FAIRBANKS — Timeshares became popular in the 1970s and, at the time, were mostly converted condos. By the 1980s, developers began constructing purpose-built, timeshare properties. Typically, these properties are condos with divided ownership — usually 52 shares representing one week a year. Eventually, exchange programs were introduced allowing owners to stay in accommodations outside their networks, making their assets more valuable.
Alaskans traveling Outside are often enticed into these high-pressure time-share presentations while vacationing in popular destinations, such as Hawaii, Las Vegas and Mexico. They are often lured with promises of free or highly discounted rates for rooms, concerts or vacation activities for attending the seminar.
The demographic of consumers who originally bought timeshares is now over age of 50, but newer vacation options have enticed younger generations such as millennials and reinvigorated baby boomers.
These days, vacation rental sites, such as Airbnb, Homeway and VRBO, are mainstream.
Many timeshare owners would like to sell to eliminate the continuing annual maintenance costs and to recoup their initial investments. Many of these owners are hesitant to leave the timeshares to their children, who aren’t interested in carrying the financial burdens. But buyers can be hard to find and options are limited. Timeshare companies are not interested in buying back units and resale can be difficult. Timeshare values declined after the 2007 recession, and the resale market has since been flooded.
Enter the scammers!
Better Business Bureau’s ScamTracker has logged 377 reports related to timeshares
(bbb.org/scamtracker/us). Many of these scams involved phone calls from purported representatives of buyers using deceptive sales tactics. These fraudulent companies even send authentic-looking sales agreements and escrow papers to be signed.
The “agent” will then ask for fees to be paid upfront, promising these will be refunded at closing. These fees include “temporary naturalization papers” for timeshares in Mexico, sales taxes, transfer and recording fees. Official names are used for the companies, banks, title and escrow companies. But, in the end, victims are out thousands of dollars in these fraudulent schemes.
One person reported to BBB’s Scamtracker: “I realized this is very much a scam so I refused to send further money. However, they have been calling daily to convince me to send the requested money …they are very aggressive and threatened either we pay this money or serious consequences may apply.”
It is easy for scammers to find timeshare owners by mining public records. Here are tips if you are a timeshare owner and receive an unsolicited phone call:
• It’s best not to agree to anything over the telephone, especially if you did not initiate the call.
• Don’t be pressured to make an immediate decision.
• Do vigorous research if you are approached: Where is the company located? Is there a legitimate office with licensed real estate agents where your timeshare is located?
• Read reviews about the company online.
• Ask for written materials.
• Find out whether commissions are charged. Be wary of any upfront fees you may be asked to pay or if asked to send the money by wire transfer.
• Contact local consumer protection agencies and the attorney general’s office in
the state where the company is located to see whether there have been complaints filed.
• Don’t fall for offers that sound too good to be true.
If you are a timeshare owner looking to sell, be sure to check the bbb.org website to find rating and business review information. Doing your research can help avoid being scammed!
Michelle Tabler is Alaska regional manager of the Better Business Bureau.