If you have ever financed a timeshare purchase chances are you are paying way more than you think!
The worst possible situation to make a large purchasing decision is during the “timeshare presentation”. Think about all the cards stacked against you. You have been having the time of your life, you have enjoyed wonderful accommodations, great meals, and now the pitch. And if $19,000 is too much to pay on the spot (the average cost of a timeshare) then they can finance it for you. You have financed a car before, right? It likely does not work the same way with a timeshare.
Many of the top timeshare developers like Marriott, Hilton, and Bluegreen use major credit card companies to finance their timeshare sales. The first typical six months of payments are okay. However the interest rates jack up later and make the timeshare harder for the buyer to afford.
Meanwhile, the timeshare developers are deferring their taxes and stretching out their tax on sales over several years. By doing that they save millions in taxes.
I am no accountant. But it looks like this business model is set up to benefit the shareholders. The timeshare owners? Not as much.
Timeshare owners then have the experience of increasing monthly payments, annual maintenance fees, and the unwelcome surprise special assessments when hurricanes roll by.
What is a timeshare owners to do? You do have a few choices. Sometimes you can refinance the timeshare through your Credit Union or bank. They could possibly give you a better deal than what the timeshare resort developer has done. That would save you a considerable amount of money in interest payments alone.
By then, some timeshare owners are getting so frustrated and annoyed by the whole deal that they let the timeshare get foreclosed on. Bad idea – for all the reasons you can imagine.
On the other hand if you had a timeshare resales specialist working for you to find a buyer for your timeshare, maybe you could get your timeshare sold for enough to pay off the loan.
There is a market for timeshares on the resale market. Buyers are looking for deals. Sometimes they give ridiculously low offers and nothing comes of it. But some timeshare buyers realize the discount they are getting compared to the timeshare developer and make the deal. NOT paying retail price is a good thing!
If you are in a bind with your timeshare, sell it. Once it is done you will be glad you did.