Have you been mis-sold a timeshare?

Thousands of people have been left devastated because of mis-sold Timeshares and the promise of receiving a significant return on their timeshare investment that has never materialised. What was supposed to be a nest-egg for the future has left the buyer in serious financial difficulty, often lumbered with lengthy and costly finance agreements and high annual maintenance costs.

Unfortunately, even some of the biggest timeshare companies have been known to use underhand tactics, intimidation, and deception in the acquisition and maintaining of members.

We have come across countless cases of this nature, from people being manipulated into contracts that are dubious at best or downright illegal at worst. Here you’ll find some of the most common kinds of timeshare malpractice, and what you should do if you are affected by them.

Your timeshare was sold as an investment

Timeshares were often mis-sold by a salesperson who promised financial growth and a return on investment; unfortunately it was more likely your timeshare didn’t hold its value or yield any returns.

A timeshare is not an investment. Investments are designed to appreciate in value, generate income or do both. A timeshare is unlikely to do either, despite what the salesperson says.

The huge volume of used timeshares on the market, the appeal of buying new versus used, and the marketing muscle of the firms selling new timeshares all work against the idea that you will make a profit reselling your used timeshare. Thus, selling for a profit is an uphill battle considering you need to convince someone to pay more for a used unit and factor in all the fees you paid over the years.

To sell a timeshare as an investment is, therefore, potentially a form of mis-selling.

You were told the maintenance fees would not go up

The main issue that arises with timeshare property is the rising costs of maintenance fees year on year, which the client was not made aware of when signing the contract.

For many Timeshare owners, annual maintenance fees were barely considered token amounts in the early “honeymoon period” of ownership. However, year-on-year increases imposed by the resorts over time now mean that the maintenance fees have risen to become substantial sums.

Owners are also facing the prospect of ongoing yearly fee increases and realising that they (and their families) are often committed to long term contracts for generations to come.

No availability – Floating weeks

A floating week is a type of timeshare contract where the owner can choose from a range of weeks when he will enjoy his property each year. However, floating week timeshare contracts often breach the law.

As weeks are booked by various timeshare owners at the same time, they may not get to obtain their desired weeks. In many occasions, floating weeks lead to a mess as timeshare owners are often deprived of enjoying the property even though they would still be required to pay the maintenance fees on it.

People who have bought a timeshare points style contract, where they accrue points that can be exchanged for timeshare holidays at, ostensibly, a wide range of quality resorts across the world, have also often found that the availability of said holidays is almost nil. Even when trying to secure a booking a year or even two in advance yields no results, or they are forced to book a lower quality trip than they had expected or paid for.

Timeshare contracts in perpetuity

Timeshare contracts in perpetuity are timeshare contracts where there is no end date or the term exceeds the legal limit, which is fifty years.

To many owners, perpetuity clauses have become a burden of immense proportions, owning a timeshare they no longer want, watching the maintenance bills go up every year and feeling trapped into something that they can’t get out of. What started as a dream is now a liability.

These contracts are against the Spanish 42/1998 Law. The Supreme Court ruled that all contracts signed after 5th January 1999 must have a duration period of less than 50 years, thus outlawing the practice of “perpetuity contracts” which had been prevalent since the 1980s.

You were told that your resort was ‘exclusive’

You may also have been told that your resort was ‘exclusive’ to members only, but when you visit you find that there are lots of non-members staying there.

This can often be the reason that points-based members are unable to book at their chosen resort, as rooms are reserved for non-members.

New Timeshare Contracts

If you hold a timeshare membership, then you should be very suspicious if you are presented with a new, updated contract to sign by your timeshare company.

In light of new legislation that renders any contract that exceeds a legal maximum of fifty years in duration, as well as other unfair contract terms being ruled illegal, many timeshare companies and resorts are issuing new contracts for their existing members to sign. These new contracts are designed to override the previous, illegal contract. Once the new contract is signed, any entitlement to nullification or compensation on the grounds of the illegality of the contract is voided and you no longer have a case against them – So watch out.

In an industry with little or no regulation, high pressure sales tactics were rife and contract smallprint was often glossed over and explained away by sharp salespeople.

If a timeshare was mis-represented, breached contract or sold as an investment and you’ve received no return you should seek legal advice regarding a claim, even if the company is no longer trading.