Timeshares and Vacation Clubs

Timeshares and vacation clubs are tempting, and consumers who’ve had success in buying them say they keep costs under control and increase their opportunities for happy holidays.

But others complain to the Ministry of Government Services about these types of memberships. More than 500 consumers tell the ministry each year that they believe they were pressured into making an on-the-spot decision they regretted almost at once. Then they found they were unable to get out of the contracts they had signed.

If you’re inclined to sign up for a timeshare unit or vacation club, the ministry suggests you do a lot of research before you buy and keep the following smart-shopping tips in mind.

Quick Tips

Never sign a contract until you’ve seen the property. Vacation-minded consumers tempted to buy a timeshare property, which may cost many thousands of dollars, should make sure they know exactly what they are getting into. Ask a lot of questions and read the contract carefully. Some people have lost money to scam artists who presented glossy brochures describing beautiful resorts in a vacation area. When they showed up to stay at their timeshare unit, they discovered there was no such address.
Research your vacation destination at a timeshare property. It may be easy to trade your time in one unit for others all around the world, but it can also be difficult or impossible to arrange a swap for a popular area for a particular time period.
Find out how much maintenance fees will be. Do you pay them based on a percentage of the annual fee or just during your vacation allotment? If they increase periodically, how is the new price calculated?
Have the contract reviewed by an independent lawyer. If the salesperson says the offer is "one-time only" and you have to sign on the spot, maybe you should consider dealing with another company. Once you decide to invest in a timeshare property, have your contract checked by an independent local lawyer – not one that is associated with the timeshare company – and if you are buying in another jurisdiction fax a copy to your lawyer. Consumers are cautioned about signing contracts for large sums of money in a location where they know very little or nothing about the legal system. Buyers could find out the hard way that they are liable for any accidents on the property or that they are not covered if the resort is ripped apart by a storm. Good legal advice is the best protection.

Your Rights

You’re entitled to a 10-day cooling-off period, in which you may cancel your contract for any reason. To do this, you need to provide notice to the supplier — preferably, by registered letter, fax or e-mail in order to ensure you have proof of delivery.
Consumer agreements must disclose specified information. If a company isn’t delivering on the contract or if you encounter an aspect that wasn’t disclosed as part of the deal (e.g. an annual renewal fee), you have the right to cancel within one year. When a consumer and business are engaged in an ongoing contract and the business decides to amend the contract, it must inform the consumer and provide them with an updated version of the agreement. Contracts can be actively renegotiated, but the consumer must explicitly agree to the changes. Then the supplier must follow up with an updated version of the contract.