When buying a timeshare, there are two ways to choose a resort. You can either choose a fixed timeshare where you visit the same resort each year or a points system where you choose your preferred resort each year. They offer you luxury accommodations with excellent amenities. Timeshares come at a cost. You must be ready to incur high purchase costs and yearly maintenance fees. When the charges are deducted from the bank account, most timeshare purchasers begin to look for ways to exit immediately. You require a timeshare cancellation letter to exit from a timeshare purchase.
Table of Contents
- 1 Timeshare Cancellation Letters
- 2 What is timeshare cancellation?
- 3 Timeshare Cancellation Letter Templates
- 4 How does timeshare work?
- 5 Types of timeshares
- 6 Timeshare Rescission Letters
- 7 How much would you pay to own a timeshare property?
- 8 How to cancel a timeshare?
- 9 Timeshare Cancellation Letter Samples
- 10 How to terminate a timeshare contract?
- 11 How to write a timeshare cancellation letter?
The cost associated with timeshare purchase is what drives most buyers to want to exit the soonest. The purchase cost of a timeshare is high and purchasers are charged an annual maintenance fee. If they want to sell, timeshare depreciation can be sudden and the margin is most significant.
Timeshare cancellation means exiting a timeshare purchase without having to suffer a penalty. It is the cancellation process that ensures the purchaser receives their full refund. Although it is possible to cancel a timeshare and receive a full refund, it almost doesn’t happen without challenges. The purchaser must cancel their timeshare within a certain time. That means the purchaser must take action immediately.
Timeshare purchasers have two options.
- Right to use contract
Right to use contract is also called a shared lease. To lease means multiple people buy the same property. Everyone who purchases shares the same property with other people. Purchasers get the right to use the property for a certain period of the year and a certain number of years. The disadvantage with this type of timeshare is that you cannot rent or sell it.
It does not give the purchaser any ownership rights, nor does it give any interest. The only option to rid yourself of this timeshare purchase is to cancel it. The purchaser may want to search for a timeshare cancellation letter sample before they prepare a timeshare cancellation letter to ensure they didn’t miss any detail.
- Shared deeded contract
In this type of timeshare purchase, all the people who purchase have equal ownership of the property. It is divided between the purchaser and everyone else who buys the timeshare. The owners are assigned a set of specific weeks in which they can use the property. The advantage of this timeshare is that the owner has the right to sell, gift it to someone, or bequeath it. If they want to cancel, they can write a timeshare cancellation letter within the allowed timeline.
From the mid-1970s, the number of condos in the US significantly increased. Due to competition, owners began looking for ways to offload them. This is when the idea of timeshares began. Since then, the industry has evolved with multiple products. Here are the main types of timeshares.
- Point system timeshare
Point system timeshare is the oldest type of timeshare. It started in the 1970s and has kept evolving. This timeshare offers owners a specific number of points every year. The points are redeemable by choosing stays at specific properties every year. To redeem your points, there are several factors you have to look at.
- Your resort choice
- Room size
- Dates of stay
Whichever factor is attracting more demand, it will cost you more timeshare points. During your initial purchase, you have to purchase a specific number of points upfront. It all depends on how your plan for the year is and the way you want to use your timeshare in that year. Depending on the timeshare company you use during purchase, your price will be charged per point.
Sometimes the total price goes beyond what most people can afford and this is where the need to cancel a timeshare comes in. The timeshare owner needs to get a timeshare cancellation letter template and fill it in within the time when the cancellation window is still open.
- Fixed week timeshare
The first time when timeshares were sold, the only existing type was the fixed week timeshare. The purchaser is limited to the benefits they get.
- Timeshare owners have to use the property within a specific week during the year.
- They have to choose a specific property.
- Sometimes they have to choose a specific room
This timeshare is a good choice for people who love routine. The owner competes with other owners for their choice of date or location. Some owners may find this type of sharing invoicing and may desire to cancel it after purchase. Their best option is to fill out a timeshare cancellation letter template and request for cancellation.
- Floating week timeshare
Floating week timeshare is a newer type of timeshare which gives owners flexible options. Owners can use the property in a certain season or at any season of the year. The disadvantage of this timeshare is competition. It might be impossible to book the desired week due to the number of bookings requested. Owners have an option to cancel it by writing a timeshare rescission letter within the specified time.
There are a lot of factors to consider when you desire to buy a timeshare. The cost depends on several factors too.
- Who you buy from: You can either buy from the property owner or an agent. If you buy from the owner, you might pay less. An agent will have to charge an agent’s fee. Some owners allow purchase from brokers only.
- Type of property: The type of property is measured by the luxury it offers. The more luxurious it is, the more it will cost you.
- Location of property: Properties located in high-end places will cost more. For example, if the property is on a private island, expect to pay the highest. If it is along a beach, its cost will be high, and so on. There are other factors to consider when buying timeshares.
Buying from someone
Buying from someone is also called a resale purchase. Someone might have purchased a timeshare but then felt they want to exit. If the type of timeshare they bought gives them the right to sell. They can write a timeshare rescission letter and offer it for sale. Since the owner wants to get rid of it the soonest, the resale price can be fixed at anything below the original purchase price.
Some people sell them as low as $1. However, the buyer needs to be careful. Recently, there has been a rise in timeshare scams which means the purchaser can easily lose their money. The first thing is to check if the reseller is genuine. Next, you must find out what restrictions goes with that type of timeshare. Some timeshares do not allow resale or transfer. The person who buys a resale timeshare sometimes does not enjoy equal benefits with direct purchases.
Direct purchase means you are not buying from a reseller. When buying directly, the cost for a one-week timeshare is about $22,180. This is the 2022 figure according to ARDA. Above this cost, there is a maintenance fee of about $1,000 per annum.
Some purchasers realize the cost is too high once the amount is deducted from their account. If you feel you want to cancel your timeshare after purchase, write a timeshare rescission letter immediately. It might help to read a timeshare cancellation letter sample to give you an idea of how to write your cancellation letter.
Although some timeshares do not allow resale or gifting someone, all timeshares give the purchaser the right to cancel. If you change your mind after purchase, you will be required to write a letter called a timeshare rescission letter.
The time within which you must write the letter varies with each state. Regardless, most timeshares are given a cancellation window of between 3 to 10 days from the time of purchase. The timeshare rescission letter must be mailed to the property owner or their agent.
Most of the owners require you to send certified mail and to include a return receipt. If the timeshare company has a lawsuit filed against it, you cannot cancel your timeshare until the lawsuit is over.
It is necessary to check before purchase if the timeshare company has any legal issues. If they have legal issues, search for another timeshare company. If you already purchased it only to realize it later, your best option will be to seek legal advice. The company may have lawsuits if:
- It defrauds timeshare owners
- It is going through a financial crisis
- If it misleads potential timeshare buyers or current owners
- If the property owners have shareholding problems
If a time comes and you feel you want to cancel your timeshare contract, you will have several options to look out for. The type of timeshare contract you entered into will be a great determinant.
- Rent out your timeshare
Technically, renting out your timeshare doesn’t mean you have gotten rid of it entirely. You will remain the owner because the agents have your details as the owner. However, you have an advantage because you offset the burden of the expenses by letting someone else offset them for you.
What you need to do is to write to the resort company through which you bought your timeshare. You may also approach a third party to rent it out on your behalf. Some developers may have rental restrictions, but if they allow, you will likely incur rental fees.
- Write to the timeshare company
Your next option is to write to the timeshare resort company to get you out. You can either send a letter through the postal service or by email. The company may try to lure you to stay by offering you an alternative option. They may request you to move to lower points timeshare or to bank your points for future use. Regardless, you have the following exit options.
- Sell your timeshares: Ask the timeshare company to sell your shares. If they succeed, there will be a selling fee and probably a transfer fee.
- Canceling your ownership: You may also decide to cancel your ownership by filling out a timeshare cancellation letter template. This must be done within the allowed time. Some timeshare companies give a window of up to 60 days.
- Transfer:You might not want to sell or cancel your timeshare. You have the option to transfer them to someone. They could be your family member, relative, or friend. The person you transfer to will pay a transfer fee. They must be willing to pay the annual fees.
- Not paying maintenance fees: Another way to terminate your timeshare is to continually use the property for at least three years without paying the maintenance fee.
- Pay someone to help you terminate your timeshare: If all the other options fail to work, your final option will be to pay someone to get you out. This option can be costly due to the fees involved. You need to be careful before you choose a company that helps timeshare owners terminate ownership.
Your first step is to get a timeshare cancellation letter template. Once you have the template, follow these steps.
- Write your names
- Your contact information
- Indicate the name of your timeshare resort company
- Write your contract number
- Write the name of the timeshare contract
- Indicate the date you purchased the timeshare
- Write your reasons for cancellation: At this point, give the timeshare company your reasons why you want to cancel. It is better not to make the reason lengthy but brief. You might only need a few lines to explain your reasons.
- Your Price: This is what you paid at the time of purchase
- Request for a refund: Do not forget to ask the timeshare company to refund you the money.
- Sign: Sign the timeshare cancellation letter and send it to the timeshare company.
After sending your timeshare rescission letter, it is important to confirm if the company received the letter. If they fail to receive it within the allowed time, it will not be possible to cancel. You may want to refer to a timeshare cancellation letter sample before writing. If the cancellation window lapses before sending your letter, your other option is to seek help from an attorney.