Learn about your rights as a timeshare owner.
One of the biggest complaints that we hear from our clients is the rate by which their annual dues seem to escalate with each passing year. Worse yet, there is no apparent justification given for these increases.
Let’s do some basic math. An average resort may have 1,000 units, and charge an average of $1,000 per year for ‘maintenance fees’. Assuming no overbooking occurs – not at all a foregone conclusion in this industry – and do some fairly straightforward math: 1000 units x $1,000 per year x 52 weeks = $52 million dollars. Common sense tells us that there are very few things that cost $52 million in order to ‘maintain’.
And although there is little transparency in this process, it is fair to infer that the timeshare developers are often diverting these funds to general operating revenues.
But the fact is that, as a timeshare owner, your developer has a legal, fiduciary duty to properly allocate these funds towards resort maintenance. And you have the right to an accounting of these funds. Thus, the developer (which is almost always the resort manager) can be forced, in a court of law, to render such an accounting. This gives you tremendous leverage, as a frustrated timeshare owner, to force a rescission, because the last thing your developer wants is to open up its books and records to scrutiny, much less in a public forum such as a court of law.
The presumption is that the developer would much rather cancel a single timeshare interest than risk the compulsory disclosure of its general handling of ‘maintenance’ fees. Accordingly, any demand for a rescission of your timeshare contract should include a demand for an accounting of annual dues as well.
Please call us free of charge at any time to learn about your rights as a timeshare owner and to discuss your legal options.