Since 2004, we’ve been helping families navigate solutions to end their timeshare contract. Increasingly as timeshare owners age, family members are confronted with a new problem; they may inadvertently inherit a timeshare contract they don’t want.
If both parents signed the contract for the purchase of the timeshare, the financial obligation passes onto the surviving spouse. That means the membership fees and maintenance fees will be billed directly to the household, if both names are on the contract. If only one parent signed the timeshare contract, the legalities and recourse of the timeshare company to claim on the deeded, or non-deeded agreement, are still enforced. A contract does not expire, when the purchaser becomes deceased. Instead, the timeshare can move against the estate of the deceased legally, requiring an adjusted lump-sum payment, or the continuation of fees as outlined by the contract.
Can the Timeshare Debt Owed Be Deducted from the Estate of Your Parents?
The short answer is ‘yes’, but it depends on the terms and conditions of the contract, and the policy of the timeshare organization. Since 2004, we’ve met and counseled many families who were shocked to discover that the timeshare contract terms were not voided, by the death of the contract holder and they have to inherit a timeshare contract they never owned.
The loss of a family member is both emotionally, and financially difficult for the surviving spouse, who may or may not be able to continue living independently, on a single retirement income. A timeshare that was affordable with a combined income, can quickly become a debt scenario, and threat to personal credit. It can create additional financial problems and stress, in an already difficult time for the family.
Timeshare Cancellation Options If You Inherit a Timeshare Contract
Many times, over the past decade of service, our team has spoken to adult children who unknowingly inherited the financial obligation of a timeshare. While American law protects adults from inheriting the debt owed by parents, the unfortunate surprise is the financial adjustment and legal process that some timeshares engage in, to recoup the value of the contract, from the existing estate.
We know that, Americans are living longer (and that’s a good thing!). What is difficult is that many citizens find themselves in a situation where finances are precarious through their senior years. Increased cost of living, reduced income ability and health care needs can take a big bite out of the nest egg that many families put away for retirement. The intention to leave behind some inheritance or monetary gift to surviving family members, is always there, but not always possible.
Now imagine a situation where there is a gifted amount of inheritance, that will be paid to family members. Before dispersement of the funds, a resolution of all outstanding debts occurs. And a surprising bill can come from the timeshare company, who can prorate the years left on a timeshare contract, and legally demand a payment to resolve that amount.
That leaves surviving family members with a small inheritance, that is further reduced by financial obligations to a timeshare contract. And if think that most timeshare companies would be compassionate in these situations, think again. They have no problem following through on collection, and even pursuing the matter legally, costing the family more money in legal costs.
Start A Conversation with Elderly Parents About Canceling a Timeshare Before You Inherit a Timeshare Contract
If you’re parents have been periodically using their timeshare, without issue, it can be difficult to convince them that financially, it may be more advantageous to cancel their contract. All timeshare agreements are not created equal, and if they find that the cost of membership and maintenance fees are reasonable for the time that they enjoy, they may be satisfied with retaining their contract.
However, for American seniors, circumstances can quickly change. Health issues can cause unexpected financial problems, which can make affordability an issue in the future. Part of responsible estate planning, is the ability to visualize how expensive a timeshare agreement can be, if one partner passes away. And to recognize the fact that few family members, may wish to inherit the contract.
For many elderly timeshare owners, affordability is a problem that continues to compound on an annual basis, as timeshare fees go up. A recent client we helped, was acting on behalf of his widowed mother, who was not responsible for administering the financial expenses of the household. She was shocked and simply unable to afford the cost of timeshare ownership without her spouse. Expenses were so exorbitant that her ability to remain independently living in her own home was precarious, unless she was able to reduce expenses, which included resolving the timeshare contract.
Sometimes seniors that are not actively using their timeshare, or those that have not used it in years, simply hold on to it, assuming it is more an asset than a significant financial liability. They may believe that children and grand children may wish to inherit the family timeshare, or that it may be of use to those they know and love. But if a timeshare offers no ‘break even’ value for the annual expenditure, and if trying to sell the timeshare privately, or transferring ownership to another relative is not possible, the time to start talking about cancellation of the contract is now. Before it becomes a financial detriment to a surviving parent, on a fixed and limited income.
Avoid Fraudulent Timeshare Resale Service Providers
It’s hard for consumers to consider that their timeshare has virtually no market value, particularly after paying the upfront investment or purchase fee, and cumulative annual membership and maintenance fees. Our best advice is always to look at locations like E-Bay or Craigslist, and timeshare resale websites, to see exactly how many units are for sale, and how long they have been listed. Many consumers struggle for years, without successfully transferring their contract to another owner.
There are exceptions, when the timeshare is run by a reputable resort management team, and where demand exceeds the available units for purchase. In those rare cases, some timeshare owners can list and sell their unit, to recoup some of the purchase price and investment. However, statistically in the United States, less than 2% of timeshares are successfully sold. Many people, fall victim to guaranteed sales promises by timeshare resale teams, who take their money, and provide no results.
With thousands of timeshares being sold privately by owners, starting from only $1.00 U.S.D., the best course of action is to learn your options and understand how timeshare cancellation really works, rather than wait to inherit a problem. With our attorney led team of counselors, we provide a transparent review of your contract, and an action plan that can help you resolve your timeshare, in 12-months or sooner, or we provide a refund of your service fee.
We don’t stop working, until we get our clients a favorable result, and permanent cancellation of their timeshare, or you get your money back. It’s that simple. Contact us today for a free review and consultation.