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7 tips for avoiding a timeshare disaster

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After decades of reading about -- and writing about -- consumers complaining about timeshares, I never thought I would be gullible enough to buy one. I was wrong. And, if it can happen to a girl with a calculator and an eye for fine print, it can happen to you. But if you’re quick, you can get your money back.

Here’s how timeshare salespeople suck you in -- and how you can get out.

It started with a thick letter announcing that I had won a valuable prize -- most likely a three-night trip to Hawaii for two. But to collect that prize, I first had to listen to a brief “travel presentation.” Three days in a Hawaiian hotel plus two airfares would be worth 90 minutes, I thought. Still, “travel presentation” is code for timeshare, so I went prepared -- guard up, calculator at the ready.

They were ready, too. Addressing all the complaints about timeshares -- that you pay dearly for the ownership interest and get hit with ever-rising annual fees to boot -- the charming salesman said this was less expensive, more flexible. 

Essentially it was a vacation discount program. Club members would pay an average of $499 per week compared with roughly $1,050 ($150 a night) for the average hotel room. The catch: You pay $10,785 upfront and $295 per year. I pulled out my calculator.

At best, I figured I could use two of the promised four weeks each year, and would probably tire of the program within five years. Thus, I divided the initial $10,785 by 10 (two vacations annually for five years), added in the $499 average weekly cost, plus half of the $268 annual fee. That gave me an average vacation cost of $1,711.50 -- way more than the average cost of a week at a hotel. 

I said no. They lowered the price. I said no again, and the price dropped further. Finally, the initial fee was cut to $5,785. 

Tip 1: Even if you really want to buy, never take the first offer.

However, I knew that one of the biggest complaints about timeshares are the annual fees, which you’re obligated to pay each and every year, regardless of whether you book a trip. This fee was relatively small. But consumers have complained that the reasonable fees they started with rose to exorbitant levels within a few years. I asked whether this fee could rise. Yes, it could. I got set to leave.

But they had one more offer to throw my way: What about a two-year “trial membership” for just $1,195? For that I’d get nearly unlimited vacation weeks, they said. The annual fee would be waived for the first year and would be just $124 for the second. And they’d throw in one free week’s vacation for just a $75 booking fee and no long-term commitment. 

Now they got me dreaming. With visions of the luxury digs they’d featured dancing in my head, I began to think about taking five weeks of vacation in the next two years at an average cost of $777.80. It sounded like a bargain. The saleswoman took my credit card and gave me a raft of documents, including one that mentioned “points.”

“Points,” I asked? She brushed off the question. “That is how our vacations are booked. It’s nothing to worry about. You still get everything in the contract.”

Tip 2: Read the contract, it will give you an inkling of what might go wrong

I went home with a binder full of documents, including an inch-thick “disclosure guide” that had further references to points and that all reservations were subject to availability. It sounded like boilerplate until I did a search on the vacation club and found out that it wasn’t. 

Dozens of complaints lodged on sites such as ConsumerAffairs.com, Yelp and the Better Business Bureau claimed that any single vacation week was going to eat up far more points than you could collect in any given year, much less the four vacations promised. By the time you get access to the site to find out that you don’t have enough points to vacation, the company has cashed your check and good luck getting your money back, consumers contended. 

Tip 3: To bring yourself back to earth after a dreamy presentation, plug “complaints” and the name of the timeshare operator into your web browser and see what happens. 

The company I dealt with bragged of its BBB rating, but in reality, that rating came with a whole raft of unresolved gripes.

Fortunately, you can get out of a timeshare if you act fast. State laws provide a “rescission” period for timeshare contracts. You get five to 10 calendar days from signing to change your mind and get your money back. The rescission method is often spelled out in the contract itself. In this case, there was a form to fax or send by mail. I did both, sending the letter by certified mail for the receipt. 

Tip 4: If you buy on a weekend, you need to be particularly quick about rescinding your deal since you’ll want to send the notice by certified mail, which can be done only when the Post Office is open.

Backup plan: If the company failed to rescind the deal, I could dispute the charge with my credit card company. 

Tip 6: Always use a credit card when you’re not certain about a seller, because you have the right to get fraudulent charges reversed.

As for the trip to Hawaii, I got a “voucher” that came with a full page of fine print. To use it, send a $100 deposit, pay $150 in reservation fees, fly on a Tuesday and know the trip is “subject to availability” and more potential fees.

Final tip: When you get a notice that you have “won” a free trip but need to listen to a timeshare presentation to collect it, save yourself some time and effort and just throw the letter away.