-by Dr. Ken Rich
Irregardless of philosophy, “what should be”, or greed the mechanics are the same. There are many levels of getting rid of your timeshare. Test each one and decide which is best at this point in time. Consider time because it will cost you more fees if it goes until next year. Never believe anyone will accept your timeshare and pay off your mortgage or past due fees. That won’t happen. It must be free and clear and paid up.
Keep in mind that the after market buyer is looking at it not as a resort, but as a perpetual future annual bill they are taking on.
1.) DIRECT SALE. You find a buyer willing to pay an acceptable sum to you for the timeshare without having to pay any listing fees. This is usually done through some realty company that will try to get it sold for you on a commission only basis. You pay NO up front fees, get the cash at closing, and control what you will accept. The downside is that it usually takes a long time and only works on the very best units and weeks at the very top resorts.
2.) TUG. You join a forum or TUG (Timeshare Users Group) and post it on their site for a small membership or listing fee. This won’t get you any more money, but the members usually are experienced and can tell you what to expect. There are members who keep and use their timeshares and, when the price and annual fees are low enough, will pick up more they think they can use. The cost is minimal. The viewing is reasonable and includes people experienced with timeshares. Those viewers know the low prices they can pay so your receipt will probably be lower.
3.) ONLINE LISTING. You decide to pay a fee to a listing company online. This can range from as low as $15 to as much as $950. The difference is how many hits they get online. This doesn’t mean it will sell, especially if you set a price that you initially think is
reasonable. The vast majority of these end up never selling.
4.) EBAY. Post it on eBay. When you do, look at the advanced settings to find out what your resort has actually sold for during the last year. You’ll find most go unsold or sell for $1. There are dealers out there who you compete with selling for $1. The large majority go unsold. This is essentially the opportunity to give it away for FREE if you’re willing to do that. Even then often there are no takers.
5.) DONATION #1. Most charities do NOT take title. They turn it over to their broker and try to sell it for you. This is up to the charity. If it sells, the IRS says they keep the money and you can only deduct that actual cash received, not your original cost or any other amount because value is established on that unit. If they don’t believe they can sell it quickly (usually in two weeks) they won’t even accept it. If they do take it, you’re still on the title and hook until it’s sold. You can contact a lot of charities quickly to see if they think they can sell it. Most will have experience and tell you quickly instead of stringing you on.
6.) DONATION #2. A very few charities will actually take title to some timeshares which gets you out of it. Usually this is if they can use it to rent or use and they are willing to take on the obligations of ownership fees. There are two variations. First is if the timeshare is a top unit and week at a top resort they know they can rent out for more than the annual fees. Second is where the charity doesn’t care about use or resell because they charge a fee from $500 to $1,000 to take title to make their money. This costs you money, but the timing is not up to whether it sells or not. The IRS says that if they keep it for 36 months you can take a $5,000 income deduction for the donation so your tax return can offset the out of pocket costs of transfer. The benefit is you are finally free – for a cost. Make sure you don’t pay the charity until title is actually transferred.
7.) COMMERCIAL RELIEF. This include several companies that charge from $4,000 to $7,000 to take the timeshare off your hands. They sometimes advise you to deduct your purchase cost as an investment loss, but watch out, the IRS specifically opposes this. The benefit is you get out fast. The downside is it costs a lot. One problem is that even they have a list of timeshares they won’t accept.
The important key is that you can get out of your timeshare, but it will take you time, humility and maybe some money. There are very few prime units and weeks at the specific top valuable resorts. Most of them have original costs in the $50,000+ range. The faster you want out a beautiful, but normal resort, and the more humble you are on price will determine which of the above steps you need to consider.
Dr. Ken Rich
Containing a potpourri of subject matter, included in this Hot Cuppa Joe section are articles about sales & marketing, in depth industry-specific news, first person reports on resort destinations and more. To see everything in this category, click here. If you have something you'd like to contribute, email firstname.lastname@example.org We'd love to include you!
Copyright Inside the Gate. All rights reserved.