How Do Timeshares Work? Plus How to Get Out of One
One of the best parts about being an adult is taking vacations. You get to choose when and where you want to go, and what activities you’ll do when you get there.
Vacation planning can be tough, so to remove the guesswork, millions of families across the country have chosen to invest in a timeshare.
If you’re considering doing the same, it’s important to have the answers to a few questions first. How do timeshares work? What exactly is it? How difficult is it to get out of once you’re in?
You’re in luck! We have the answers to all your questions below. To learn everything you need to know, just keep reading.
What Is a Timeshare?
Before we dive into specifics, let’s start with an overview of what a timeshare is. A timeshare is a vacation property that you have fractional ownership of. Other people invest as well, relieving you of a portion of the cost.
This ownership is typically split into weekly increments. So you “own” the property for a week or two, then another family takes over ownership. Investing in a timeshare guarantees you time at the property.
How Do Timeshares Work?
There are several different types of timeshares, all with different contracts and types of ownership. The type of timeshare you invest in will determine who owns the property and how your specific agreement works.
First, there are shared deeded contracts, where you own the property a week out of the year at the same time, in the same resort. These are known as fixed week timeshares and are the most common.
Then you have a floating week option, which allows you to change your week every year within a certain window of time. For example, you might be able to choose any week through the months of January and May.
Finally, there are points system timeshares. With this option, you’ll have a certain number of points to spend every year, which you can use to access resorts within your system.
Keep in mind, however, that different resorts are worth different amounts of points. If you want to visit a resort that costs more than the points you have, you’ll have to pay extra.
How Do You Cancel a Timeshare?
Though timeshares are a great option for many families, they do come with one common complaint: timeshare cancellation is borderline impossible. This is why, if you’re considering purchasing a timeshare, you shouldn’t take the decision lightly.
You’ll need to contact your resort or developer, who will then guide you through how to get out of a timeshare. Avoid purchasing a timeshare that isn’t recognized by the ARDA (American Resort Development Association). These are notorious for making it as difficult as possible to get out of your agreement, some even asking for tens of thousands of dollars in exchange for cancellation.
Common options are putting your timeshare on the resale market or simply stop paying your fees (assuming your initial investment is paid off) aside from writing a timeshare cancellation letter. If you’re concerned about the process required to sell timeshare, you can find more information here.
Is a Timeshare Right for You?
Now that you have an answer to the question “how do timeshares work?” you have a better idea of whether a timeshare is right for you. As we mentioned before, they’re a viable option for certain families.
However, you might find that putting the money you would have spent on a timeshare in a sinking fund for vacations or starting a vacation savings account is the better choice for you and your family.
Interested in learning more about vacation planning like a pro? Take a look at our blog!