In facing the grief of losing a parent, it's obvious that ridding yourself of an unwanted, inherited timeshare property will be one of the last things that crosses your mind as the beneficiary. It's vital to address these unwanted inheritance "gifts" before your parents' death so that you don't have to deal with this problem in county probate court or with the timeshare resort developer directly. Estate planning, including timeshares, should be addressed prior to the owner's death.
There are a few ways to avoid directly inheriting the timeshare from your parents if you don't plan to ever use the timeshare. There are also a few options you might have as an heir to get rid of that timeshare if it's already been passed along to you.
If you're still not too familiar with what exactly a timeshare is (which is perfectly understandable given the nature of the timeshare properties sales industry), a brief explanation is this: a timeshare property is a split-owner, "right to use'' vacation property ownership that is managed and outright owned by a timeshare resort company or a property management company.
It is utilized annually (usually on a per week basis) between owners that buy into the ownership option. These fees are charged monthly in the form of a "mortgage”, but there are additional fees, known as maintenance fees, charged annually to each owner of the unit. These charges may not cover additional costs, which can be charged in the event of a natural disaster or another "unforeseen" event.
As the original timeshare owners, your parents or loved ones should not have anyone else besides themselves on the timeshare title. Oftentimes, the sales representative might attempt to heavily persuade owners to include heirs on timeshare agreements, but it's important for owners to keep in mind how such a quick decision could have long-term consequences for an entire family.
Putting the children's names on the timeshare agreement could essentially force the beneficiaries into ongoing costs upon their parent's death, such as annual maintenance fees, owed interest on the timeshare mortgage loan, and other associated timeshare fees that they likely didn't ask for.
Timeshare owners should also pay from their own bank accounts. As heirs, you shouldn't give the timeshare resort company any of your bank account information, as this could be an additional avenue used to collect payment by the timeshare company.
When trying to get rid of a timeshare property that has already been assigned to a designated heir, the beneficiary might have options when trying to get rid of the timeshare property. As with anything in estate planning and business, it's best to put everything in writing. If the timeshare is of a certain type (usually a "right to use" timeshare) and unwanted by the beneficiary, but it has already been appointed to them, a written letter of renunciation should be sent to the appointed executor of the estate or estate attorney and the timeshare resort company.
This letter should be sent within a certain time frame after the owner's death (dependent on your state's particular laws) in order to fully absolve the beneficiary of any of the responsibilities that come with timeshare ownership. You should consult with an estate attorney in your area for the proper way to handle an unwanted timeshare inheritance.
Although there is no official process for getting rid of timeshares, a living timeshare owner still has some options if they wish to terminate a timeshare agreement prior to their death. If the mortgage and associated timeshare debts are paid off by the owner, then the owner has an opportunity to sell back the timeshare to the resort company or developer. The owner also has an opportunity to sell the timeshare through a third-party site online, but it is important to note that this option is risky, as many of the “resale” companies are scams.
If the owner has leftover debts related to the timeshare, they may work directly with the timeshare developer to settle any of those debts. However, just like the timeshares resale market, owners may discover that more money is required during this process as well. The developer may charge additional fees to terminate the agreement.
Timeshare cancellation companies may be the best option for a person whose timeshare developer is unwilling to work directly with them in terminating the original agreement. These companies typically work directly with you, the timeshare owner, in coordinating a cancellation agreement with the timeshare developer. Some cancellation companies will charge upfront payments without ever giving you any actual results. It's important to do your research if you choose this route, as not all timeshare cancellation companies are the same, nor do they have remotely similar approaches and success rates.
Vacation ownership and timeshare opportunities may be desired by the parents, but it could end up being a huge burden for the children upon their parents' death. Although timeshare agreements can be binding, there are ways to ensure that the timeshare is not passed down to the heirs through proper estate planning and open communication between parents and children. If you feel that your parents are planning to designate you or your siblings as heirs to timeshares, it's best to express your concerns or raise any questions you may have with them prior to their death. Any type of inheritance that causes concerns now will certainly be problematic once you actually deal with it firsthand.
Wesley Financial Group, LLC and/or its affiliates, successors, or assigns are not lawyers and/or a law firm and do not engage in the practice of law or provide legal advice or legal representation. All information, software, services, and comments provided on this site are for informational and self-help purposes only and are not intended to be a substitute for professional advice, legal or otherwise.