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Why are time shares a scam??

ski_sierra

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Timeshares obey Heisenberg uncertainty principle. They are a scam and a good deal at the same time.

Timesharing is not intuitive especially to people who grew up with the internet. I can see how it made sense to sell condos as timeshares when there was no easy way to connect owners with renters. But now we have services like VRBO, booking.com, AirBnB, Craigslist. People are working within the existing system but if someone was looking at the vacation accommodation problem with fresh eyes today, the solution would be very different than a timeshare.

Before I joined TUG couple of months ago, the only thing I had read about timeshares was it is a scam. I still believe it is a scam for a large majority of the people out there. And the people who get scammed subsidize the people who use timeshares to their advantage like TUGgers. The system is not fair and depending on which side you end up on you will feel like it's a scam or it's a great deal. Similarities exist in many places. High expense ratio active funds create a highly efficient stock market that index fund investors take advantage of. High interest paying people subsidize people who take advantage of credit card rewards. Many people pay property taxes but only a few utilize the benefits of libraries, parks, recreation centers, etc.

There are weird and archaic rules in timesharing which are not worth learning for people who don't vacation often. But the complexity means there are opportunities for people who are informed. It's fun to figure out how to be on the winning side. But if you miss a step, you could be on the losing side.
 
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Big Matt

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I would argue that the car buying experience is similar to that of buying a timeshare. Sales people have all of the information and you have little. They sell you on the new shiny thing, but never tell you about maintenance (fees) or taxes. They ask you how much you can afford to pay monthly instead of the amount of interest you will pay.

The sales process is very sleazy. Educated buyers can get great bargains for both used cars and resale timeshares. I for one believe that what I get in terms of value and flexibility with my timeshares far outpaces what I get from renting, hotels, etc.
 

jme

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I for one believe that what I get in terms of value and flexibility with my timeshares far outpaces what I get from renting, hotels, etc.

Same for me, Big Matt, not even close. But admittedly that's our dumb luck, buying at the right time in our lives,

with several additional purchases being resales prior to 2010, and enrolling everything we could. For us both, we were lucky.
 

OldGuy

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This post may get a lot of backlash

But I own timeshares and purchased them with the idea they were not an investment but they gave me a nicer place or places to stay at than a hotel

I read. Read and read some more how horrible they are and people desperately trying to get out and I get that.
There are times I myself would like the same.
But the question is why are they a scam?
I purchased a $80,000 pick up truck and did not go home and immediately get on line looking for a way to get the dealer to take it back. In fact I traded in a 1 year old truck on this one and took a $15,000 loss and never asked the original dealer for a refund or complained that I lost money on it

I did lose but knew that when I bought the first truck and again when I bought the 2nd
Poor decisions. Absolutely!! But they were my decisions.
I will never make $$ on this vehicle as it’s value is dropping faster than the balance owed but it serves a purpose

How are timeshares any different?
Sure. Some sales people either lie or they themselves don’t actually know what they are talking about.
But is it not up to us to make an educated purchase?

I’ve made many poor financial decisions. Timeshare included, but in the end it was my decision and I was never held at gun point

I think part of the regret is that many people. Myself included although I think I’m getting better at it. Do not know how to fully use their timeshare

And I think many people are on a fixed budget and save for a long time or use a credit card to take a vacation and vacations are much different than real life
They see a resort that took them a few years to save for to get to and fall for the lifestyle
Then once they get home they quickly realize that they don’t have the extra $$ to live that life or go on that type of vacation every year

My point is. I don’t think there are really many things in life that make us a profit
Not my groceries. Not my vehicles. Not my insurances or any of my entertainment so why do we. Again myself included feel that timeshares should be any different??

So, the summarize, something you are lied to to get you to buy it, and you pay, say $25,000 for, when people are trying to give the same thing away for free, and then you can't get rid of it, so you have to keep paying additional fees for something you do not use, ad infinitum, is not a bad deal.

OK
 

Gypsy65

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So, the summarize, something you are lied to to get you to buy it, and you pay, say $25,000 for, when people are trying to give the same thing away for free, and then you can't get rid of it, so you have to keep paying additional fees for something you do not use, ad infinitum, is not a bad deal.

OK

Swing and a miss!!

Read the points. Not just mine.
People are taken advantage of all the time. Myself included
But guess what? It’s still up to each person to know good from bad. Lie or not
My post about supply and demand should help

The guy who makes $12 an hour. Has 9 kids. An old beat up mini van and 10x50 trailer is the guy who shouldn’t buy
New or used


There’s no monetary value with timeshares. Never has been. I knew that when I was 16
The value is the vacations if you can afford more than 1 a year. And the ease of it all
The resort purchases make sense if you like the extra perks you might get

We get a lot of perks but we own at a much different level than most do or ever will

It doesn’t work or make sense for everyone
I ride bikes but I don’t get online and complain about how they are a waste of $ and they don’t work at all for me and my 15 kids

Sure. Sales guy never really said it would. But he did sell the freedom factor

And for those who ride they know the value of that

It isn’t that the $30,000 bike that dropped to $15,000 the first year
 
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OldGuy

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Your points are just as valid now as they were 25 years ago. Well, maybe not quite, but I might have made the same ones myself back then.

Have fun on your bike.
 

Fredflintstone

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I must say in the outset I used to own timeshares but now just rent.

Saying that, I don’t see timeshares as a scam. The developer is very detailed on the mountain of forms you sign on the dotted line. If you don’t read them, that’s your fault.

If you buy resale, it is up to you to do your due diligence by researching the prospective timeshare beforehand. Know what you Are buying before you buy it.

I know many folks here who love their timeshares and get wonderful use out of them. The only regrets I hear is they should have bought resale right off the bat.

Yes, I know some salespeople lie. That’s why you MUST read everything before you sign and anything promised that was not added needs to be added in your written documents.

Remember, it’s what you signed that counts.


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Ralph Sir Edward

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They are and they aren't. The underlying concept is good, if you limited it to the target population (which is a very small portion of the total population) and had a sales methodology that didn't lead to inappropriate selling.

Unfortunately, the massive up-front profit on the initial sale, leads to the abuses seen. This is compounded by the owner restrictions many timeshares place on the owners - such as limits on commercial renting.

But as long as there are people who can be convinced to buy timeshares new, the status quo will remain.
 

Brett

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They are and they aren't. The underlying concept is good, if you limited it to the target population (which is a very small portion of the total population) and had a sales methodology that didn't lead to inappropriate selling.

Unfortunately, the massive up-front profit on the initial sale, leads to the abuses seen. This is compounded by the owner restrictions many timeshares place on the owners - such as limits on commercial renting.

But as long as there are people who can be convinced to buy timeshares new, the status quo will remain.


right, especially true with timeshares - Don't buy New !
(become knowledgeable through TUG then buy resales)
 

Gypsy65

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I don’t totally agree with only resales
From the resort is a screw job no doubt but if the additional benefits or perks outweigh the cost then that’s the only way you’re going to get them

Resorts are working pretty hard to make that gap as far apart as possible as they know that’s how they’re going to sell value in their product

At least that’s how I see it playing our with ours
 

Big Matt

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Let me be clear about my experience. I bought my first timeshare at retail price, but I knew exactly what I wanted. I couldn't get a lock off at Manor Club and would have had to wait a few years until they showed up in the secondary market. I paid cash and I believe it was something like $17k. A lot of money 15-20 years ago, but I've got way more value by trading both parts into places like Grande Ocean, Newport Coast, Hawaii.....places that are far more expensive. I also bought a resale lock off at Grande Vista for $7k. That was an even better purchase. You have to look at it over a 25-40 year period to understand the math. I never intend to sell mine either. My kids will get them at some point.

Finally, the most important things that I've received by buying timeshares are: Memories
 

geist1223

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We know 99% of the people say buy only resell. With Developer Points in Worldmark we have direct Booking access to WMSP. In a less than a 10 year period of time (November 2010 to February 2020) we have made will make 4 trips to New Zealand and Australia. Also WMSP has bought into timeshares in Tuscany and Bavaria. And they are looking at Resorts in Japan. With DRI Developer Hawaiian Club besides trips to Hawaii we have traveled to France and Mexico. Yes we know we could try and trade through RCI or II with resell Points. But that is always a chance game that Resorts will become available when and where we want to go.
 

silentg

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Timeshares confuse a lot of people. My father always thought they were a waste of money. My mother bought a week at a timeshare auction, so did my sister.
IMHO they never used the timeshares properly. My Dad liked to trade thru RCI into another timeshare he liked better. My mother liked her timeshare but she traded thru RCI to please my Dad.
He complained about exchange fees, membership and maintenance. But he enjoyed going away I tried to help him understand the concept, but he felt like real estate should have a better resale value, telling him he was buying vacation time never rang true to him. My sister hardly uses her timeshare weeks she prefers to go on cruises and rent hotels. Sometimes she exchanges her week but only stays a couple of days.
We try to make use of all our timeshares. I’ve been doing trades thru TUG mostly and have sold a few weeks on TUG too.
I’m still not an expert Timeshare user but I know how to say no to presentation or free lunch, tell them I have lots of plans and not wasting time listening to a sales pitch.
Of course I try to word it as pleasantly as possible.
I don’t think timeshares are a scam, but I won’t buy from a developer again!
Silentg
 

Bailey#1

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To me my timeshares has been a blessing, but I went into it with some knowledge (always bought resale). That is the difference between a good purchase and a scam.

To me purchasing new snowmobiles has been my biggest mistake (think little snow, insurance, trail passes, back aches, near frostbite, repairs and more repairs, and teenagers living at home) but timeshares has been my best purchase.
 

OldGuy

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Your points are just as valid now as they were 25 years ago. Well, maybe not quite, but I might have made the same ones myself back then.
 

OldGuy

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Using the word scam is like using the word spying. It means different things to different people.

All-in-all, the timeshare industry could be tad more forthright.

:cool:
 

jehb2

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When ever I start singing the praises of timesharing I tell people that they need to beware that there are a lot of scummy people in the industry.
 

Fredflintstone

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When ever I start singing the praises of timesharing I tell people that they need to beware that there are a lot of scummy people in the industry.

I agree but even the scummy people in the industry need to disclose and have you sign that you agree with the terms. That’s the law and it’s consistent in every state. If it’s not in writing and signed off, you can refuse and win. So, that’s why you must do your homework and read before you sign off. Otherwise, it’s your fault if you feel you are scammed.


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Fredflintstone

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Without giving too many details a timeshare resort wanted to add fees and charges that were new. I refused to pay. They said contract. I told them I have a copy of the exact same contract and no where did I agree to these terms and crossed out and initialled that they can change terms at anytime.

They backed down.

I sold that one years ago but it was the contract that helped me, not them that time. It also helped the new owner who was very pleased that I crossed that clause out before signing.


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jehb2

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Every time I go to an owners update they try to get me to upgrade and offer me a special deal of 50:1 HHonors points. Depending on the hotel that exchange might get me 1.5-2 hotel nights for my 7 timeshare nights. Most people don’t realize that. The sales people don’t tell you that. There’s a lot they don’t tell you. In fact they outright lie.

We could start a thread “Lies my timeshare sales person told me.”

I have been timesharing since 1999. I absolutely love timesharing. My family and I have had nothing but great experiences. But timeshare sales people lie. In my last several updates I have actually told them point blank that something they said is not true.
 
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Fredflintstone

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Owners of The Manhattan Club in NYC were scammed.

There are always isolated cases where a resort goes bad. This true in every industry.

As I recall, there was a criminal investigation of wrongdoings there.

I know of one other resort who was alleged to do similar and the CEO got 30 years plus all assets taken and distributed to owners so there are consequences for those who scam in the industry.

Overall, good names are in the industry like Hilton and Disney and Marriott.


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