January is a great month to start planning what you want to accomplish in the new year. Your financial resolutions goals are tied closely to expenditures that you may, or may not wish to continue paying for, monthly. For timeshare owners, who may be facing increased maintenance fees and costs of ownership, it is also an evaluation period where you may want to ask some tough questions. Are you using your timeshare frequently enough, to warrant the annual or monthly expenses of membership and other fees? Are there other more affordable vacation options available now, that make owning a timeshare redundant for your family?
As part of your new year resolutions, take some time to consider what your timeshare is really costing you, and whether the value proposition for owning a timeshare, still makes sense for your family.
How to Calculate the Real Cost of Timeshare Ownership
According to a statement by Howard Nusbaum, CEO and President of ARDA, the average American pays $19,000 for the purchase of a timeshare, in an upfront cost, and approximately $660 per year in maintenance fees. That is based on a one-week timeshare.
Those costs are over simplified. How many timeshare owners do you know, that pay $1,000 or more per year, in maintenance fees for some of the highest rated resorts in the Caribbean or North America? For many owners, the only time that timeshare ownership feels affordable, or within their budget, is during the first year; before costs increase and continue to rise incrementally.
There are many other timeshare related expenses that are not talked about, but which impact the affordability for owners. At timeshare sales presentations (before you buy), resort representatives will present the opportunity to rent your timeshare, to offset some of the costs of ownership. Not only does that mean giving up vacation time that you have paid for, but resorts are notorious for tacking on fees for listing your timeshare on a rental board. They can also make it difficult through terms of your ownership contract, to independently rent your timeshare, without paying additional fees, and damage waivers that can add up quickly.
The initial loan (if one was required) to purchase your timeshare, adds additional annual costs, for every year you remain in the financing agreement. Fractional timeshares can also come with additional costs for property taxes, which, unless you are regularly renting multiple properties for income, are not tax deductible for you.
The fees that timeshares charge, that catch owners off guard, include mandatory property assessments. Assessment fees sneak up on timeshare owners, and are impossible to plan for, and reflect financial needs of the resort that are not included in annual maintenance costs.
Here are a few reasons why your timeshare may request an assessment fee, or payment, without warning:
Your resort sustained heavy damage in a hurricane or tropical storm.
The resort is under poor management, and has fallen into disrepair and requires significant upgrading to maintain services for members.
The timeshare has decided that the resort is no longer competitive with amenities offered at other resorts, and plans to overhaul the facility, and rooms or suites.
One extreme case of assessment fees that created financial hardships for timeshare owners, was the DRI Hawaiian Collection. The resort claimed almost $66 million dollars in damage due to water intrusion and flooding. Almost 8,000 timeshare owners were notified and assessed for $41.5 million dollars, over five years, which resulted in an additional charge that averaged over $5,800 annually, for five years.
This unfortunate (but increasingly common) case resulted in many timeshare owners who were forced to surrender their deeds, and they sustained personal credit damage for doing so.
Spend Time Analyzing Your Other Vacation Options and Opportunities
There was a time when only the most coveted vacation properties, were accessible to timeshare owners. You could not rent time from other timeshare owners either; it was exclusive to members. Today, more timeshares are opening their doors to public and non-member bookings, to protect their revenues. And while sharing what is supposed to be a private and exclusive club with the public is a deterrent alone, it also means that timeshare owners have other more affordable options.
Start by making a list of places you would like to vacation in. What are the total costs involved in a one-week vacation? Websites like last-minute travel, and discounted hotel bookings are readily available online, allowing you to find a vacation that fits your budget.
And the best part? When your vacation is done, you won’t be dreading unforeseen financial expenses by mail or email, for assessment and maintenance fees. It is more economical now, than ever before, to create your own vacation, without owning a timeshare.
Are You Still Happy with Your Timeshare Experience?
Over time, the novelty of timeshare ownership can wear off. Consumers either get tired of visiting the same resort, where their vacation time is guaranteed, or they get frustrated at the lack of available inventory to swap and exchange their weeks, to explore another resort. The red tape is exhausting for timeshare owners, and cashing in on your weeks continues to get harder, as some companies within timeshare industry looks for new ways to charge more, and deliver less convenience and services.
You may be happy with the current cost of your timeshare, but are you still happy with the resort? Poor financial management can be blamed for the decline of many high-quality timeshares around the world. Are your accommodations still luxurious and clean? Is your timeshare still safe to visit, or has the surrounding area changed in a negative way, that makes you feel uneasy when you visit? These are all parameters that timeshare owners should evaluate, when they are deciding whether owning a timeshare still makes sense.
Weighing the Positives and Negatives of Timeshare Ownership
Some of our clients have shared that they felt a sense of frustration, regarding their timeshare obligation. In some cases, timeshare owners will wait years without using the timeshare that they continue to pay for. But when they successfully cancel their timeshare, with help from Aconsumercredit™, they express a sense of financial relief.
Your timeshare contract is legally binding, and some timeshare organizations do a good job of making their customers feel like there are no options. Owning a timeshare should never feel like a ‘life sentence’ or financial burden, that creates hardship for your family.
If you are ready to do something about it, and cancel your timeshare for good, we can help. Since 2004, Aconsumercredit™ has assisted thousands of American families, by providing a legal pathway to permanent timeshare cancellation. Our expert team will help you review the terms of your timeshare contract, and outline the administrative steps required to end your legal obligation, and get back to vacationing without skyrocketing timeshare costs.