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Find Your Vacaton Home: Time Shares

Do you and your partner enjoy hitting the slopes on skiing vacations or bounding off to a sunny resort in Mexico every year? If so, you may be interested in a purchasing a timeshare. Timeshares have been likened to guaranteed annual vacation destinations. A timeshare is a shared ownership of resort property that members use during a specified time each year.

Timeshares can include cruises, campgrounds, motor homes and condominium resort properties. Timeshares are popular in Hawaii, Florida and Mexico and are usually sold by real estate developers and real estate agents. However, there are different types of time shares available, so there is likely a right flexible timeshare plane for you.

Deeded Timeshare
A deeded timeshare refers to real property that you collectively buy with a group of people. For example, in a condominium with 51 condominiums you would own one unit for two specified weeks during the year. You can purchase timeshares for a certain number of years or for the rest of your life. Timeshare owners can rent, sell or exchange their property to other people as well so they are not limited to one vacation spot only. Because you are a collective owner of the timeshare, you must pay an annual maintenance fee for the resort property.

"Right to Use" Timeshare
A right to use timeshare is similar to a deeded timeshare except that it is leased ownership. This means that you buy the right to use the condo unit for a limited amount of time, usually about 10 to 50 years. Also in this option, the condominium may be separated in a points system and you may spend your collected points on vacation in the unit. There is an annual maintenance fee with this option as well.

Within the right to use option there are several subtypes to choose from with regard to condominium usage:

Fixed or Floating Time: Fixed time means you buy a specific week to use your condo unit every year. Floating time means that you use the condo during specific seasons and arrange when you’ll vacation there ahead of time.

Fractional Ownership : Fractional ownership means instead of coming every year during a certain week, you may buy a large vacation time that could be up to 26 weeks.

Biennial Ownership: Biennial ownership refers to using your condo unit every alternate year.

Lockoff or Lockout : Lockoff or lockout refers to living in one part of a unit and renting out or exchanging the left over space.

Points-Based Vacation Plans: A points-based vacation plan refers to buying a particular number of points and bartering them for use at other resorts. The cost in points for different resorts depends on how long you plan to stay, unit size, condo location and the time of your vacation.

Pros of Timeshares
There are numerous benefits to time shares sales.

 

  • You don’t have to worry about hotel locations and fees while on vacation
  • Timeshares may be cheaper than luxury vacation hotels
  • Timeshares are flexible: they can accommodate your vacation schedule; you can take timeshare vacations a few days at a time; you can invite more people along; you can change your destination
  • A good financial investment because you can pass on your deeded ownership to your children, use as a gift, or exchange it. If you want, you can even put those timeshares up for sale.

 

Cons of Timeshares
Like everything, there is also a downside to timeshares.

 

  • You must pay maintenance fees, which may increase by 4 % every year, and could cost from $200 to $500.
  • You may be locked into a lengthy financial commitment by a contract
  • A floating time condo option is a very competitive market since everyone wants the same vacation spot at the same time of year.
  • You may not be able to sell your timeshare. Timeshares can lose value over the years as popular vacation hotspots change. Additionally, people may not be interested in your property for a variety of reasons, which means that time shares resales can be difficult.

 

Tips for Buying A Timeshare

 

  • Do your research: talk to people that own timeshares, talk to real estate developers and use the internet as a research tool.
  • Find out if a condo association is listed in the Better Business Bureau
  • Visit the resort and check out the quality of the accommodations
  • Do not sign any contracts immediately, make sure you understand all the legal jargon before you sign.
  • Never pay for a timeshare upfront without first seeing the property
  • Ask for all promises and incentives in writing so you can study them later.
  • Ask if there is a period of time when you can cancel the contract.
  • This is a big investment, so don't rush your decision and purchase.