With the economy picking up and the real estate market booming again, a lot of scams and fraudsters are out here hustling people with dreams of home ownership and vacation get-aways. And the number one culprit is usually timeshares.
With the invention of the Internet and travel sites like Kayak.com and Hotel.com, a lot of what made timeshares so amazing in the 80s and 90s no longer exist. You can essentially travel the world with your family for a much cheaper price than it is to buy a timeshare.
Timeshare companies realizing this trend have changed the sales pitch from “Wouldn’t you like to travel around the world?” to “Hey, wouldn’t you like to own a vacation home, like all the other rich people in the world?” This sounds great upon first hearing it, but they don’t explain all the drawbacks and fees associated with owning your 2 weeks in a luxury hotel anywhere in the world.
Timeshares themselves are not fraudulent or illegal. However, I wanted to talk about the people in the industry and the tactics they use to separate good working-class people from their hard earned money.
The bait and switch is the most common tactic you will deal with in the world of timeshare mania. While visiting a fair or carnival you will pass a booth offering free flights to Hawaii, Dodger tickets and a gift card for a meal at your favorite restaurant. All you have to do is sit through a 1 hour presentation with no obligation to buy.
What they don’t tell you is that the 1 hour almost always last 2 hours, and that when you’re finished, you will be taken to a table and essentially beaten into submission, by salesperson after salesperson, coming over and telling you why you need to buy today, or you will miss out on the deal of a lifetime.
The problem with all of this is once you have bought that timeshare you only have a 72-hour right of rescission to cancel the contract and get your money back. Unlike buying a car, where you do the research before going in and are prepared to either buy or walk, most people are blindsided by the timeshare hard sale. They went in looking for free goodies and ended up with a $23,000 weekend getaway to Las Vegas. That can end up ruining your credit if you don’t pay.
Just remember nothing in America is free so the next time you decide to become a vacation rental owner, ask yourself if you would really spend that much money on a trip to Hawaii or Las Vegas.
As always at WLM Financial, we are here to assist you with all of your real estate and mortgage needs. From buying and selling to refinancing your home, we can help you along. Our goal and my dream is to teach people how to get in the position to be financially free and with a little bit of hard work and endurance, you can get there.