For Your Information: 08/27/2010
FTC Warns Consumers to Exercise Caution When Selling a Timeshare Through a Reseller
The Federal Trade Commission, the nation’s consumer protection agency, offered these tips for people who seek to sell their timeshare through real estate brokers and agents that specialize in reselling timeshares:
- Even if the salesperson claims the local market is “hot,” or his office is overwhelmed with buyer requests, don’t agree to anything on the phone or online before checking out the reseller. Contact the Better Business Bureau (www.bbb.org), state Attorney General (www.naag.org), and local consumer protection agencies (www.consumeraction.gov) in the state where the reseller is located. Ask if any complaints are on file.
- Ask for all information in writing.
- Ask if the reseller’s agents are licensed to sell real estate where the timeshare is located. If so, verify it with the state real estate commission. Deal only with licensed real estate brokers and agents, and ask for references from satisfied clients.
- Ask how the reseller will advertise and promote the timeshare unit. Will progress reports be issued? How often?
- Ask about fees and timing. It’s better if the reseller takes its fee after the timeshare is sold. If a fee must be paid in advance, ask about refunds. Get refund policies and promises in writing.
- Don’t count on recouping the purchase price of a timeshare, especially if you’ve owned it for less than five years and the location is not well known.
- To get an idea of the value of a timeshare, consider using a timeshare appraisal service. Check with the state where the service is located to make sure the appraiser’s license is current.
- Before signing the contract, make sure it specifies the services the reseller will perform, the costs the seller is responsible for and when they must be paid, whether the seller can rent or sell the timeshare at the same time the reseller is trying to sell it, the length or term of the contract to sell the timeshare, and who is responsible for documenting and closing the sale.
- Don't sign the contract if the deal isn't what you expected or wanted. Negotiate changes or find another reseller.
- Check with the resort to determine restriction, limits, or fees that could affect resale or ownership transfer.
- Have available the name, address, and phone number of the resort, the deed and the contract or membership agreement, the financing agreement if money is still
owed, information to identify your interest or membership, the exchange
company affiliation, the amount and due date of the maintenance fee, and the
amount of any real estate taxes that are billed separately.
- For more information contact:
American Resort Development Association
1201 15th Street N.W., Suite 400
Washington, D.C. 20005
(202) 371-6700; Fax: (202) 289-8544
For more information, see Selling a Timeshare Through a Reseller: Contract Caveats.
The FTC works to prevent fraudulent, deceptive and unfair business practices in the marketplace and to provide information to help consumers spot, stop and avoid them. To file a complaint or get free information on consumer issues, visit ftc.gov or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. Watch a new video, How to File a Complaint, at ftc.gov/video to learn more. The FTC enters consumer complaints into the Consumer Sentinel Network, a secure online database and investigative tool used by more than 1,800 civil and criminal law enforcement agencies in the U.S. and abroad.
- MEDIA CONTACT:
- Office of Public Affairs
(FYI timeshare resellers)