From Large Companies To Smaller Resorts, Find Out If A Buy Back Program Is For You
Currently 9.2 million Americans own at least one timeshare and at exponential rates many of these owners are looking for viable ways to release their timeshare ownership without serious financial repercussions. Owning a vacation destination within a saturated market makes resale a limiting option, but there are several ways to securely cast away the burden of timeshare ownership, including buy back programs.
There are several reasons why a timeshare owner would want to release their vacation ownership and the timeshare industry is changing rapidly as large companies are beginning to adapt to the changing needs of owners. Whether owners were seduced into buying the timeshare without wanting it in the first place, or if monthly maintenance fees to resorts has become a financial burden, or perhaps lifestyle changes means that the vacation unit is not being used anymore: Regardless of the reason to offload timeshare ownership there are several options for owners and a buy back program could be for you.
The success of a buyback program will depend on a few key factors:
- Does the company that you own your timeshare program with
participatein buy back programs?
- Are all of your maintenance fees and timeshare mortgage paid in full?
- Is your timeshare vacation destination popular and is there high demand for units in the resort or hotel?
Find out which timeshare companies offer
Timeshare Companies That Participate In Legitimate Buy Back Programs
Westgate, Wyndham, Marriott, and Diamond Resorts all offer official buy back programs. Disney, Hilton, and Hyatt do not officially have buy back programs but have been known to work with owners to find an exit strategy that may include a buy back program. If you own a timeshare anywhere in the world with any of these companies the chances of participating in a buy back program are high.
Wyndham alone boasts nearly 1 million owners, which, makes them the largest timeshare company in the world. In 2017 Wyndham launched their Ovation program. This afforded owners with their accounts in good standing to exit their timeshare with a profit. As with most real estate exchanges there are several stipulations to be aware of before moving forward with a buy back program.
Diamond Resorts, not long after Wyndham came out with their Transition program, offering owners an exit plan that was mutually beneficial. More timeshare companies are adapting to the needs of owners and are willing to buy your timeshare back from you.
Most companies will buy back your timeshare for less value than what would be indicated by the market value. Although you will sell your timeshare back to the company for less money, remember that resale of timeshares is difficult and you may be waiting years to get a bite. It might be worth more to sell your timeshare back to the company for less money than to wait months or years for a resale. Ultimately, depending on the urgency of sale you will need to decide for yourself if the lower payment of a buy back program is worth it for you.
Timeshare expert Jeff Weir, Redweek’s chief correspondent, has outlined several examples of buy back programs through Marriott. These examples should give you an idea of what to expect in terms of a return on your timeshare buy back:
· “Example # 1: Maui Ocean Club, Lahaina Villas, annual floating deeded week in a two-bedroom, two-bath, oceanfront unit. Marriott Vacation Club (MVC) recently offered to buy this interval for $10,200 minus a $500.00 administrative fee and Hawaii state tax of 7.25 %. The offer applies to the 2020 usage year, which means that the owner would still be responsible for all 2019 fees and usage rights.
(Prices for identical intervals typically range from $29,000 to $40 000. The average selling price for this interval is $22 326)
· Example # 2: Marriott’s Waiohai Beach Club, Kauai, an every other year (EOY) floating deeded week in a two-bedroom, two-bath garden unit. MVC offered $3250, minus $500 administrative fee.
(The price range for identical weeks is $3950 to $9500. The average selling point is $4678)
· Example # 3: Marriott’s Newport Coast Villas in California, annual floating week in high season, two-bedroom, two-bath, ocean view unit. MVC offered $5000, minus $500.00 administrative fee, for a net of $4500.
(Identical units range from $3590 to $11 000. These units typically sell for $8415)”
As you can see, the aforementioned data shows that buy back programs will offer less than the expected resale value. If there is not a great urgency to release your timeshare then it may be worth the wait to sell your timeshare through the real estate market. If, however you are looking for a speedy way out of your timeshare it may be worth engaging a buy back program even if the return is lower.
Although, each major timeshare company will offer different buy back programs you can expect to receive a similar offer as seen in the above examples on your timeshare unit.
In order to participate in a buyback program from any large timeshare company all fees must be up to date, and the primary balance of your mortgage must be paid in full. If you have outstanding payments there is no major company that will consider a buy back program. If you owe money on your accounts, then consider an alternative option to cast off the burden of your timeshare.
Negotiating A Buy Back Program With A Smaller Timeshare Company
If your timeshare ownership is with a smaller company and you are unsure if they will participate in a buy back program you must contact them directly and find out what they will offer. Smaller timeshare companies may not have a buy back program in place, but if your timeshare is secured during a prime vacation season and if your unit is in a full vacancy resort, the company may be willing to buy back the timeshare from you.
You will need to speak to the administration directly to find out if a fair negotiation can be found. Many companies will be willing to buy back your timeshare if there is a high demand for your unit. As with large companies, all maintenance and condo fees must be up to date and the mortgage must be paid in full.
If you decide to move through a buy back program with a smaller company, enlist the aid of a local real-estate attorney to ensure that the transfer of title and deed is successful so that you will be free from any financial obligations to the resort or hotel.
Unfortunately, if your timeshare is not in a high demand location or if you have a fixed week during low season, most small companies will not buy your timeshare back. If this is the case they may take the deed back for free provided your accounts are in good order.
Alternative Options To A Buy Back Program: Deed Back Programs, Rental, And Charitable Donation
A deed back program is simply the transference of title and deed back to the company. You will not profit from a deed back program but you will be relieved of the monthly and annual fees you are paying on your timeshare.
The circumstances of a deed back program vary greatly and many timeshare companies will not participate especially if your timeshare unit, either because of the season of the year or the location, is not in high demand. Certain companies, especially in busy resorts, will offer you a deed back program. This means that you give your timeshare back to the company and are absolved of any future financial obligations to the company.
If you are looking to quickly get out your timeshare because maintenance fees are too high for your financial situation or because you no longer use your timeshare, a deed back program may be for you. Similar to buy back programs, all fees and payments must be up to date and mortgage must be paid in full.
If the timeshare company is unwilling to participate in deed back program or a buy back program some charities do accept the donation of your timeshare. This will relieve you of high monthly maintenance fees. Again, before you can donate your timeshare you will need to be up to date with all fees and have nothing owing on the principle of your timeshare.
Finally, if you are unable to offload your timeshare via buy back or deed back programs then consider renting your unit out. If you are behind on your payments the rental income can help you catch up on payments by renting the unit out for more than the maintenance fees. Renting your timeshare out requires some work as far as ensuring that the unit is fully equipped and adequate to be rented for vacationers. If you are willing to put in some legwork then renting your timeshare could be lucrative enough to pay ongoing maintenance fees and pay off anything still owing on your mortgage so that you can eventually release your timeshare.
Third Party Buy Back Programs: Something To Avoid
Several third party companies will offer a buy back program. Unfortunately many of these companies will demand a high upfront fee and if this is the case: WALK AWAY. Many of these companies will scam you of your money and still leave you with the deed on your timeshare.
While most third-party buy back programs are scams, some companies are legitimate. These honest buy back companies tend to be highly restrictive in what they will buy back.
In general proceed with caution if you are interacting with a third party buy back company and never provide money up front. Be thorough with your research of the third party company and be prepared to walk away from any deal.
Releasing Timeshare Ownership Through Buy Back Programs Is More Accessible Now Than Ever
For decades timeshare owners felt trapped with their vacation unit, unable to offload the financial burden of high maintenance fees. Fortunately, times are changing and the leaders in the timeshare industry are beginning to offer buy back programs for owners.
Although the buy back programs are not as profitable as some owners would like, they do provide relief from the burden of timeshare ownership and could be the best way for you to unload your timeshare.
All companies will require that maintenance fees are up to date and that mortgages are paid off. Even if your timeshare company does not offer specific buy back programs some will be willing to negotiate terms for a buy back.
If you are desperate to release your timeshare and the company that you bought from is unwilling to buy back your timeshare, they may be willing to offer you a deed back. Although you will not turn a profit, you will be released from any owner responsibility.
Some charitable organizations do accept timeshare donations and this may also be a suitable arrangement for you if it is imperative that you are released from your timeshare ownership responsibility.
While all buy back, deed back, and charitable donations require that your accounts be up to date, if you still owe money on your timeshare either through late maintenance fees or a mortgage, then you may consider renting your unit out. This will require some work but ultimately could put you in a better position financially to sell your timeshare or to find a buy back program.
The unique circumstances of your timeshare ownership will dictate whether a buy back program is for you. Releasing a timeshare in 2019 through a buy back program is easier than ever. As with all real estate transactions, take your time reading all the fine print to ensure that you will be relieved of all timeshare ownership responsibilities.