You thought you were getting an amazing deal when you signed up for a quick two-hour meeting in exchange for a free trip! Instead, you walked away the not-so-proud owner of a signed contract for a long-term timeshare property.
This happens more often than you might think, prompting many to look into the timeshare cancellation – news and updates for information appropriate about the policies in the state where the sale took place. When they can’t find an easy way out, they assume that if they simply stop paying their maintenance fees, they’ll be kicked out of their contract.
Does this work, and if so, is it a legitimate way out of your timeshare? We’ll explain the pros and cons of defaulting on your maintenance fees here.
Understanding Maintenance Fees
Maintenance fees are defined in your contract. In general, they are used to cover the upkeep of the resort, including remodeling and refurbishing. Read your contract carefully, as it likely explains that the fees you must pay extend through the period of the timeshare mortgage.
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As with most fees, you can expect these to go up each year. Unfortunately, there is no way to control how high the increase is, giving developers and resorts the control to raise their rates beyond what would be normally acceptable. So, what was reasonable and feasible when you signed the contract might not be as affordable a few years later.
Pay or Don’t Pay Those Maintenance Fees?
At some point, maintenance fees may get out of control — and out of your budget. There are a few things you should know before you decide to skip out on paying those annual expenses.
First, you should be ready to forfeit your right to access the property if you don’t pay your fees. Until your payments are up-to-date, you won’t be able to book your vacation. You could face other consequences, like losing any banked weeks or the right to give your time to a guest.
Of course, missing your maintenance fees, on accident or purpose, will result in late payments added to what you owe. The developer or resort can add late fees to the increased interest rate, and they will continue to accrue while you aren’t paying.
By the time you are faced with the legal results of your inaction and have to pay the debt, the fees and interest could have accrued to an astronomical amount. Some people must resort to bankruptcy to get out of their timeshare debt.
Your Legal Rights
Legally, you are permitted to stop paying your maintenance fees as a way to terminate your contract. However, don’t expect those developers or resorts to let you go that easily. Your maintenance fees are what keep them in operation.
If you are ready to get out of your timeshare contract, understand that there is no simple solution unless you are lucky enough to live in a state with buyer-friendly policies and you just signed the contract. Otherwise, keep your maintenance fees up-to-date and talk to an expert who can help you find the best way out of your contract quickly.