After several months of talking to timeshare Consumers it still shocks me to hear how much money is being lost in this industry. Below is one particular story that I still can’t believe.
“On the 15th October 1998 Mr and Mrs Consumer acquired timeshare at Palm Beach Club situated in Tenerife (the property is owned /managed by Resort Solutions).
In approx 2004, Resort Solutions invited the Consumer to a sales presentation. It was explained that the original investment could be salvaged if they added the original investment to more timeshare products.
In March 2005 and upon advice from Resort properties, the Consumers were invited to reinvest the original investment in 3 properties at The Hollywood Mirage on guidance of Resort Properties.
It was a representation that in respect to the first property they would acquire the timeshare for £9,707.00 and within 5 months it would sell for £18,000.00. In respect to the second offering they would acquire two for £6,472.00 each and the 2 would be sold five months later for the sum of £19,950.00.
Therefore one timeshare was sold at a value of £9707.00 and two timeshares were sold at a value of £6,472.00 each.
The total acquisition made by the Consumers in 2005 was £22,651.00.
In consideration for this amount the seller took in part exchange the existing properties which the Consumers owned however those properties must have had a negative value as the Consumers paid a further £5000.00 to ensure that the three properties noted above were acquired by them therefore:-
Property acquisitions equal £22,651.00
Consideration for burden £5,000.00
Total: £27,651.00
It was a verbal representation that the three timeshare investments would yield (by August 2005) a profit and that profit is identified as follows:-
Property acquired for £9,707.00 would sell for £18,000 which equals a profit of £8,293.00
Two properties acquired for £6472.00 each which totals £12,942.00 would sell for £19,950.00 which equals a profit of £7008.00
The total projected yield of the investment and represented by Mark Rowe would be £15,301.00
In August 2005 the profit did not materialise and the Consumers were persuaded to reinvest the previously identified stock in Club Paradiso however this further reinvestment would cost £13,000.00 however the advice offered would yield a return of £40,000.00 in 18 months time.
The Consumers took the advice of the seller and paid a further £13,000.00.
In January 2007 the Consumers were advised by the resort to retain and upgrade their investment. The upgrade required a further payment of £19,000.00. Again the resort represented that if this upgrade option was taken their investment would sell in two years time for £61,440.00. There was a caviat to this prediction in that it was subject to the approval of the developers.
In January 2009 the predictions as expressed in 9 above did not materialise and it was represented that Club Paradiso was suffering problems in that it could not be sold on. That said the Consumers were offered to change their existing investments into charter pool. If this were done it would secure some value in respect to the previous investments.
To facilitate membership of charter pool the salesman represented that the Consumers upgrade their membership to platinum level. The salesman further expressed that the current portfolio of timeshare properties would be reinvested and a loan from Barclays in the amount of £31,250.00 would be arranged if this was done it was explained that the investment would be sold for the sum of £92,500.00.
Whilst being a member of Charter Pool this would bring an annual return of £9000.00 and this amount would cover any and all repayments in respect to the loan.
It was a verbal representation that this financial mechanism would not alter and that the Consumers would not in any event be at risk of indebtedness to the bank.
Within the first year the Consumers received the sum of £6,140.80. In the second year they received the sum of £1,082.50. In the second year the rules and/or contractual terms contained in the Charter Pool scheme were either altered or amended.
Due to the amendments no further income was received. In May 2011 the Consumers received notification of a change of ownership which was from Resort Properties to Silverpoint Vacations.
The Consumers responded to the letter with an explanation of what had happened in June 2011. A representative was instructed by Silverpoint to offer £12,000.00 for the timeshare properties in Club Paradiso. This offer was accepted and as such it was a further representation that maintenance fees would not be due.
No transfer and/or sale took place.
In September 2012, the Consumers met with another representative who agreed an exchange in that the membership of Club Paradiso could be exchanged for two weeks at the Beverly Hills Club on the condition that the Consumers paid a further £5000.00. It was an express representation that whilst the Consumers owned at The Beverly Hills Club they would not be responsible for forward maintenance fees. During the presentation and after a telephone call with the representative, it was represented to the Consumers that the timeshare in The Beverly Hills Club would sell very quickly.
In October 2013, the first representative of Silverpoint Vacations explained that there were difficulties in selling Beverly Hills Club timeshare however if they exchanged the existing timeshare for Beverly Hills Heights timeshare they could be sold later for the sum of £5000.00 each, again maintenance fees would not be due as they would be paid for by the buyer in the reselling process.
Despite the assurances the Consumers are receiving maintenance fee notices and threats of legal action. In the event that these invoices are not paid the Consumers will lose their membership”.
Lesson to be learnt – You worked hard for your money, do not flush it down the toilet because a stranger tells you that you can trust them.
Sharing these kinds of experiences has proven to be invaluable to Consumers. Remember that you are 1 of thousands caught up in turmoil with timeshare resorts. You can get out and you DO NOT have to pay thousands upon thousands of pounds OR buy points/holidays to do it.
Do your research & call the TCA!
The Time Timeshare Consumer Association is a not for profit organisation. It has extensive costs in supporting timeshare Consumers and as such, we rely upon the generosity of individuals, communities and businesses so as to provide a continuation of the free services that we offer.
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