Does a timeshare contract include perpetuity? What is perpetuity?
Unfortunately, many timeshare contracts do include perpetuity, unbeknownst to the owner. This is a clause that renders the ownership of a timeshare indefinite – the owner in question will be required to pay all relevant fees until selling the timeshare, or until the resort is closed. When the said owner dies, his or her next of kin inherits them.
Why is my timeshare so hard to use?
Many timeshare users have complained about the inconvenience of having to book weeks so far in advance – years, even, for certain dates – and the lack of flexibility in exchange programs. The truth is that the most popular resorts fill up quickly at the most popular times, often leaving the majority of timeshare owners out of luck. It has also been speculated that some companies turn around and rent out peak weeks to the public through separate companies; the exchange program at Resort Condominiums International (RCI) is so difficult that some users are filing class action lawsuits.
What are maintenance fees? Why have they not stayed at a fixed rate?
Maintenance fees are charged by resorts, often in (although not exclusive to) “right-to-use” contracts, to cover operation costs: cleaning, repair, upkeep, etc. They are almost never written into contracts at a fixed rate, and so resorts can raise them whenever they deem it necessary with the same obligation to pay. Often times owners are promised that rates will climb much slower than they actually do.
Why can I not resell my timeshare? Or why is my timeshare not worth what I paid for it?
A number of things can cause a timeshare’s value to depreciate – it’s estimated that resort companies inflate the price by 30% alone to cover their steep advertisement costs. There’s also the issue of location, weather, and popularity – all factors that can vary wildly over time. And, of course, there are some companies that sell timeshares for far more than they’re worth. The truth is that the resale market is intensely competitive, with many timeshares being bought at a mere fraction of their original price. A number of online travel companies rent timeshare weeks to non-members, too, keeping resort properties in low demand.
Can I donate my timeshare to charity and use it as a tax deduction?
The short answer is yes – however, this is almost impossible to do. The charity must accept your donation, which they rarely do with hard-to-sell timeshares. This is due to the fact that, like the owner, the charity’s goal will in most cases also be to resell the timeshare. Some donations also accept timeshare on a strictly “right-to-use” basis; the deed is retained by the original owner, along with any maintenance or membership fees. And often times donating the property means paying legal experts who arrange such transactions for the charity. On top of all this, you can never deduct the full amount you paid for the timeshare if it has depreciated in value. And it’s estimated that all timeshares lose at least 30% of their value the instant you purchase them from a resort company.