Picture a timeshare in the Caribbean. A pristine beach with white sand, sunny skies as far as the eye can see… and hard-sell tactics and bad decisions about how to spend your money.
Timeshares are a way for you to co-own a property that you use for vacations. The idea sounds great. You can only be on vacation part of the year, so why be the sole owner of a property you can’t even use much of the time?
And it might be great. Or it might not be. Timeshare marketers often use high-pressure methods to persuade you to buy. And then, not infrequently, you’ll find out that what you signed up for is not what you thought.
How the Scammers Get You
The typical method of selling timeshares is to invite you to a presentation to listen to the sales pitch. In some cases, you’ll be offered an added bonus. If you attend, you’re told, you’ll receive a prize, such as dinner in a restaurant, a stay in a hotel, or an inexpensive travel package.
The presentation, though, can be more a nightmare than a dream. You’ll be attacked with relentless pressure to buy, and then you’ll find out that to receive the bonus, you’ll have to actually go ahead and make the timeshare purchase. Don’t fall for those arm-twisting tactics.
So what should you do? How can you protect yourself? One way is to arm yourself with information. Here are some things that typically happen at timeshare presentations:
- You’ll be told that you must buy now to get the deal the company is offering. But in fact, you may be able to get the same deal tomorrow or the day after that.
- You’ll be told that if you buy now, you’ll receive a discount. But if they first raise the price by 20 percent and then offer you a 20 percent discount, what are you gaining?
- You’ll be told that it’s a good investment to buy a timeshare. But it’s a lousy investment. The value of most timeshares decreases by 20-30 percent once you buy them, partly because the company selling them has enormous marketing costs — even up to 50 percent of the price you pay.
- You’ll be told that you can always sell or rent out your timeshare. But in fact, timeshares are hard to resell and hard to rent. You will likely lose money, perhaps a lot of money.
Here are some more tips to avoid becoming the next victim of a timeshare scam:
- Don’t let your enthusiasm and vacation fantasies take over your emotions. Remain rational and a bit skeptical and take however long you need to come to the decision that is right for you, not for the guy with the hard-sell tactics.
- Research the company and find out what others say. Is it a scam, or is it for real? Find out where the company is located and then seek information about it from consumer protection agencies.
- Look carefully at any contract you are offered, and never sign a contract until you’ve consulted with a lawyer.
- Don’t give in to pressure. If you are told that in order to receive a certain benefit you must sign up immediately, remind yourself that decisions made under pressure often do not turn out well. If the offer is legit, why is it so urgent?
Can a timeshare be a good purchase? Yes, in some cases, but only if you know exactly what you’re getting and what you’re not getting and have made a rational and informed decision to go ahead with the purchase.