Borrowers who ask this question are typically those who are struggling to manage their annual maintenance fees, due to an increase in fees or other hardships that have caused the payment to become unaffordable. During this time of financial crisis many people cannot afford to pay on a vacation home.
However, do not be under the false impression that there will be no consequences if you allow the payments to lapse. This is far from the truth. Just like if you stopped making payments on your mortgage or credit card, the timeshare company may send the debt to collections and report this action to the credit bureaus. This means you may be pursued by a collection agency for the delinquent payments, and/or may face additional fees and penalties for the amount due.
Some people believe that just because they no longer use the property, that the timeshare owners will just take back ownership without any consequences. This is not how it works. If anyone was allowed to just walk away from their responsibilities there would be an abundance of vacant properties, especially during this least desirable times of the year to vacation. Therefore, no timeshare company is going to let you off the contract free and clear of your obligations. Even if you never intent on using the property again, you will still be responsible for the maintenance fee.
You can try deeding the property back to the Timeshare company. This can be done by contacting the firm and informing them that you can no longer afford the property and you would like to work out something by signing it back over to them. Often, it will take some type of cash settlement but it is possible to do this. Then you can walk away without a care….
You can also try renting your alloteed time out to the highest bidders on websites like Craigslist.
Instead of just stopping payments and walking away from your obligations, you may want to try and sell the property.
Sometimes it even makes sense to simply give it away. Maybe a charity can take it off your hands for a tax deductible write off?Unfortunately, for some sellers, you might be holding onto a timeshare that isn’t particularly popular, or maybe your week isn’t in high demand. In this situation, it might even make sense for you to offer a financial enticement. For example, you might offer to pay this year’s maintenance fees, but allow the new owner to use the week.
Conducting your sale in this way wouldn’t save you this year’s expenses, but it would ultimately allow you to relinquish the responsibility to someone else. This is far preferable to having your timeshare foreclosed upon.
Just be cautious that when you sell your timeshare you are not being ripped off. You should not pay a salesperson an upfront fee to sell your timeshare for you. A professional real estate person collects commission only after the sale is finalized, not before.