A timeshare contract is a legal agreement that allows you to purchase ownership of a property, typically a resort or hotel. You pay a one-time fee for the purchase, and you’re responsible for paying annual maintenance fees (usually charged to cover the costs of running the property) as well as taxes and utilities. These are all expenses you’ll be responsible for whether or not you use your timeshare during its designated year, so it’s crucial to know what’s in your contract before signing it.
Types of Timeshare Contracts and Ownership
There are two main types of timeshare contracts: non-deeded and deeded. Both types allow you to own a piece of property, but they have different implications.
The most common type of timeshare contract is a deeded one, which essentially grants you ownership of the property. It’s often a better option than buying outright because it’s typically less expensive.
Timeshares can be a great way to enjoy a vacation spot without having to worry about the costs. However, it’s also important to know how long your contract will last and what your obligations are to the property you buy.
Rescission Policy and Timeshare Contracts
If you’ve recently purchased a timeshare and aren’t happy with it, it may be possible to get out of your contract. Most states have rescission laws that let you back out of your timeshare within a specified period of time.
The most common rescind policy for timeshare contracts is a period of ten days, though you may have a longer time frame. Many states even require that these cancellation notices be sent to a specific address.
There are also several laws in place that protect consumers when it comes to timeshare contracts and the information they must provide. This includes the EC Directive on timeshares, which is designed to ensure that consumers get the full disclosure about a product or service before entering into any kind of contract.
Article 8 of the Directive requires timeshare trader to provide all relevant pre-contractual information in a form that is easy to understand and can be understood by an EEA consumer. If this is not provided, a consumer can cancel the agreement and obtain compensation for the time and money they have lost.
Another provision of the Directive is that a timeshare trader must offer a 14 day cooling off period to all customers and must not charge any cancellation fees. This is a welcome addition to the EU law, as it provides peace of mind for consumers and ensures that timeshare traders aren’t abusing the law.
The EC Directive has made it a criminal offence to fail to provide the required information or to sell a timeshare with incorrect information. This includes not providing a certified translation of the contract or information document if the purchaser is an EEA national or resident.
A timeshare trader must also provide a refund of the reservation deposit if the prospective buyer withdraws from the interest reservation for any reason.