Timeshare Recovery Companies Pose Threat

May 26th, 2011

Timeshare recovery companies pose a new threat to timeshare owners; undermining resale values, and negatively affecting public trust in the secondary timeshare market.

Timeshare resales are still relatively new; after all, timeshare itself has only been in America for around 30 years. Added to that, there was no affordable way to mass-market anything prior to the advent of the Internet, or more specifically before Google defined the modern search engine. For all intents and purposes then,  the secondary market for timeshares is about 10 years old. As with any emerging market, timeshare resale has faced obstacles and impediments, along with some spectacular successes. Owners that decide to sell find themselves faced with conflicting information, an abundance of uncertainty, and, yes, some scams to be avoided.

While most objective observers will admit that timeshare scams are the exception, rather than the rule, they exist, and many an unsuspecting owner has been led astray by silver-tongued fraudsters. Thankfully, the timeshare resale market is evolving and growing. Legitimate and committed companies are making a difference every day. That said, owners still have to be careful… Many have paid fees to have their timeshares advertised or marketed, but are still waiting for a buyer. During this time is when I think owners are most vulnerable, and this is the very vulnerability that timeshare recovery companies exploit.

Just what is a timeshare recovery company? Typically a failed timeshare resale company with some sort of loose association with a law firm. These recovery (or timeshare advocacy) companies cold-call timeshare owners offering to ‘recover’ funds paid to a timeshare resale company. The catch is that their services require the owner to pay yet another upfront fee. If that sounds fishy to you, then you’re not alone. In a recent case involving a timeshare recovery company that came before the U.S. District Court, Middle District of Florida, the Judge included the following in his report:

The Court views Plaintiff’s description of its business with some skepticism. The intended customer base includes individuals who previously made disappointing purchases of time share units (often as the result of sophisticated sales techniques) and who thereafter availed themselves of high priced resale services that failed to deliver as promised. Such individuals must be seen a vulnerable population. Plaintiff’s business includes inducing these individuals to purchase yet additional services with respect to their time shares.

Beyond the dubious nature of timeshare recovery companies, the strategies these firms encourage owners to use in order to pursue a refund often constitute criminal behavior! Owners are given form letters, and told to sign and mail them to the timeshare resale company in question. These letters regularly violate state and federal extortion laws, contain slanderous statements, and constitute defamation; making the timeshare owner themselves criminally liable, and subject to prosecution.

There are free and legal ways for owners to address grievances with resale companies. By getting involved with timeshare recovery companies, owners have nothing to gain and potentially everything to lose… Consider yourself warned.

Entry Filed under: Avoiding Timeshare Scams,Resale Market,Timeshare Owners