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Chapter 2: Common Timeshare Scams

Common Timeshare Scams

The most common timeshare scam is simply the timeshare presentation.

As we’ll soon discuss, timeshare presentations are packed with lies, false guarantees and aggressive sales tactics — anything to get a vacationer to make an impulse buy. An impulse buy is purchasing something you hadn’t planned, such as buying a timeshare during a high-stress presentation. Many times, impulse buys are not wise financial decisions.

For instance, according to a survey conducted by The Ascent, 71% of respondents agreed that impulse buying is a waste of money, and 87% made an impulse purchase they regret. The majority of respondents said they threw money away when they felt desire more strongly than logic. Timeshare salespeople are trained to exploit emotions like desire any way they can.

Other timeshare scams often involve resale, which we will discuss in Chapter Three. With that said, the entire timeshare industry is overflowing with scams, and they happen far too often. For example, in 2013, the Federal Trade Commission (FTC) announced 191 actions to stop fraudulent timeshare operations.

In this chapter, we’ll focus on timeshare presentations and how they are brimming with fraud. If you were pressured into buying a timeshare ripoff during a presentation and want to get out, we understand, and we’re here to help at EZ Exit Now.

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The Timeshare Presentation

There are many different timeshare scams and ways con artists deceive owners, but it all starts with the timeshare presentation. Salespeople will do whatever it takes to lure you into the presentation, such as promising gifts or free vacations, and then keep you there until you sign over your financial future.

For example, a sales representative might offer three nights at a high-end resort along with theme park tickets at an unbelievable price. All you have to do in exchange is to attend a “short” presentation. They do not tell you that the presentation may last for several hours and that they’ll use various sales tactics to pressure you throughout. It’s possible you’ll attend a presentation and never even receive the gift they offered. Or, it may turn out that you only receive the reward if you buy a timeshare, even if that’s not what you were initially told.

It is not uncommon for salespeople to lie during the presentation. They may tell you the timeshare is a great investment that will increase in value, or that it will be easy to resell, while none of that is true. Or they’ll talk about the money you’ll save vacationing at the timeshare over the years and fail to mention the maintenance fees.

Overall, here’s a brief list of tall tales you might expect to hear:

  • It’s a good investment: A salesperson will treat the timeshare as if it’s a real estate investment. In reality, a timeshare depreciates the moment you sign.
  • You can make a profit renting it out: This is another lie a representative may tell you. It’s difficult to find someone who will want to rent your timeshare when there are so many on the market, especially if your allotted week is less than ideal. Many owners would rather skip the trouble of trying to find a renter and let the timeshare go unused.
  • It’s easy to resell: Timeshares are challenging to sell, and chances are very high that you will get less — often much less — than what you paid. No matter what a salesperson says, no one will want to pay more than what you paid for your timeshare.
  • You’ll be able to trade your timeshare to stay anywhere in the world: If a salesperson is trying to persuade you to buy a points-based timeshare, they may tell you it’s effortless to vacation wherever you want. The truth is, it’s not easy to book a timeshare anywhere in the world because you’ll be competing with other timeshare owners who may have booked your desired unit years in advance.

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Although the majority of individuals go to presentations just for the free gift, salespeople are so skilled they can trick people from all backgrounds into buying timeshares. They’ll target anyone — elderly couples, young newlyweds, doctors, journalists — the list goes on, and no one is immune to their methods. They’ll pretend that you must buy the timeshare before you leave, argue with your every objection, and try to make you feel guilty for accepting their free gift without buying.

One former timeshare salesman, Rick J. Pons, actually wrote a book about his experience titled, “Lying for a Living.” In the book, Pons discusses how he felt overwhelmed by a fear of rejection and used tactics with names like “Humiliation” and “Pity.” He admits some timeshare salespeople will lie almost about anything if it means they’ll make a sale. He also agrees that timeshares don’t make sense for most people who buy them.

What drives timeshare salespeople to lie to potential buyers and use intimidation and manipulation to sell? It might help to know how the timeshare process works. Consider an analysis published in the Journal of Retail and Leisure Property. According to the article, marketing and sales begins during the construction phase of a new timeshare property and continues after completion or until all of the timeshares are sold. Imagine — each unit in a resort may need to sell up to 52 timeshares. For a resort with 100 units, that’s 5,200 timeshares that need to be sold within a set amount of time.

Also, marketing costs account for a large portion of the timeshare price. In other words, the hefty price you pay for a timeshare covers the advertising expenses for the developer. It doesn’t seem fair to pay so much for marketing and to help timeshare developers make a big profit.

With a lot of pressure to sell, timeshare representatives aren’t going to care if they seem overly aggressive or make you uncomfortable. After all, it’s you or them, and they’re going to fight for themselves first.

None of this is something you need to deal with, so that’s why it’s recommended to skip the presentation and forgo the free gift. There are other more legitimate, less risky ways to find a vacation deal, and it’s probably not worth subjecting yourself to the stress of a timeshare presentation.

Other Common Timeshare Frauds

Unfortunately, timeshare scams follow buyers long after they leave the salesroom.

Timeshare deeds are often public records, so scammers can easily dig through files to find and target timeshare owners.

Scammers might also obtain owner information from staff at the resort or by other means. They will try to con you however they can, such as falsely claiming they are affiliated with ARDA, even posing as real ARDA staff members, to collect some fee. Here are a few examples of recent scams reported by ARDA and its Resort Owners’ Coalition (ROC):

  • In 2015, an individual contacted a timeshare owner claiming to represent ARDA and invited them to dinner to educate them about recent changes to industry practices, though the person was in no way affiliated with ARDA.
  • In 2013, an individual contacted a timeshare owner, also claiming to be affiliated with ARDA, and invited the person to a free dinner to discuss recent law changes, though this was a lie.
  • In August 2012, timeshare owners were receiving calls to attend dinner for industry updates by false ARDA representatives and were told they could convert their timeshares for points or purchase a timeshare that was yet to be built.
  • In June 2012, a timeshare owner received a fraudulent letter stating they owed a $900 fee due to an error in maintenance fee billings.

With the risk involved and the inherent lack of value, it’s fair to say that timeshares are a ripoff.

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