Abhishek Agarwal asked: Investing in Timeshares can be beneficial and a source of money for some people. It is also a very profitable investment for most people. But there is more to the story. Though some people reap the immense benefits that timeshares provide there are many others who have had their dreams crushed and lives turned into nightmares because they bought timeshares. Hence, timeshares should always be bought with a high level of caution and alertness. Before you sign the contract papers, make sure that you are aware of the risks and benefits involved. If appropriate safety measures are not taken, this money making venture could incur a huge loss. Do not forget to read the fine print before signing the contract.
Timeshares are broadly divided into deeded plans and non-deeded contracts. In a deeded contract, a person buys the ownership of a real estate property or land. The property owner gets full rights to the property, including title and the property may be inherited by his heirs. But in a non-deeded plan, the person buy the license or lease or club membership that allows you to utilize the property for a particular number of years for a specified time each year. However, in both cases, the price of the unit depends on the season and time period for which the individual wishes to buy the property. The owner’s rights will expire when the lease becomes outdated, in the case of right-to-use timeshare.
People tend to take sufficient care when they are making an important investment. This is applicable to timeshares also. You must ensure that you read each and every document carefully and thoroughly understand what you are gaining through the investment prior to signing of agreements and payment of fees. Taking professional advice is recommended when making large timeshare investments. You can take professional advice from your attorney or from your peers. Mentioned below is a list of things that people must consider carefully before buying a timeshare.
1. When you are planning to invest in a timeshare that comes from a resale company, check if they have a license. A simple way to do this is by noting the broker’s license number. You can use this number at the State Department that handles such transactions and find out the past of the broker. If you buy timeshares from non-licensed firms, your money is at a greater risk level, you would have too much at stake and the chances of a scam are higher.
2. Timeshares are used for personal competitive uses, and you must be fully aware that its resale may or may not give good returns.
3. If you are investing in a non-deed plan timeshare, you must be alert because you are likely to lose your privileges if the sponsor claims bankruptcy.
4. You must insist on a written assurance from the seller when you are investing in a property whose facilities are not completely installed. The undertaking must specify the time limit required for completion.
5. If the seller makes any claims or assumptions about the profits of a timeshare investment, question his statement thoroughly, because a timeshare’s future value is based on various factors.
6. Do not buy timeshares impulsively. Thoroughly study every paper that you have to sign. Spend enough time on research, analysis, and decision making before buying a timeshare.
7. Do not take oral promises or ones made on the phone, or even face-to-face. Ask the seller to give you everything in writing.
8. Check whether you have a guaranteed exchange program. In certain cases, it is not. Investing in timeshares which does not give you an exchange facility is not of much use, because it lacks schedule flexibility.
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