ATTORNEY GENERAL ALERT: Timeshare Resale Scams
January 25, 2018
LITTLE ROCK – Con artists are playing the odds and cold calling Arkansans about selling their timeshares. While many Arkansans do not “own” a timeshare, those who do may fall victim to this scam. The callers are preying on consumers who may be surprised by expensive annual maintenance fees, difficulty exchanging specific dates or locations or that property values have remained the same or decreased when they thought they would increase, and want out of their timeshare agreement.
A timeshare is a type of property in which an “owner” buys the right to use it for a contractually-designated period of time and are commonly condominium units located in a popular destination city and often have multiple “owners.”
“Timeshare ‘owners’ who find themselves wanting to sell their portion of the property are often left confused and may believe this is an easy way out,” said Arkansas Attorney General Leslie Rutledge. “Consumers must beware of these scam artists promising the quick sale of the ‘owner’s’ portion of the timeshare. Legitimate businesses can help consumers sell, but Arkansans must do their research to find reliable sellers.”
Attorney General Rutledge released the following tips for Arkansans looking to resell their timeshare:
- Beware of timeshare unsolicited resellers contacting you with the promise to resell your timeshare.
- If they say they have willing buyers, it is probably a lie.
- Never pay a substantial advance fee for resale assistance. A reputable seller will charge a commission paid only upon sale, like a normal real estate transaction. An advance fee may be called a marketing fee, a listing fee, an internet advertising fee or other related fee.
- Get an independent appraisal from a licensed appraiser before agreeing on any resale assistance contract.
- Deal only with licensed agents.
The timeshare industry has become a popular platform for a number of con artists to take advantage of ‘owners’ desperate to sell. They claim to offer assistance in selling the timeshare and take away the burden of the continuing costs of ownership. These operations collect hundreds or thousands of dollars in so-called deed transfer or marketing fees but never complete the sale.
The timeshare industry was rapidly expanding in the 1970s and 1980s, which resulted in an overdeveloped market and flood of properties that now have depressed values. These circumstances make the resale of timeshares difficult. Like the real estate market, the timeshare industry fluctuates and is unpredictable.