing, but also because you as the buyer have so many options. There is so much competition (like RedWeek and Timeshare Users Group) for your money, timeshares have to work hard to make sure you pick them. This means that there is room for negotiation, you don’t have to take the first price you’re offered and you shouldn’t!
- Make sure you know what you’re buying. When you’re thinking about where to buy a timeshare, it’s important to be aware of the differences in property law with the US and other countries particularly Mexico. If you buy a timeshare in Mexico, you won’t be protected by US property laws and it won’t necessarily look the same. In the US, a lot of timeshares will give you a property deed called a timeshare estate which means you have the freedom to rent the share, sell it or pass it on.
- Know about other fees. Some timeshare owners are shocked when they are looking at a timeshare contract and see there can be many fees instead of just the annual payment. One of the typical fees you see in timeshare contracts are annual maintenance fees. Properties require this fee to make improvements and keep the property well running. Outside of the annual maintenance fees though there can be other fees written into the contract. If the property experiences a natural disaster, they could incur a fee on all timeshare owners to cover the damage! Be sure to read your contract thoroughly before signing to make sure you’re aware of all fees.
- Know how to trade and swap your timeshare. If you want to exchange your timeshare, it can be easier to do if your place is part of a larger resort system. If it’s not, it may be harder to do although there are websites that can help you to exchange like, RCI. Again, read your contract thoroughly to see if it talks about the process of exchanging your timeshare within the resort network or ask your resort contract to make sure that you know all the possibilities.
- Beware of scams. While buyers should beware of any timeshare offers that seem fishy, it is often timeshare owners that experience many scams. If you get a call from a “buyer” that offers you a price over what you’d expect and you haven’t put your timeshare up for sale, don’t give out any important information. These scams will take thousands of dollars in marketing fees or contract fees but never complete the final sale. If you are trying to sell your timeshare, read the FTC’s guidelines on selling the timeshare.
- Know that you are not investing in real estate. If you are looking to make money on real estate, a timeshare is not for you. Taking on a timeshare will help you create great vacation memories with your family or partner and will help you to have a consistent vacation spot to use, but it won’t make you money. To get the most out of a timeshare, you actually need to use it. Many people looking to sell their timeshares, never had the chance to use it. Make sure you go into the timeshare having an idea of when you will be able to use it!
For more information check out the video by, Kim Curtis, the CEO of Wealth Legacy Institute and the best selling author of Money Secrets: Keys to Smart Investing.