Wednesday, May 20, 2009

Protect Yourself from Timeshare Scams and Resale Fraud

This week NBC news reported, through their affiliate in Rochester KTTC, that a local woman was swindled while trying to sell her timeshare at Christmas Mountain Village in the Wisconsin Dells.

The 39-year-old woman searched the internet and found a company she thought would sell her timeshare. In typical fashion with timeshare scammers, the woman was asked to pay up front, and in good faith, she sent in her $1,800 last March. The company promised to fulfill her request and told her the money would be refunded upon the sale of her timeshare property.

Unfortunately, 2 months later, the woman has still never heard back from the company, and although she has filed a police report, the chances of her receiving her money back are slim.
This story is too common and there are many different versions of timeshare scams and fraud that have been robbing innocent and trusting owners of their hard-earned money for years.
One of the oldest scams is when a timeshare owner receives a cold call from someone who claims to have a hot buyer for their property at a price slightly lower than the asking price. The owner agrees to sell through him. A few days later the representative calls to say that a fee is due to cover "advertising" costs, and that "state regulations" require that the owner record a statement saying that the money to be paid is for advertising only. The money is sent and months pass with no sale. Follow up calls by the timeshare owner finally reveal that there was no buyer and the “advertising” money is not available for refund.

Don’t let this happen to you. The best way to ensure a safe transaction in the sale of your timeshare is to use an escrow service that will hold funds until the delivery of the deed. Entering into an escrow agreement is the only sure way to prevent fraud because the escrow company handles disbursing funds between the buyer and seller. They will also obtain the signatures for all closing documents, collect payment from the buyer, prepare the deed, and coordinate the transfer with the resort's Home Owners Association (HOA).

At RedWeek.com we take fraud very seriously, and make every effort to prevent it from occurring, which is why for escrow services we recommend the First American Title Insurance Company and their National Vacation Ownership Division (NVOD). They are a Fortune 500 Company that has been in existence over 100 years so it’s a name you know you can trust.
For those timeshare owners who prefer to work through a broker, ask for their name, company name, license number, and state where licensed. Use an online resource, such as Arello, to make sure their license is active or contact the broker's state regulatory agency.

The best way to protect yourself is to be educated about these fraudulent practices and use reputable businesses with safeguards for your protection.

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