LITTLE ROCK - Today, Attorney General Dustin McDaniel issued this consumer alert to warn timeshare owners about property resellers and reselling scams.
The term "timeshare" is used to describe a type of property in which an owner buys the right to use it for a designated period of time. Timeshares are most often condominium units, and there are usually several different "owners." Many people bought timeshares in the 1970s and 80s as a result of mass marketing and in some cases high-pressure sales tactics. Because they are a type of real estate, some consumers bought them as investments, assuming the value of the property would remain steady or even rise with the passage of time and the popularity of the property's location. Unfortunately, consumers didn't realize that the marketing costs were significant and included in the original price, making it difficult for a timeshare to retain its value. Also, in many areas, timeshare projects were overdeveloped, resulting in a glut of properties which has depressed values and made resale difficult.
Now, facing increasing assessment and maintenance fees, many timeshare owners are desperate to sell. Unfortunately, a number of operations have sprung up to take advantage of the desperation of these owners. They offer assistance with selling the timeshare and relief from the burden of the continuing costs of ownership. But, in many cases, these promises are false.
Owners of timeshare properties should heed the following tips about reselling and resellers:
• Beware of timeshare resellers who contact you unsolicited with a promise to help you resell your timeshare.
• If they say they have willing buyers, it is probably a lie.
• Never pay a substantial advance fee for resale assistance. A reputable reseller will charge a commission paid only upon sale, just like a normal real estate transaction. An advance fee may be called a "marketing fee," a "listing fee," an "Internet advertising fee," or something else. No matter what it is called, don't pay it in advance.
• Get an independent appraisal from a licensed appraiser before agreeing to any resale assistance contract.
• Deal only with licensed agents. Check with the Arkansas Real Estate Commission at 501-683-8010; the Better Business Bureau at
www.bbb.org; and the Public Protection Department of the Attorney General's Office at 501- 682-2341 or toll-free at 800-482-8982 before entering into a contract for resale or if you have general questions.
