Last week John Oliver roasted timeshare exit companies who dupe and scam owners, mostly seniors, who want to sell their timeshare. Unfortunately, this is not the first time sharks are taking advantage of seniors scaring them into forking over thousands of dollars and then leaving them high and dry.
Recently, the U.S. Department of Justice, on behalf of the Federal Trade Commission and the Wisconsin Attorney General, filed suit in November against Consumer Law Protection and related companies, along with their owners and operators, Christopher Carroll, George Reed, Louann Reed, Scott Jackson, and Eduardo Balderas.
In another massive timeshare exit scam, they scammed consumers—mostly older adults—out of more than $90 million.
“The defendants used scare tactics and high-pressure sales pitches to coerce seniors into forking over thousands of dollars for timeshare exit services they didn’t deliver,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection.
Yet Again, Seniors are Being Scammed
Yet another broken record tale of seniors being duped with deceptive and flat-out false claims about how to end their timeshare ownership. How did they do it?
- Made bogus affiliation claims and falsely used logos of legitimate timeshare companies and trade groups to lead consumers to think their services are endorsed or “authorized” by major timeshare companies.
- Deceived consumers about their options by saying they could not exit a timeshare on their own without paying the defendants an exorbitant amount of money. They also threatened consumers to buy their service on the day of the sales pitch, or they will never be able to exit their timeshare.
- They used fear-based tactics that convinced them their heirs would be saddled with ever-increasing maintenance fees after the consumers died. When in fact, states have procedures allowing heirs to disclaim any timeshare inheritance.
- Failing to give consumers promised refunds. The defendants’ sales documents include a “guarantee” that consumers will receive a full refund if they do not deliver on their promises. When consumers call to request refunds, the defendants cite non-existent litigation, the COVID pandemic, or other phony reasons why they haven’t secured the timeshare exit and then deny nearly every refund requested.
- They pressured consumers to sign contracts with non-negotiable and unenforceable terms. They pressured them to sign contracts that said consumers were not allowed to cancel. Including such a contract term violates the FTC’s Cooling-Off Rule, which guarantees the right to cancel a contract, like this one, within three business days of the sale.
Don’t Pay for Something You Can Do Yourself: 3 Ways You Can DIY a Timeshare Exit
Out of the 10 million timeshare owners in the U.S., approximately 850,000 owners are looking to get rid of their timeshares. But unfortunately, unscrupulous companies are taking advantage of people, especially seniors, over and over.
According to the Better Business Bureau Institute’s Scam Tracker, travel/vacation/timeshare scams are the riskiest situation for people 65 years of age and older.
“While there are timeshare exit companies that claim success in their marketing, there are many exit companies that are the subject of criminal and civil investigations that take money from consumers without providing any services and that have shut down, leaving consumers high and dry,” said Robert Clements, vice president of regulatory affairs at ARDA-ROC.
“That’s why we’re committed to continuing to raise awareness about this issue and work to ensure owners can get information and support about how they can safely pursue an exit from their timeshare while avoiding scams.”
So How Can Someone Get Out of a Timeshare without being scammed? This is something you can do yourself. Here are three tried and true ways that millions of real people have used to end their timeshare ownership.
1. Use The Cooling Off Period
If you just bought a timeshare and have second thoughts, you can cancel your contract and get all your money back if you’re within your rescission period. Depending on state law, you have 3-15 days to contact the resort and file a rescission letter to cancel your timeshare.
Timeshare Users Group (TUG), the oldest and largest owners group and advocacy organization, reports that people, on average, save $18,000 by writing a letter and sending it to the timeshare resort during this window.
2. Take Advantage of Deedback Programs
If you own your timeshare free and clear, many timeshare resorts and chains will allow you to deed it back to them. So why pay a company thousands of dollars when most owners take care of ending their ownership themselves with a phone call?
You can get started at the Timeshare Industry Association Responsible Exit website, which guides people through the deedback process.
3. List It on the Resale Market to Complete a Sale
There are trusted, reputable resale marketplaces to list paid-off timeshares for as low as $15. You can research the current market value of your timeshare ownership, list it for sale and find a buyer in one place.
The Better Business Bureau and millions of timeshare owners highly rate TUG and Redweek. TUG alone has successfully sold or rented $55 million worth of timeshares since they opened their doors in 1993.
In a Rough Spot? Rent Your Timeshare as a Temporary Solution
If you’re an owner looking to exit a timeshare because you can’t pay the bills but want to continue owning, short-term options are available to get you through a difficult period like job loss.
Consider renting your timeshare out to others to help cover your annual maintenance bills until your situation changes. Also, call your timeshare company, as they have hardship programs for owners.