Timeshare presentations promise luxury vacations at a great price point.
But some buyers and legal experts warn the contracts can become long-term financial burdens that are difficult and expensive to escape.
Pam Ledden and her husband found that out firsthand.
While visiting Nashville, they were offered free dinner and event tickets in exchange for attending a timeshare presentation.
"It practically had you crying by the end of the presentation, because it was all families, vacationing together," Ledden said.
They said after a high-pressure sales pitch, they were hooked.
The couple paid an initial $10,000 to buy in, plus $1,500 per weeklong trip.
But the excitement faded quickly. Ledden said booking popular destinations like Orlando or Las Vegas was nearly impossible.
"When you try to book it, you can't get a week," Ledden said. "It's never where you really want to be, or when you want to go."
When her husband got sick, the couple tried to cancel — only to discover that getting out would cost thousands of dollars more.
Watch as a couple explains how costly it will be to exit their timeshare:
What to know about a timeshare
Ben Farrow, a LegalShield provider attorney at Anderson, Williams, & Farrow, LLC, warns that timeshare pitches are famously aggressive and that buyers get only short windows to change their minds after signing.
"When you go home, you have cooling off periods, usually very short. Three days or maybe five days if you're lucky," Farrow said.
Farrow said many who sign up for a timeshare don’t understand exactly what they’re getting, which is the right to use a vacation property for one to two weeks per year.
"You are getting a partial ownership or a right to occupy for a period of time," he said.
Some systems allow owners to swap weeks with other timeshare properties in other states, opening the door for those who wish to travel to new places.
But in addition to purchase price, a timeshare may require owners to pay annual maintenance fees or other charges that don’t go away if you don’t use the property or if you can no longer afford the expense.
"It's a contract. You signed a contract saying I'll pay 'X' bucks forever," Farrow said.
Oftentimes, timeshares can be a good investment if you have the time and the means to travel.
"If you know the financial obligation, it's within your means and it's a place you want to go all the time, they work wonderfully for you," Farrow said.
Exiting a timeshare
If you're trying to exit a timeshare, Farrow recommends owners start by calling the vacation property directly.
According to AARP, ask for the person who handles "deed-backs" or "surrenders." The property may accept a return for a fee.
If that doesn't work, another option is to stop paying. Farrow said the financial reality often works in the consumer's favor.
"Are they going to be able to collect that money from you? Theoretically, they could, but the business economics of it make no sense," Farrow said.
He warned the move could ding your credit, so take stock of your situation.
Other options include the resale market and hiring a qualified attorney. However, be wary of exit companies that demand upfront fees.
"The brokers are willing to sell it for you, but there are closing costs and fees," Ledden said. "A gentleman told me yesterday, $3,498 to get out."
Above all, Farrow urges travelers to read the entire contract before signing. He said there is no need to sign the contract right after a timeshare presentation. Instead, take documents home to review with help from an attorney.
That way you’re aware of any limitations and you can enjoy your travels, so you don’t waste your money.
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