Deed in Lieu of Foreclosure for Timeshare


Mountains in CanadaWhether you are facing timeshare foreclosure, or are looking for a way to get rid of an unwanted time share, a deed in-lieu of foreclosure can be a great option to get rid of your timeshare obligation. It is important to note that a deed in lieu of can usually only be (easily) obtained by an owner that has already paid off the principal balance of the property, whose only remaining financial obligations are yearly/monthly maintenance fees. If you still owe money on the property, in addition to maintenance fees, you will want to discuss a deed in lieu of foreclosure with your lender – their willingness to allow you to sign the deed instead of foreclosing depends on a variety of factors including the amount owed, frequency of delinquent payments, your personal situation and resort desirability. If the deed in lieu of foreclosure is accepted and executed in this case, the former owner may be responsible for any applicable legal fees and/or amount owed different than what the property was resold for; although I have found that many timeshare resort property owners do not take this extra legal step, as it involves a series of court orders and legal fees for their company.

For timeshare owners that own their property outright and simply want to get out their timeshare contact due to no longer traveling or not wanting to pay maintenance fees, the best way to go about obtaining a deed in lieu of foreclosure is to simply stop paying your maintenance fees. Eventually your home owners association (or HOA) will turn your account over to a third-party collection agency that will begin to use the traditional routes of communication including letters, email and phone calls in an attempt to collect the money owed. After this collection firm has used up all of their money-collecting ammunition, and it has been made clear that the owner has no intention of bringing the account current or continuing to pay, they will inform you that your home resort will accept a deed-in-lieu of foreclosure to sever all your ties with the timeshare property.

With regards to your credit in the case of obtaining a deed-in-lieu of foreclosure, your credit should not be greatly affected at all. It is an excellent idea to obtain a written statement from the lawyer preparing the document to state that the lender and/or timeshare resort property owner will not be recording or reporting this deed to credit agencies. Some lenders/property developers will not agree to this, however, so you should at the very least obtain a signed statement acknowledging that any information reported will be accurate – including the fact that there was no delinquency or default if your payments are current. This document should be signed by the parties to whom you are returning the property, and while it is not a guarantee that the deed in lieu of foreclosure will not be reported to credit agencies, it will come in handy if any errors in reporting to FICO occur.

101 Responses to “Deed in Lieu of Foreclosure for Timeshare”

  1. Shelby says:

    We have stopped paying our maintenance fees for over a year and have been threatened with credit hits, collection agencies, foreclosure, blah blah blah. We were told that we are blocked from any future reservations or exchanges with this resort. We really did love staying at this resort. Would anyone know if we booked a week there though expedia if the resort would turn us away? Would or could they have us flagged?

  2. Shirley says:

    Can someone tell me if we stop paying our deeded Sedona Pines Arizona TS, can it affect our credit We are Canadian. Will it also affect our ability to winter in florida every year?

  3. Shirley says:

    We own a deeded TS at Sedona Pines AZ, we have been trying to get rid off. We would like to stop paying maintenance fees. if we stop will this affect our credit here Canada and it chance to to winter in the US for 3 months?

  4. Whatanightmare says:

    I feel everybody pain!!! This is such a nightmare! I bought Wyndham in 2009 and it was with a co-owner. There is still a remaining balance on this and I had been paying up until Sept of this year. I stopped paying because a family issue that I have to be financially responsible for. The co-owner was not helping to pay for the monthly fee and I had to ask him to help paying. I had so many phone calls from timeshare 6 times daily. I was being responsible by explaining to them my situation and asked them to contact the other person to get him to pay. I also said if they couldn’t get a hold of him, let me know so i can find a solution. So they got in touch with the other person on the account, he paid 1 payment for November 2012 because they said that by doing that, we will have more time (about 120 days) to see if we can sell our timeshare or make payment arrangement. I was so sure that after the other person made that payment, everything will be ok. So I get random phone calls from them and I did talk to them about getting in touch with the other person. And again, I asked them to get back with me if they cant get a hold of him. They said they would do that for me. So I didn’t hear from them for a week and then on Dec 17 I called Wyndham Financial department to see what’s going on with the account, they told me that they have sent my account to collection and I need to contact them from now on. I said that I never got a notice from them and that I thought after the November payment, I still have more time to decide on what to do. They started yelling at me making me feel really helpless and stupid so I asked for the manager and the lady came on the phone and also was so rude. I got off the phone being really frustrated. Then I got a phone call right after that from a lady from the collection agency. She told me that I have until Dec 28, 12 to resolve this matter. She gave me two options: 1)pay the loan in the full amount; 2) Make an offer to pay a certain amount to do the Deed in Lieu back to Wyndham. For option #2, she gave me some really high number. I asked her how much time I have to make a decision and she said I don’t have much time, that after a few days there will be additional 40% of collection cost on top of what I have to pay. (Later on I found out from calling Wyndham again and talked to various people that once the account is at the collection agency, they will have it for 3 to 4 months and if there is no action from the account holder, they will have to send it back to timeshare and the foreclosure process will start but please don’t quote me on this because at this point, reading everyone comments, we all know that timeshare lies!!! – Please Note: always get their name, ID number, direct phone number or extension, record time and date and the content of the conversation and everything they tell you and everything you ask them) The lady from the collection agency also told me that she is the only one that I could talk to, making me feel very pressure and helpless. And she told me that I have to get back to her by certain time during that day. So I did call back that day with a help of a very sharp person, he got more answers from this lady but she still put pressure on us. I said I had to get back with her the next day. So, the second day, I was trying to look into legal issues regarding these options I have. I have found a lot of useful info: 1) If I choose to pay off my loan with timeshare and give it back to charity but that would cost me about $3500, but there is a tax benefit. 2)Liquidation: costs about $2500, no tax benefit 3)Deed in Lieu: pay 25% of the amount you owe, but before transferring the deed or need to get a lawyer to draft a letter to timeshare to make them promise not to report your status as DIL and take off all the negative remarks of your credit report and release you from all of their obligation; NOTE: make sure to ask them if the amount you pay will cover maintenance fees, tax fees, any fees from them cuz you don’t want to get a letter from them later on saying you are still in collection of some sort of fees. I have lost 3 days of work trying to deal with this, can’t eat, can’t sleep… At this point, I still think I need a lawyer. I have been calling everywhere and there is no lawyers available. It’s the holidays but also, it seems to me that no one wants to handle timeshare case. So if anyone have any suggestions or recommendations, please feel free to do so. I hope everyone is doing well..No more buying timeshare.. and please tell everyone you know not to get into their traps! Also, how do I get the co-owner to pay for the fees? Thanks

  5. bbattle says:

    I own a Mariott Timeshare, have not paid for maintence fees since 2008 I owe $3423 what’s my best option request a deed-in lieu or let it go? I was awarded this timeshare in divorce settlement, what is the worst that can happen?

  6. Becky says:

    Your situation sounds very similar to ours. We have 1M points and owe about $75,000. We quit paying in March. I have discussed DIL with several reps at Wndham who didn’t give me much hope for DIL. Did they also give you this song and dance? How did you finally get them to agree? Thanks for any advice you can give.

  7. Marie says:

    We bought into Wyndham years ago and have even upgraded, not always happy with the sales pressure but did enjoy our vacations. We have over 500 pts and was told our ts was worth over $100,000 and we owe $20,000. My husband lost his job, had some medical issues and couldnt find another job for over a year. We were hurting financially, losing our home. We tried renting points out but didnt come anywhere close to covering costs. We advised Wyndham of our problems and sent a hardship letter but they said they didnt care. We even requested if they could reduce our points to show paid for we could pay mf. They didnt care. Wyndham has been worse than our actual mortgage company. We have not paid since 6/2011 except for 1 payment in the fall when they convinced us they wouldnt call for 2 months if we made a payment. We struggled that month but made a payment and we got as many calls as we did before. They lied to get their payment. We get 7-8 calls a day from Wyndham asking for payment. We will not pay them anymore money. They say we have 25 days and they will turn over to collection agency. I cant imagine calling anymore than they already do. We are hoping for a foreclosure so the calls will decrease. Other than changing our phone number, anything we should do at this point. We cant afford to pay anymore, we need a house to live in a little more than a vacation.

  8. J A Long says:

    So, my wife and I foolishly bought into Wyndam Bonnett Creek (Near Disney in Orlando) back in 03. Talk about high pressure sales – we were trapped for almost 6 hours. In retrospect, we should have walked away but it was like being a hostage. Since then, we have tried to book time at that resort and others to no avail. No availability for any time we’d be able to take a vacation – we gave up even trying several years ago.
    Ours is paid off so we’re only in maintenance fee mode. Anyone else have any experience with Wyndam and how quickly a Deed in Lieu of Foreclosure will go into effect with the new Florida law? My plan is to stop paying the maintenance fees and walk away from this complete waste of $$. I absolutely do not want to take a chance trying to get any other blood sucking service involved and just want to force the hand of Wyndam.

    • john says:

      your situation sounds a lot like mine. I have been advised by my attorney to just not pay and see what happens. Sounds like the worst is foreclosure and a hit on my credit of about 250 points.
      small price to\pay to get out of this .

  9. shawna wiley says:

    I never recieved a 2012 maintenance fees still owed for 2011 went online to pay fees and says its under forecloser we would like to pay fees but there is alot of legal fees in there can we pay this minus legal fees and not be forclosed on?

  10. Johnnie says:

    I just talked with a rep from Donate for A Cause about donating my 154k points of Wyndam. They told me they would take it but I would have to pay $3500 plus the remaining maintenance fees for 2012. I thought I could just donate it and that would be it but no it still cost. The only upside is that it supposedly is tax deductibe. I will talke with my accountant before I do anything.

    • Dr. Jose says:

      I just stopped paying on my 1 million point Wyndham contract with $88k mortgage balance. It took a year but I finally got my DIL.
      You said you only have 154k points. And you still owe big maint. fees.
      And you can’t get anything decent, anywhere decent (but FAirfield Glade). Consider just ‘STOP PAYING’ Seriously, If you have to PAY to DONATE then you are cheating yourself. Research the ‘STOP PAYING’ method. It will take a year but you will finally get your DIL.
      It worked with me and now instead of PAYING Wyndham $14k+ every year I SAVE it. With 4 months savings this summer I am going to go back to Oceanwalk Daytona but instead of staying @ Wyndham we have 3 suites next door @ the HILTON. And I still have spending money and savings. Seriously, don’t give Wyndham another dime.

      • B Edslk says:

        Dr Jose — i hve sim sit at Marriott – i have not made payments – hardship, lost job plus Cancer – I owe Maint Fees they say they will not due DIL unless fees are current $4600. That is money I can’t afford but if it is only way. I have heard Tax consequences are awful IRS treats dif in LOAN Mtg and forgive as INCOME – clearly I need to choose without making mistake — at wits end

        • Hans says:

          Something to think about. Say you owe $600 in Maint and it goes to the IRS and ultimately to you as income. So what? You pay your normal tax rate on $600. If you’re retired that may be anywhere from 0 to maybe 22%. I’d say paying $120 to the IRS is better than $600 to the resort. And at some point I’m guessing the resort would stop the whole process if it drags on for years. And at this payment rate, you can pay the IRS for 5 years before it adds up to just 1 year to the resort. Do the math. The IRS isn’t all that scary if you just pay them.

      • Johhnnie says:

        I am going to take your advice and stop paying in January 2013. I’ve schedule a 2012 vacation for my daughter so I don’t let it go to waste. I’ve got my house paid for so I don’t have to worry about them getting a lein on my home. My credit might go to hell in a hand basket but oh well. Wyndam will not see another dime from me after December 2012!

      • RCCC says:

        Dr. Jose…what reason did you give Wyndham when you stopped paying? Did you communicate at all? Did it affect your credit? What process occurred during the year before you finally got the DIL, lots of calls and letters? You still owed a lot, did they try to sue you?

        Please share your experience..thanks!

      • A Bash says:

        Dr. Jose.. We are very interested in how you got the DIL from Wyndham… What reasons did you give when you stop paying? We currently owe them they call each month.. Need help. Any help would be appreciated!

      • Oeduard says:

        Dr Jose…. after you got your DIL, did they ever bothered you since then? Because im planning to do the same and hopefully be rid of this problem.

        • Carol says:

          I bought timeshare in2008, I stopped paying 2009 bec of financial problems. Now they are offering me a settlement of 2500 to cancel the mortgage. But a note says that this settlement will not cover the past maintenance fees. I’m afraid if I pay this, they will come back later and ask for the previous years of maintenance fees. What should I do? Will the timeshare just automatically be foreclosed? Do I need to file anything? Or just ignore everything and they will foreclose it?

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