Timeshare is full of very specific terms which can be totally confusing to anyone not within the industry. In our endeavours to keep things clear and simple, we’ve put together this guide to the A to Z of timeshare terms you might come across when dealing with your ownership.
Abogado
Spanish term which translates to ‘Lawyer’
Accrued Time
A term used by timeshare exchange companies to mean weeks that have been banked and accumulated from previous years that can be used in the current year.
Affiliated
Affiliate resorts are those who have agreements with the exchange companies such as RCI, Interval International and 7Across.
Appartado (de Correos)
The Spanish equivalent of a UK ‘P O Box’
Banking
Banking has two distinct meanings. Firstly it is the ability for an owner, who does not wish to use a particular years, weeks or points, to deposit them for future use.
Secondly, you may also hear the term ‘Block Banking’ or ‘Bulk Banking’ which means that the resort management (usually) may deposit a large number of weeks with the exchange company. The aim of this is to give members the maximum bargaining power for their timeshare exchange.
Biennial
Biennial means ‘every other year’, in timeshare, refers to the use of a fixed week on alternate years. Members of this type will be allocated ‘Odd years’ or ‘Even years e.g. 2021 is an odd year whereas 2022 is an even year.
Blue Week
Generally accepted as a low season week.
Bonus Time or Bonus Week
This basically means an additional week which may be given to a member as a goodwill gesture or as a ‘thank you’ for signing up. It is sometimes also offered in cases where additional weeks are temporarily available. In a number of cases a small charge is payable.
‘Buy/Sell’
This is a form of (usually) fraudulent timeshare scam in which a buyer is promised that their existing timeshare will be sold against the cost of a new purchase, usually a holiday club such as Eze Group or Monster Travel.
Club/Trust System
Members belong to a club and the accommodation unit plus any associated facilities at the resort are held by Trustees. These Trustees licence a ‘Right to Use’ for members. This right is simply the use of time and does not convey any tangible asset.
Class Action
A class action lawsuit is where a collection of individuals group together to present a claim. However, this is generally only applicable in the United Kingdom and United States. European Courts have no such legislation.
Closing Costs
An American term, timeshare closing costs are the fees associated with the proper transfer of ownership from the timeshare seller to the timeshare buyer. The fees cover deed, title, and transfer services.
Code of Conduct
The Code of Conduct is a set of regulations drawn up by a Consumer Body that affect the standards of trading that must be adhered to by both the seller and the consumer. Generally a code of conduct is a voluntary set of rules and has no legal authority.
Cold Line
This is a term that refers to sales prospects who have been persuaded to visit the timeshare resort for a “presentation”. The cold line is staffed by sales representatives who do not deal with existing owners, only new prospects.
Constitution
The Constitution is the rules by which the timeshare resort is run. It contains a number of legal documents which establish the relationship between the different parties in the timeshare resort. These generally include the owner, developer, trustee, and Management Company.
Cooling Off Period
This is a legally required period in which the consumer has the right to change their mind if. No payment may be taken during this time. If the consumer wishes to cancel within the cooling-off period, there will be no obligation to pay any sums at all. In Europe this period is usually 14 days, however in the United States this will depend on local state law which in many cases is 5 days only.
Deeded
The deeded system refers to outright ownership of a timeshare week, this is secured by ‘Deed of Title’ and often registered at the central Land Registry. Deeded timeshares are not legal in the UK (therefore the Club/Trust system prevails). In Spain, the Escritura system is a Deeded system.
Destination Club
Similar to a holiday club, a destination club will promise access to mostly timeshare accommodation. However, there is no certainty over rights of access to that accommodation.
Developer
The developer is the company that owns the freehold to the timeshare resort. The developer physically builds the resort and associated facilities. They earn their profits from the initial sale of the units to timeshare members.
Developer’s Price
This is a sum estimated by resale companies to illustrate the savings to be made by buying with them. It refers to the full timeshare unit retail price of the developer. This price bears no relevance to the actual “bricks and mortar” value.
End-user Finance
This is a loan granted to a consumer in order to purchase a timeshare. This is normally facilitated by an unsecured finance agreement arranged by the selling agent and often in collaboration with an outside finance company. In the United States loans are often facilitated “in house” meaning the resort will offer finance without the need for outside lending houses to be involved.
Escritura
This is a Spanish term referring to the Deeding and Registration of a ‘Deed of Title’ (see Deeding above). In Spanish, the term Escritura literally translates to a written document.
Escrow Account
In the simplest of terms, an escrow account is a third party account where funds are kept before they are transferred to the ultimate party. It provides security against scams and frauds especially with high asset value and dispute-prone sectors like Real Estate.
Exchange Company
An Exchange Company arranges for you to exchange your timeshare with a unit in an affiliated resort. There is an Exchange fee for this and usually an annual Membership fee. Exchange company membership is separate to your timeshare contract, hence the additional fee. The major exchange companies include RCI and Interval International (II) and 7Across. 7Across do not charge membership fees.
Exit Program
Sometimes offered by timeshare companies, an Exit Program exists to allow timeshare members to buy their way out of their contract, this is usually an expensive option. In order to exit your timeshare legally, often in a more cost-effective way it may be wise to consult with a specialist exit company.
Exit Company
A company that specialises in assisting owners to exit their timeshare contract and remove any further liabilities. Be aware there are many scam companies in existence, caution and thorough investigation is needed before engaging their services.
Factoring Fee (‘Factorial’)
This is a term only used in Scotland and refers to the profit mark-up of the Management Company and included in the Management Agreement.
Fixed Time
A fixed time otherwise referred to as a fixed week contract means that your membership is for a specific week in a specific unit at the timeshare resort. It is the same every year.
Floating Time
Floating weeks are now coming under legal scrutiny and are actually already illegal in some countries. These contracts allow the member an unspecified week in an unspecified unit and often in an unspecified resort. The member needs to book way in advance to secure the exact dates desired. Effectively owners are in competition with each others because they may all be vying for the same resort and time as each others.
Fly-Buy
These are holiday packages in which the resort pays some or all of the cost of a holiday on the promise that the holidaymaker will attend a sales presentation and/or tour of the resort. Expect a high pressure very long presentation but if you have the tenacity to say no, then it could present a cheap holiday option. If you are persuaded to buy into whatever they are selling there is always the 14-day cooling-off period in which you can cancel.
Foreclosure
A mostly American used term, it is a legal process in which a lender attempts to recover the balance of a loan from a borrower who has stopped making payments to the lender by forcing the sale of the asset used as the collateral for the loan. Not really surprising that this course of action will ruin any credit reputation of the timeshare owner to whom this applies.
Fractional Ownership
Fractional ownership is the division of a timeshare property which is then sold to a number of owners. Technically, fractional ownership means that you own an actual part of the bricks and mortar along with as many as 50 other co owners. Normally there is an ownership term, at the end of which the property may be sold but only if all fraction owners agree.
Green Week
Interval International (II) designates low demand timeshare weeks (generally in low season) as ‘green weeks’. RCI would designate the same weeks as blue.
Group Ownership
Simply another term for ‘timeshare’
Guest Certificate
A guest certificate is issued by the Exchange Company and confers the right for a nominated guest (your friend or family member) to use the timeshare exchange instead of you.
Hacienda
This is the name of the Spanish Tax Office, otherwise referred to as the “Tributeria”
Holiday Club
A Holiday Club promises you a week or weeks’ holiday in what is usually timeshare accommodation. Holiday clubs can also be nothing more than concierge travel agents.
Internal Personal Contacts
Often referred to as IPC, these are sales staff whose job is to sell additional timeshare products or units to existing members.
IVA
Impuesto Valor Añadido, this is the abbreviation for the Spanish version of VAT.
Ley (Law) 42/98
A Spanish law that was enacted on 5th Jan 2019 which prohibited timeshare contracts that exceeded 50 years, where deposits were paid on the day, where the exact ownership was not specified and some other important points. This resulted in many Spanish owners having illegal timeshare contracts which are currently being annulled with return of purchase costs repaid by Spanish courts. If you think you may have an illegal contract, please call us as this is a complicated area that needs specialist advice.
Leisure Charge
A little used charged in addition to your maintenance fees for the use of leisure facilities at the resort. These are those which are shared with other guests and members such as spa and gymnasium facilities.
Levy
This is a charge often made to members of a timeshare points club in order to pay for the club administration. It’s payable in addition to maintenance fees. A Levy may also refer to a one-off charge by the Owners’ Club or Management Company in order to pay any major or unexpected costs such as storm damage.
Like for Like
Generally this refers to Exchange Companies that offer an exchange of similar quality and popularity to that which has been put into the exchange bank.
Linked Agreement
Beware of Linked Agreements, invariably you will be unaware of this and is used as a method of circumventing the laws related to the taking of deposits. The salesperson may make it seem that two agreements (i.e. the Timeshare Purchase Agreement and some sort of extra holiday scheme or voucher) are unrelated, but this is not the case and breaches the law.
Lock Off
An accommodation unit that can be divided into two independent units with an adjoining door, each have their own access.
Maintenance Fees
Sometimes called ‘Management Fees’, these are contractual annual fees that must be paid by the timeshare member to cover the day-to-day running costs of the resort. Maintenance fees, in general only rise each year.
Management Company
Often controlled by the resort Developer, the Management Company is contracted to carry out the day-to-day management of the resort for which you pay your maintenance fees.
Marketing Company
The Marketing Company is responsible for marketing and is separate from the Developer. Quite often the Developer may handle the on-site marketing; however, they usually employ a separate Marketing Company to manage any marketing that goes on elsewhere, such as online or at other resorts or locations.
Occupancy Size
The Occupancy Size of a unit refers to the number of individuals that can use the unit. The number normally includes the use of available sofa beds etc not just the physical bedrooms.
OPC (Off Premises Contact)
An OPC is a salesperson whose job it is to get people to attend a sales presentation using the Cold Line method from premises away from the resort itself. Think about being stopped on holiday by people with scratch cards, they are OPCs
OTE
Now the RDO (Resort Development Organisation), the trade body for timeshare was previously called OTE the organisation for timeshare in Europe, previous to this it was the Timeshare Council.
Owners’ Club
Many timeshare resorts have an Owners’ Club, to which all timeshare members at the resort belong. Sometimes the Owners’ Club is a company, but is generally just a Members’ Club. In America this is known as the Home Owners Association (HOA).
Ownership Certificate
This Certificate confirms your right to use or the title to the property. It may also be referred to as a Holiday Certificate or Timeshare Certificate. This is an important document and should be kept safe.
Patrimonio
This is the Spanish term for ‘Wealth Tax’ which is payable annually.
Perpetuity
The word in itself means indefinite, in a timeshare contract it infers that there is no maximum term. Perpetuity clauses have now been outlawed in Europe where the maximum term of contracts must not exceed 50 years. In America perpetuity contracts are still common place and perfectly legal.
Plus Valia Tax
Spanish version of Capital Gains Tax.
Points Clubs
As a member of a timeshare Points Club, you own a number of points which entitle you to use a certain period in a unit each year from a set choice of resorts. There has been some controversy over Points Clubs in recent years, and in many cases they are being ruled to be illegal.
Private Residence/Vacation Club
Another term for an upmarket fractional ownership, mostly in American resorts.
Property Bonds
Similar to Points Clubs. Often known as Holiday Property Bonds. They are a system for owning shares or bonds in a company that owns timeshare properties. Whilst retailed primarily for holidays they do offer the possibility of offering capital returns. These schemes are generally not regulated by the Financial Conduct Authority and as such should be purchased with caution.
Relinquishment
The action of terminating any form of timeshare ownership.
Qualified Prospect
A Qualified Prospect is a term used by timeshare sales people to describe individuals of the general demographic most likely to buy timeshare. This comprises factors such as the consumer’s income, marital status, homeowner status, and age.
Recourse Agreement
This is an agreement between a Developer and a Finance Company where the Developer pays off outstanding debts if the consumer with the finance agreement defaults. These agreements generally do not exist in Europe and are losing favour in America due to rising defaults.
Red Week
Much like the blue week mentioned the red week denotes a timeshare purchased in the high season of the resort.
Repossession
The Club or Management Company may remove your rights to use your ownership normally for for breaching the Constitution or contractual terms of the purchase agreement. This usually occurs as a result of non-payment of Maintenance Fees. The right of use could then be sold to cover the debt. Repossession cannot occur on Deeded property.
Resale Brokers/Agents or Resellers
These are companies whose business is to either buy timeshare weeks from existing owners for the purpose of selling them on to new owners, or to act as agents that put sellers and buyers in contact to facilitate a timeshare sale. They make money, usually, by charging commission on the sale.
Normally they are little more than listing agents who charge a fee for inclusion on their company website.
Resort Development Organisation “RDO”
Previously the Timeshare Council, OTE, the RDO is the trade body that governs timeshare. It’s code of conduct has no legal validity and beyond expelling members that transgress the rules they have very little weight.
Right to Use
This is the legal term for the licence granted by Trustees to a timeshare holder to use the time or points allocated.
Sales Inspection Visit (‘SIV’)
A term used by Developers for prospective buyers to stay at a resort for a few days either free of charge or at a low fee, on condition they attend a sales presentation. Though there’s no obligation to buy, the SIV is a promotional tool to encourage a purchase. See also Fly-Buy.
Season
Weeks in a year are divided into different segments by Exchange Companies, usually signified by a colour. These vary for different Exchange Companies, with Interval International (II) and RCI having their own separate coding system. Each segment represents different levels of trading power and monetary value based on the season’s popularity. In general the colours of red, white and blue are the acceptable annual division. Red = high season. Blue = low season and white =shoulder season.
Sinking Fund
A Sinking Fund or Sink Fund is a portion of your Maintenance Fee that is dedicated to keeping the furniture, fittings, refurbishments, and sometimes the leisure facilities of the resort in perfect condition for the full period of your membership; this may often include such items as WIFI or tech installations.
Space Banking
The ability to deposit a week, or points, with an exchange company. See also Banking.
SPIFF
Sales Performance Incentive Funding Formula, or SPIFF for short, is a commission payment paid by resort sales decks to reward salespeople as an incentive to sell.
Timeshare Directive
A European Union directive to all nation states to implement Timeshare laws. Issued in 2008 and generally accepted by all member states by 2012.
Timeshare Interval
Mostly an American term describing the allocation of time during which you are permitted to use your timeshare unit.
Trading Power
The Trading Power of a timeshare week refers to its value. It’s used by Exchange Companies to ascertain what equivalent exchange unit and resort you can be offered in exchange for your own. This is influenced by factors such as the size of your unit, the popularity of your timeshare week, the quality or star rating of the resort, and the popularity of the resort itself.
Trustees
Timeshare Trustees can be a bank, a group of individuals, or a Trust company that holds the accommodation in trust on behalf of the timeshare holders. It is they who grant you the Right to Use through the Ownership Certificate. Some have added responsibilities; like ensuring the continuity of the Owners’ Club. Trustees have the role of providing security to owners, should the developer go bust.
UP
Unqualified person, this rather derogatory term relates to potential clients sent to the resort for a sales presentation by the OPC team. The OPC has little opportunity to qualify the prospect before shoving them in a taxi; hence they are “unqualified”.
Warm Line
Unlike Cold Line, the Warm Line sales team work to make sales of timeshare to walk in visitors and existing timeshare holders staying at the resort.
Week 53
Of course, there are only 52 weeks in a year. However, based on the timeshare calendar, every seven years or so, a 53rd week comes up. This is generally reserved for the Developer or Founders.
White Week
RCI’s exchange programme designates any timeshare weeks falling at a time of year with ‘intermediate’ demand often described as the shoulder season (between high and low season) as white.
Have we missed any key terms you were looking for? Do drop us a line either here on our social media channels and we will get it added to the list. If you require any further information on any of the terms listed here, or on a different matter related to your timeshare, please don’t hesitate to get in touch. We would be happy to help you with any query you may have.
For more information regarding this article or assistance in any other timeshare related issues please contact the TCA on 01908 881058 or email: info@TimeshareConsumerAssociation.org.uk