How to Be Safe When Buying a Timeshare

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How to Buy a Timeshare

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If you are one of those people who always vacations in the same area, you may want to consider buying a timeshare. It must be better than continually searching for a hotel at a decent price in the same area. But what exactly is a timeshare and how does it work to buy one?

What is a Timeshare?

A timeshare is basically a type of ownership you can have of a property that is shared with others. At a designated time, you can use the property or rent it out to other people. Typically you can use the property for a week or two at a time. You only need to physically  maintain the property for the time that you are there because the other owners are responsible for it when you are not there. All owners do need to pay maintenance fees, though. There also is a moderately priced down payment at the start of your ownership. A timeshare becomes a good deal after only a couple vacations, however, when compared to typical hotel prices.

There are also exchange programs set up in most timeshare companies. This allows you to swap locations and times with other owners in order to have some variation to your vacations despite being a partial owner of a vacation property.

You can also rent out your property time to other people and attempt to make some money while you skip a vacation.

Why you should be careful when buying a timeshare

Timeshares are notorious for being used in scams. The whole concept of a timeshare is a bit dangerous to begin with. While it is almost always a good alternative to renting hotels at the same spot for a vacation every year, they can become an expensive mistake that is hard to get rid of. Here are some reasons why timeshares can be dangerous.
  • Maintenance fees tend to increase by a few percentage points each year. This can slowly make the timeshare more and more expensive to own
  • There are usually restrictions for resale's. The timeshare developers often have contracts that stipulate that they receive a commission if you sell your portion of the property. They can also flat out refuse a sale for whatever reason.
  • Timeshares do not hold their value well. Unlike typical houses, value rarely appreciates for timeshares. They are essentially vacation houses that get more and more beaten up and expensive to maintain as time goes on.
  • Scams are everywhere. Due to the fact that many people have timeshares and are trying to get rid of them, underhanded and deceptive sales tactics are quite common
  • Some scams start before you even buy the property. You often are offered a prize pack for attending a timeshare presentation. The prize is relatively worthless and they'll have you sign up for something tat costs you more money

What you should do to safely buy a timeshare

  • Make sure you actually want one. A timeshare is a cheaper alternative to a very expensive vacation house. Just remember it is a cheap vacation house that you probably can't resell. If you want to vacation in the same spot at around the same time of year for many years, a timeshare is worth it for you.
  • Don't be rushed into signing, buying or paying for anything. With so many scams around, it would be a good idea to read all the paperwork involved in the sale very closely before you agree to anything
  • Check the property's history before agreeing to buy it. You may find out that its maintenance costs are too high or that the property may not even exist!
  • Have your lawyer review all the sales documentation. You never can be too careful and ti is good to know what a contract regarding a shared property truly entails
  • Be the second owner if you can. Since timeshares lose value so fast, you may be able to get one at a cheap price from someone whom decided that owning a timeshare wasn't for them. The resale alone should be a pretty big discount
Basically, in order to buy a timeshare you need to take the time to think about what type on investment it really is and then put the property and the sellers trough an extensive screening process to weed out the scammers. If you figure it all out, then you will come away with something great: a relatively cheap and guaranteed vacation spot at your favorite resort for years to come

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on June 26, 2014 - Moving Expert
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