Timeshare Scam

I got fooled recently by a letter I personally received in the mail. It appeared to be ‘official’ and appeared to require me to file a certain form with a state agency. Yet because the letter almost made sense, but didn’t quite, I called a financial advisor with questions about it.

He said, “It’s garbage. It is a marketing come-on from disreputable company. If you call the number in the letter, you will get someone trying to sell you services you don’t need, designed to fulfill requirements that aren’t really required. Throw it away, or better yet, send it to the State Attorney General’s Office and file a complaint.”

Although relieved I didn’t have to add one more task and one more expense to life, I was also annoyed—really annoyed both with the disreputable company that had done this and with the fact that I almost fell for it. Luckily I didn’t. I escaped the ploy without throwing away any of my money.

But the experience served as a good reminder for how many consumers must feel when they try to deal with timeshare, whether they want to buy timeshare, resell timeshare, or rent timeshare.

Identifying the Reputable Timeshare Sales Companies and Timeshare Brokers

1. Look for history. Timeshares themselves are still a relatively new concept in the marketplace, not available before the 1960’s and with the global hospitality brands not moving into timeshare and vacation ownership until the late 1980’s and the 1990’s. So while there are no ‘oldies’ in the business, there are companies that have at least been around five to ten years in timeshare resales and brokerage, and longer than that as timeshare developers. A disreputable timeshare company often has to shut its doors and reopen under a new name, once, twice, sometimes even more than that. SellMyTimeshareNOW, LLC (also seen in our communications as Sell My Timeshare NOW) has been doing business successfully and consistently under the same name for more than 7 years.
2. Look for strong professional affiliations. Reliable timeshare sales companies are members of and are actively involved in the premier professional organizations for the timeshare industry, including ARDA, the American Resort Development Association and CRDA, the Canadian Resort Development Association. Sell My Timeshare NOW is a member of and is now or has recently served on various panels and committees for both associations.
3. Look for specific numbers not empty claims and promises. Because there are many naysayers out there, who want you to believe that it is impossible to sell timeshares, it is very important for a timeshare reseller to communicate the truth in precise numbers. Questionable timeshare companies will tell you they have offers for hundreds of timeshares or thousands of timeshares on the resell market. Sell My Timeshare NOW will tell you that in 2009, we generated 61,743 offers to buy timeshare resales and 85,949 offers to rent timeshares
4. Finally, look for validation from experts and professional agencies. If you are not sure about a timeshare sale or timeshare resales company with which you are considering doing business, do exactly what I did when I got the questionable ‘con’ letter in the mail from a business in another industry—turn to a third party expert for validation. Contact the Office of the Attorney General for the state or states the company does business in; ask questions of industry experts. Beware of random information you find on the internet that attacks a brand or company; sometimes it is created as an attempt at competition by the very companies you are trying to avoid—the con artists. Sell My Timeshare NOW never targets attacks on other companies; it is unprofessional and it is a waste of our time to put it out there and a waste your time to read it.

Sell My Timeshare NOW obtains formal legal advice from the highly respected law firm of Baker & Hostetler LLP, affirming that the business practices of Sell My Timeshare NOW and Timeshare Broker Services are in full compliance with Florida real estate brokerage laws. Sell My Timeshare NOW is counseled by Robert J. Webb, RRP of Baker Hostetler, a board certified Florida real estate lawyer with substantial experience in commercial real estate, timeshare and hospitality industry law.

The facts speak for themselves.

Readers of The Timeshare Authority blog are always looking for updates on Singapore timeshare, perhaps because the country has struggled in working out government guidelines to protect Singapore timeshare owners from timeshare scam. Now it seems that unscrupulous fraudsters have used yet another tactic to take advantage of loopholes that exist in the regulation of Singapore timeshare sales.

Companies representing themselves as legal firms are contacting some timeshare owners. These companies have purchased timeshare owner information illegally on the black market. More importantly, they are not attorneys and they are not law firms, even though they tell consumers that a legal firm “is the same as” a law firm.

These ‘legal firm’ companies operate by cold calling timeshare owners to ‘surprise’ them with the good news of how their Asian timeshare has appreciated in value, often claiming the property to be worth double or triple the amount the timeshare owners originally paid. Their next step is to require the timeshare owner to make one or more deposits of funds for purposes of conducting the sales—sales that never materialize.

Here’s red flag number 1: Reputable timeshare resales companies do not cold call their clients.

Red flag number 2: Timeshare rarely appreciates. It is far more likely that, just like the car you drive, your timeshare has depreciated significantly since you purchased it.

And finally, red flag number 3: When you are selling timeshare with a reputable timeshare broker, you will never be asked to front expenditures of the sale. Costs of the timeshare sale transaction should be paid from the proceeds of the sale. The only time you should consider paying prior to the sale of your timeshare is if you are advertising your timeshare on a by-owner basis and have advertising and marketing costs to cover.

Protecting Timeshare Owners

While the Consumers Association of Singapore (CASE) does not have numerous reports of timeshare owners scammed by the pseudo-law firms, no one knows how many other people have been duped and have not come forward to report it. In one instance that CASE did investigate, they found that the legal firm was a company operating under the name of a bar and pub one day and as a ‘legal’ firm the next—public record information the consumer could have discovered had he or she done even a small amount of research first.

At this point, problems in Singapore continue as timeshare sales practices have been tops for six years on the list of complaints that CASE reviews. You can learn more about CASE’s “Knowledge is Protection” Campaign here: http://www.case.org.sg

Other related Singapore timeshare news:

Singapore Timeshare Will Benefit from Tougher Laws

Singapore Timeshare Alert

The Consumer Association of Singapore (CASE) says that time will make a difference. Although the country continues to work to cleanup timeshare and real estate sales practices, changes don’t apparently happen overnight. Unscrupulous property agents in residential, commercial, and timeshare real estate remain in the top ten professions about which Singapore consumers complain.

In 2009, CASE received more than 1000 complaints against property agents for unsatisfactory service and misleading claims regarding real estate transactions. Singapore timeshare complaints in general still top the list of all grievances brought to CASE, with over 2500 complaints annually.

In 2006, The Timeshare Authority blog reported to you that Singapore timeshare complaints for the previous year had reached 2500.

In a December 2, 2006 timeshare blog post, we wrote:

“A frequent tactic of an unethical Singapore timeshare deal involves charging consumers between $30,000 and $50,000 for lifetime timeshare vacation memberships. For this expenditure, the timeshare buyer gets one week of timeshare vacation annually. Not only is this timeshare deal a bit pricey, but it includes the caveat that vacationers schedule their holidays one and sometimes even two years in advance.”

Sad to see that after five years of Singapore regulatory involvement, the number of complaints has yet to decline. To be fair, perhaps the number of overall timeshare sales has increased significantly, (information we don’t have). If this is the case, the percentage of complaints might have actually declined, a possibility that seems even more plausible in view of the fact that in first half of this year, Singapore boasted the fastest-growing economy in the world with a GDP of nearly 18 percent.

Related Update on Singapore Timeshare

In September, the RDO (Resort Development Organisation) issued a statement saying it had no affiliation with two Singapore timeshare companies: United Wealth Management and Beaufort Park Pte Ltd may. Reportedly, representatives of both companies had told timeshare owners that their companies were registered with RDO.

The timeshare industry can’t be guilty of pointing fingers. I’ve been in the timeshare resale business for seven years now and every year I see the same cycle: some developers pointing fingers at the resale companies for all the fraud that has happened while some resale companies point fingers at the developers for creating the problem to begin with.

Let’s face it, solving resale is challenging or it would have already happened. For starters, the days of pretending the secondary market does not exist are over. The internet has brought unprecedented transparency into the secondary market. People are bringing iPhones and Blackberries to sales presentations and that’s not going to change; they have on-the-spot access to the asking prices of timeshare resales and to owners’ forums and blogs which are loaded with in-the-trenches advice.

Changing the Timeshare Sales Model

The industry will need to move away from the antiquated and highly inefficient tour marketing model. Today’s consumer does not like to be “sold”. There is still robust demand for the product but one of the reasons the secondary market is growing while much of the primary market is largely struggling is due to both the consumer unfriendly sales process and the value one can receive in buying resale that is not overloaded with marketing costs.

1. The primary market can still thrive, but to do so they must better leverage the internet and eliminate inefficient and ineffective marketing.
2. While many brands have been surviving on current owner sales, this is not sustainable long term.
3. The industry must evolve to meet the demands and expectations of the new generations X and Y, and the changing demands of an increasingly tech-savvy Baby Boomer generation. Personally, I love timeshare–grew up going on timeshare vacations, but I would never go on a timeshare tour. I (like a growing number of consumers today) use the internet to do my research and ultimately make most of my purchases online.

The Timeshare Resales Solution and Where Developers Fit In

Developers should be, and many are, looking at their responsibility either to provide a resale solution in-house or partner with a resale company they vetted to refer owners to when the timeshare owners are ready to sell. While no developer wants to recommend the wrong company, not recommending anyone is even worse. Without guidance from the resort they purchased from, timeshare owners can fall prey to any number of outright scams.

Here’s What Timeshare Resales Companies Must Do

The resale companies also have a responsibility to be more transparent and offer “success based” options. While Sell My Timeshare NOW has built a good business offering owners a for-sale-by-owner advertising option, I also believe that it is important to provide owners with a “no up-front fee” option.

Sell My Timeshare NOW partners with several developers and successfully offers their owners both options. In fact, we are currently transitioning our entire business to offer more success fee-only options to even more owners. Legitimate resellers should support reasonable regulation and should be willing to be transparent where and when they feasibly can be.