Advice on how to eliminate my timeshare

cm_mc · Apr 22, 2015

Going a few months back (http://tugbbs.com/forums/showthread.php?t=180600&page=2) I asked on any advice on how to get rid of my timeshare, or at least stop making the payments on it. After getting all my ducks in a row, I am ready to take the hit of a possible foreclosure and a giant credit score hit, worst-case-scenario. But I thought I'd make one last stop here before it actually happens. I was given the advice [see link] to ask for a deed in lieu of foreclosure, even though that is extremely unlikely to happen, and was told to do it in writing.

Is it ok to have the same communication via email, as to have a "paper trail" proof, should they decide to go through with the deedback and decide later on to come after me for what I owe them? I would find it very time consuming to do it via snail mail. Or does it have to be through letters for legal reasons? Any advice is welcome TIA!

DeniseM · Apr 22, 2015

OK - you posted 7 mos. ago - I'm unclear on what action have you taken since then?

Passepartout · Apr 22, 2015

cm_mc said on September 23, 2014:
"So, through some brief Google searching, Ive found that it might be possible for them to offer a "deedback" after it is 90-120 days delinquent in payments, is this also a slim-to-none chance?"

So did you default for those 90-120 days? Have they been in touch wanting you to pay-up or face foreclosure? Have you paid the MF?, Have they cancelled any reservations you made with them?

Jim

Reviewing additional posts, the lack of the OP holding the deed pretty well eliminates the 'deedback' option.

Please keep us informed on how this works out for you.

Saintsfanfl · Apr 22, 2015

The problem is the OP bought a timeshare on a mortgage, and it wasn't even 2 years ago. They barely made any mortgage payments, if any at all. They paid a scam company to be rid of it only 4 months after they bought it. More money down the drain. The maintenance fee is but a pittance compared to their loan, but that likely was unpaid as well.

Unfortunately there isn't anything they can do but let the process take it's course. When you buy a timeshare on a mortgage and then decide only 2-3 months later that you will not use it "in the near future" and the payments aren't worth it then there is no recourse. It's not any different than buying a car and not making the payments 3 months later. The basic timeshare "deceit" no longer matters, or at least that's the way I am interpreting it.

theo · Apr 23, 2015

Saintsfanfl said:
<snip> Unfortunately there isn't anything they can do but let the process take its' course. When you buy a timeshare on a mortgage and then decide only 2-3 months later that you will not use it "in the near future" and the payments aren't worth it then there is no recourse. It's not any different than buying a car and not making the payments 3 months later. The basic timeshare "deceit" no longer matters...<snip>

Exactly so; this is a correct and concise summary of the OP's unfortunate situation.

With an outstanding loan / mortgage present, "deedback" is not even an option, since OP has neither the deed nor the legal standing as owner to sell it, give it away or give it back in the first place. Default and foreclosure are likely inevitable at this point, unless the OP can (and / or even wants to) to pay off the note balance to thereby acquire the legal standing to do anything else with the "product". Paying off the note, if even option for the OP, would probably be a very expensive and unwise alternative to just letting default and foreclosure proceedings unfold on their own, with some negative credit reporting unfortunately following shortly thereafter.

cm_mc · Apr 24, 2015

Sorry for the late response, I was busy these past two days. The TS company have barely started calling me at least once a day for the past week or so to collect this month's ("late") payment, that I don't plan on paying. I have yet to pay any MF's this year, but I'm sure they're calling about that too.

I also didn't know that I was unable to even offer a deedback if I was not in "good stance" with the TS company. At least that's what it seems like from the previous responses.

I would like to know what my next action step would be, if any, or to just keep ignoring them, and let it default and have a foreclosure on my record. TIA

TUGBrian · Apr 24, 2015

unfortunately if you are already in default on your fees, nearly all options to "get rid of" your timeshare without some sort of negative penalty are already out the window if you have no intention of bringing them current.

you could of course make it perfectly clear to the resort that you are done paying and leave it at that...and run the risk of them turning you over to collections, damaging your credit, etc etc...or eventually asking you to give the week back.

however from your reply, it seems you have not even attempted any of those options?

uscav8r · Apr 24, 2015

Advice on how to eliminating my timeshare 100%

You'll have to determine the difference between the outstanding loan balance and what a hit to your credit score will cost you in terms of higher auto and health insurance rates, home mortgage rates (or ability to qualify for a home loan), credit card rates, etc. for the next 7 years. The latter may be more expensive than the former.

If you can pay off the loan, at least you have a fighting chance to do a deedback or sell the thing outright to get out from the MF obligation.

If you are in good standing, you can also try to rent a high value week. Even if it doesn't 100% pay for the loan and MF, at least it can slow the bleeding and buy you time. . There are other options than simply defaulting.

Sent from my iPhone using Tapatalk

Sicnarf · Apr 25, 2015

I believe what you wanted to do is deed in lieu of foreclosure. Basically you are agreeing for the TS company to take it back without going through the foreclosure process.

Passepartout · Apr 25, 2015

Sicnarf said:
I believe what you wanted to do is deed in lieu of foreclosure.

Problem is that the OP doesn't have the deed. Whoever the purchase was financed through holds that. Presumably that entity (and it may well be an arm of the developer) paid for the week and set up a schedule of payments. In order to get a deed to turn in for 'deedback', he'd need to satisfy that loan or get them to forgive the debt. Unlikely at best.

Anybody have questions about why one should never finance a purchase with little to no underlying value?

If one has debt and payments far in excess of the value and their ability to make the payments, there is a remedy. It's called bankruptcy. Most debt can't be forgiven any more, but some items with value and be liquidated and a schedule of payments, through a court, can be set up that will satisfy the loans.

Jim

Saintsfanfl · Apr 25, 2015

Passepartout said:
....Most debt can't be forgiven any more, but some items with value and be liquidated and a schedule of payments, through a court, can be set up that will satisfy the loans.

Jim

What do you mean by this? I thought very few debts, like student loans, were the only ones not forgiven in a Chapter 7 bankruptcy. I didn't think there were any payment plans done. A Chapter 11 reorg bankruptcy would be how you describe. For someone far upside down with little hope for repayment chapter 7 is the only way to go. Chapter 11 is for big companies and a small handful of individuals (individuals who would likely prefer ch. 7 but creditors protest).

I could be wrong and maybe something has changed recently.

Passepartout · Apr 25, 2015

Saintsfanfl said:
What do you mean by this? I thought very few debts, like student loans, were the only ones not forgiven in a Chapter 7 bankruptcy. I didn't think there were any payment plans done. A Chapter 11 reorg bankruptcy would be how you describe. For someone far upside down with little hope for repayment chapter 7 is the only way to go. Chapter 11 is for big companies and a small handful of individuals (individuals who would likely prefer ch. 7 but creditors protest).

I could be wrong and maybe something has changed recently.

Yes, Chapter 11 is for corporate restructuring, but the 'simple Chapter 7, and the Chapter 13 for individuals with more complex debt and income situations is more prevalent.

No one here- even an experienced BK attorney could- or would make a recommendation on what is appropriate for the OP or anyone else without the debtor filling out a fairly extensive questionnaire about their financial situation.

Bankruptcy rules changed markedly in the first few years of the 21st century.

Debt forgiveness is not nearly as sure a thing as it once was.

EDITED TO ADD: The Bankruptcy code is meant to give a second chance to people who, through no fault of their own, become insolvent. Loss of a job through disability, death of the family breadwinner, divorce, uninsured medical bills, are the biggest reasons for bankruptcy. If someone simply overpays for a vacation timeshare property, and CHOOSES not to pay the debt, able, or not, I think that any BK court judge would counsel the debtor that THAT's what second jobs are for. Get one and pay your consumer debt.

cm_mc · Apr 27, 2015

No, I haven't attempted any of the options of mentioning to them that I no longer plan on paying them any f my money. That's why I'm here asking for advice. I had also thought that a foreclosure only lasts for about 4 years, not 7. And as I mentioned earlier, I "got all my ducks in a row" before refusing to pay them; as of right now, my credit is near perfect and I applied for several credit cards with a large amount of credit on them IN CASE i needed them for emergencies down the road with a very fair interest percentage. I also don't plan using my credit for that matter an any large purchases for the next seven years anyway - house, car, etc. I also just finished moving into my new apartment, which I would not otherwise be able to afford if i still continued to make the regular monthly payments to the TS company.

Jason245 · Apr 27, 2015

cm_mc said:
No, I haven't attempted any of the options of mentioning to them that I no longer plan on paying them any f my money. That's why I'm here asking for advice. I had also thought that a foreclosure only lasts for about 4 years, not 7. And as I mentioned earlier, I "got all my ducks in a row" before refusing to pay them; as of right now, my credit is near perfect and I applied for several credit cards with a large amount of credit on them IN CASE i needed them for emergencies down the road with a very fair interest percentage. I also don't plan using my credit for that matter an any large purchases for the next seven years anyway - house, car, etc. I also just finished moving into my new apartment, which I would not otherwise be able to afford if i still continued to make the regular monthly payments to the TS company.

So Basically:

1. You got a bunch of credit cards (which will have their interest rates reset higher and limits decreased as the default hits your credit report) as a solution to your debt problems. It sounds like you may even be carying limits on those credit cards.

2. You moved into housing that you can not afford.

3. You have a timeshare liability you are not absolved of and haven't even figured out how to become absolved of.

4. you have not even consulted a BK attorney to figure out what "getting your ducks in a row" is (The above is not it FYI).

5. You have just stopped making payments because you feel that the financial liability you willingly signed up for was not one you wanted any more.

Depending on your current situation, the next steps involve the HOA (and if applicable the lender) to sue you for default. Depending on the law(s), they can and will send collectors after you, garnish wages, seize property and ruin your credit.

Good luck.

Free2Roam · Apr 27, 2015

Jason245 said:
1. You got a bunch of credit cards (which will have their interest rates reset higher....... as the default hits your credit report)

Laws changed several years ago that should prevent this.

Jason245 · Apr 27, 2015

FreeIn2010 said:
Laws changed several years ago that should prevent this.

The law as I understand it requires notification of interest rate increase in advance and does not prevent.

1. Card issuers from closing credit lines at will (except in certain states where there is notification requirements )

2. Card issuers increasing rates upon notification.

Those credit lines at good rates are gone pretty soon after default judgements.

e.bram · Apr 27, 2015

If you get sued, ask for a jury trial(allowed by the Constitution), use "fraud in the inducement" as a defense and counter-claim.

Free2Roam · Apr 27, 2015

My understanding is... Yes, they can - and probably will - lower credit limits (even if you're not in default.) They can also close accounts and/or increase rates with notification (I believe if the account is at least a year old.) But universal default has changed and they're not supposed to arbitrarily raise your rates if you default on other obligations. If they do increase your rate, it shouldn't increase for existing balances... unless you're delinquent on that particular account.

FYI - I'm not a credit 'expert'... just sharing my understanding.

Passepartout · Apr 27, 2015

cm_mc said:
No, I haven't attempted any of the options of mentioning to them that I no longer plan on paying them any f my money. That's why I'm here asking for advice. I had also thought that a foreclosure only lasts for about 4 years, not 7. And as I mentioned earlier, I "got all my ducks in a row" before refusing to pay them; as of right now, my credit is near perfect and I applied for several credit cards with a large amount of credit on them IN CASE i needed them for emergencies down the road with a very fair interest percentage. I also don't plan using my credit for that matter an any large purchases for the next seven years anyway - house, car, etc. I also just finished moving into my new apartment, which I would not otherwise be able to afford if i still continued to make the regular monthly payments to the TS company.

See bold above. My advice is to cut up the 'extra' credit cards. You need less rather than more. Then get a second job with which to pay down the debt you already have. Move to an apartment you can afford. Live frugally, yes, ramen noodles and all that, for 2 years and you can live honorably, with good credit, and vow to never get in this situation again.

And stay the [bleep] away from timeshare presentations that promise you a quick few hundred bucks for 2 hours of your time.

There ain't no free lunch.

And THAT's my advice. (which I doubt you'll take)

Jim

bogey21 · Apr 27, 2015

Passepartout said:
My advice is to cut up the 'extra' credit cards. You need less rather than more. Then get a second job with which to pay down the debt you already have. Move to an apartment you can afford. Live frugally, yes, ramen noodles and all that, for 2 years and you can live honorably, with good credit, and vow to never get in this situation again.

I'm on board with this advice. But if OP is intent on Armageddon, he is as well positioned as he can be.

George

Jason245 · Apr 27, 2015

Passepartout said:
See bold above. My advice is to cut up the 'extra' credit cards. You need less rather than more. Then get a second job with which to pay down the debt you already have. Move to an apartment you can afford. Live frugally, yes, ramen noodles and all that, for 2 years and you can live honorably, with good credit, and vow to never get in this situation again.

And stay the [bleep] away from timeshare presentations that promise you a quick few hundred bucks for 2 hours of your time.

There ain't no free lunch.

And THAT's my advice. (which I doubt you'll take)

Jim

Summary of above

"Pay your bills Deadbeat"

Passepartout · Apr 27, 2015

Jason245 said:
"Pay your bills Deadbeat"

That isn't exactly correct- though I can see how one could say that. It's that the OP seems to have made the choice to make the commitment to take on the debt, and now seems to be purposely positioning himself to duck that responsibility.

It isn't easy to deal with the daily calls from creditors, the late notices, the lawsuits, the letters from law firms, the possible garnishments, the loss of employment because their employer chooses not to have their payroll people withholding garnishments, then the ultimate foreclosure and credit hit and it's attendant increases in insurance cost and difficulty in securing suitable employment. Living in the 'gray' or cash economy, unloading trucks or doing landscaping as a day laborer is no picnic.

I won't call names, but these things seem to be what the OP is 'getting his ducks in a row' to prepare for.

I wish him good luck. The easy way out is to pay down the timeshare debt. Get current, then negotiate with the developer and holder of the debt for a deedback.

Jim

csxjohn · Apr 27, 2015

cm_mc said:
Going a few months back (http://tugbbs.com/forums/showthread.php?t=180600&page=2) I asked on any advice on how to get rid of my timeshare, or at least stop making the payments on it. After getting all my ducks in a row, I am ready to take the hit of a possible foreclosure and a giant credit score hit, worst-case-scenario. But I thought I'd make one last stop here before it actually happens. I was given the advice [see link] to ask for a deed in lieu of foreclosure, even though that is extremely unlikely to happen, and was told to do it in writing.

Is it ok to have the same communication via email, as to have a "paper trail" proof, should they decide to go through with the deedback and decide later on to come after me for what I owe them? I would find it very time consuming to do it via snail mail. Or does it have to be through letters for legal reasons? Any advice is welcome TIA!

Email will work just fine for your purposes, just keep everything. If your developer realizes that they are not going to get any more money from you they may take the deed back but will keep what you have already paid. It has been written about on these pages where this exact same thing has happened even though money is still owed on the original purchase.

A lot will depend on who holds the original note.

I seriously doubt you will be relegated to a life of working for cash for the rest of your life over a timeshare foreclosure.

It may not be the doom and gloom that others have posted here. We have had a loan officer come on these pages and tell us that he didn't consider timeshare defaults when giving out loans. Many people realize how people are bamboozled into buying these things and how hard it is to give them back.

Do what you have to do but please don't let the name calling run you off. We all want to know how this works out for you, however it ends up.

Many come here with the same problem but we seldom get follow up reports.

Jason245 · Apr 27, 2015

csxjohn said:
Email will work just fine for your purposes, just keep everything. If your developer realizes that they are not going to get any more money from you they may take the deed back but will keep what you have already paid. It has been written about on these pages where this exact same thing has happened even though money is still owed on the original purchase.

A lot will depend on who holds the original note.

I seriously doubt you will be relegated to a life of working for cash for the rest of your life over a timeshare foreclosure.

It may not be the doom and gloom that others have posted here. We have had a loan officer come on these pages and tell us that he didn't consider timeshare defaults when giving out loans. Many people realize how people are bamboozled into buying these things and how hard it is to give them back.

Do what you have to do but please don't let the name calling run you off. We all want to know how this works out for you, however it ends up.

Many come here with the same problem but we seldom get follow up reports.

OP stated "No, I haven't attempted any of the options of mentioning to them that I no longer plan on paying them any f my money."

Instead of trying to come to an agreement of any type with the resort or the note holder, OP has decided to "get their ducks in a row" by taking out additional debt and deciding to no longer pay (after owning the unit for since 2013 and having initially received advise about what to do over 7 months ago).

If someone takes a gun and purposly shoots themselves in the foot after being told that it is a bad idea and given suggestions that would help, sympathy quickly falls by the way side.

comicbookman · Apr 27, 2015

csxjohn said:
A lot will depend on who holds the original note.

It may not be the doom and gloom that others have posted here. We have had a loan officer come on these pages and tell us that he didn't consider timeshare defaults when giving out loans. Many people realize how people are bamboozled into buying these things and how hard it is to give them back.

A loan officer might ignore a timeshare loan default, but a credit rating agency probably will not ignore a default or foreclosure. If your credit rating takes a hit, then the credit card companies are allowed to use that change to lower your limit and/or raise your rate, as long as they give proper notice. Companies that give very low rates, usually check on your credit periodically.

Advice on how to eliminate my timeshare

cm_mc

DeniseM

Passepartout

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Saintsfanfl

theo

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cm_mc

TUGBrian

uscav8r

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Sicnarf

Passepartout

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Saintsfanfl

Passepartout

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cm_mc

Jason245

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Free2Roam

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e.bram

Free2Roam

Passepartout

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bogey21

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Passepartout

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Jason245

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