People come to us who have had a timeshare for five years, ten years, fifteen years, whatever it may be, and they want to exit. They’ve usually been to their resort and been told that they are contractually obliged to carry on with their contract. Some contracts are in perpetuity, and the age bracket of long-term timeshare owners now is such that they’re wanting to plan their future and don’t want to pass on debts and liabilities, which has been quite well publicised.
A lot of resorts do not allow people to exit what are now quite onerous contracts and liabilities. So that’s a fairness issue.
What people have to understand about timeshare companies is that timeshare has become progressively harder and harder to sell. So, when you’re a company that’s got a product that you earn a residual income year after year after year from your existing client base (I’m talking about maintenance fees now), and it’s more difficult to replace people with new sales that are dropping off with death, or not being able to travel anymore, or just wanting to get out of their timeshare, these resorts are all seeing a drop in their maintenance fees.
Now, ten years ago, the timeshare company I worked for had a department that actively tried to acquire stock timeshare back so they could resell it. We used to buy timeshares ten years ago from people who hadn’t paid the maintenance fees for a year or two, that kind of thing. The company would phone people up and say, look, we’ve noticed that you’re in arrears. Obviously, it’s not a good thing that you owe us this money – however, we will wipe it off if you relinquish the ownership of your timeshare to us.
The company was usually then met with the response of, well, yes, please. Even though those people could have spent £6-, £8-, £12,000 many years ago for that timeshare, they were obviously in a position either age-wise or financially in their life where they couldn’t use it anymore, couldn’t afford to keep it anymore, and so were quite happy to relinquish it.
Ten years ago, that was quite common amongst most timeshare resorts. They needed the stock back in. When you have a timeshare resort that’s got, let’s say 100 apartments, you only have a maximum of 100 apartments x 52 weeks, so it only gives you 5,200 sales. So, after you’ve sold everything out, for you to carry on with your sales operation, you need to make sure that you either go out and build more timeshare resorts, which costs a lot more money than if the timeshare owner would just give it back for free. Then you’ve got the timeshare coming back for free that you can then sell off again at full price.
What happened, however, is that gradually stopped, because, timeshare companies started having far too many spare weeks, spare apartments, spare units. They weren’t selling them off again quick enough. What that means is that the resort holds a huge amount of its own stock and there are no maintenance fees coming in from that stock. So, you need to get it sold so that then it is owned by people that are paying maintenance, which goes towards the upkeep of the resort.
This has led to the situation we have now, where resorts are saying to people, no you can’t give it back, you can’t get out of it. Why? Because, in desperation, they’re trying to hold on to their client base as they can’t sell the spare stock quick enough. Thus, timeshare resorts know it’s not good PR to not let people out of their timeshares but they can’t afford to just let people go.
Clearly, it’s not all plain sailing for the timeshare companies either. Nonetheless, this doesn’t excuse them from their duty of care to their members. That’s why we’re here, to try and redress that fairness. We’re not anti-timeshare at all, in fact. We just want to make sure that people get justice. There are still many people who are perfectly happy with their timeshares to this day, and were the system to function as it should, we’re certain many more would be happy too.