Seller Beware: Timeshare Resale Scams Targeting Utahns Who Own Vacation Properties
So, you purchased a timeshare with the hope that making such a purchase would force you to take more vacation time. Or because you believed that it would be a great investment in your future retirement. However, time has passed, the economy is still struggling, and you now realize that you never have used your timeshare (at least not as often as you previously anticipated) — and you likely never will. Additionally, you are paying hundreds of dollars in annual maintenance fees that you simply cannot afford. The rush to get out from under your “investment” begins, and you turn to the Internet to resell your timeshare. You want to believe that your investment was indeed of significant value, and that you were being a responsible consumer when you purchased the timeshare. And that makes you a target for scam artists.
This week, I am departing from my usual immigration spotlight in order to warn my fellow Utahns about timeshare resale scams. Fraudsters have tapped into the desperation of those looking to re-sell their timeshares, often draining these victims of tens of thousands of dollars before the victims realize they have been defrauded. Often times, timeshare resale scammers approach timeshare owners who have already listed their timeshare properties for sale on resale websites, claiming that the market for their property’s location is “hot”. They also sometimes claim that they already have a buyer, corporation or foreign investor who is interested in purchasing your property. Owners of vacation properties located in other countries are even more vulnerable, as timeshare resale fraudsters prey on the average consumer’s lack of knowledge regarding international financial and real estate transactions. These scams have financially drained already strapped consumers nationwide of millions of dollars.
Timeshare Resale Red Flags
There are legitimate timeshare resale companies out there. However, many are only licensed to advertise, rather than sell your timeshare. Therefore, be wary of those companies who claim to have a buyer lined up to purchase your timeshare. Only a licensed real estate broker licensed in the state in which your timeshare is located can facilitate a timeshare resale (obviously if you sell the timeshare yourself, you don’t need a real estate license). Check with the real estate licensing agency in the state where your timeshare is located to verify the company’s right to conduct business in that state.
Additionally, steer clear of any company that wants to charge you fees prior to the conclusion of the transaction. Many fraudsters ask for various fees up front, including taxes, closing costs, etc., and ask that those fees be paid by either cash, check, money order or wire transfer, or ask for your bank account information over the phone or online.
If the sale price sounds too good to be true, it probably is. A common timeshare resale scam claim is that timeshare values have risen, particularly for timeshare properties located abroad. Generally speaking, timeshare values have plummeted from their pre-market crash levels. Don’t believe the hype – do your due diligence in ascertaining a fair price for your timeshare resale.
Also, beware if the potential timeshare resale company is unwilling to meet you in person, or will not provide a valid physical address for the company. Don’t just take the company’s “letterhead” at face value — timeshare fraudsters have become more creative in their tactics, often creating fictitious addresses. Spending a few minutes on Google Earth could help save you thousands of dollars and give you piece of mind. Performing a state business entity search for the purported resale company can also help keep you safe.
In many cases, the agreement said timeshare scammers provide to you will look legitimate to the untrained eye. The scammer may also tell you that the language in the contract is not important, or “standard” and try to convince you that there is no need for you to carefully review the agreement. Nonsense! Have a licensed attorney review any agreements the resale company asks you to sign. Most attorneys have enough experience with contracts to know whether a contract/sale agreement is valid or not. Paying an attorney for an hour of his or her time to review your contract before you sign will likely save you the hassle and heartbreak of attempting to get your money back from timeshare resale fraudsters after it is too late.
More articles regarding timeshare resale scams:
Schmidt Law Firm Law Firm
136 East South Temple Street #1500
Salt Lake City, UT 84111