Timeshare Cancellation: What Timeshare Exit Companies Do Not Tell You!
- Stephanie Bonner
- Jul 8, 2022
- 7 min read
Updated: Aug 24, 2022
When timeshare owners want to cancel their timeshare contract, they often times look for help from timeshare exit companies. These companies typically promise to cancel the contract for a fee, but what they don't tell you is that they will never actually be able to do so! The timeshare developer will never negotiate with timeshare exit companies, meaning you lose your money.
Don't fall for this trap - timeshare exit companies are nothing more than a scam!
Below is an in-depth look at their questionable practices and what timeshare exit companies do not tell you.
What are Timeshare Exit Companies?
Timeshare exit companies, Timeshare Cancellation Companies, or Timeshare Relief Companies are companies that offer timeshare cancellation services for a fee. They typically employ former timeshare resale telemarketers and use aggressive marketing tactics to sell their services.
While many timeshare cancellation companies claim to employ timeshare lawyers, they do not, and owners of a timeshare should be leary of doing business with them.
Timeshare cancellation companies charge high upfront fees, and in all cases, they do not cancel the timeshare agreement as it cancels to default. Owners of a timeshare considering using a timeshare exit company should do their research and choose an attorney for timeshare cancellation with a proven track record of success.
Is a Timeshare Exit Company a Law Firm?
No, timeshare relief companies are not law firms. Timeshare relief companies claim to specialize in timeshare cancellation. In comparison, some companies may employ "in-house counsel"; they are not law firms.
If you're considering canceling your timeshare contract legally and ethically, it's important to do your research and choose a reputable timeshare cancellation firm that employs timeshare attorneys.
Do Timeshare Cancellation Companies Employ Timeshare Attorneys?
Many timeshare cancellation companies claim to employ attorneys to terminate your timeshare agreement. In reality, they retain "in-house counsel" to work on their legal matters. In-house counsel does not represent the company's clients or directly cancel the client's contract. They are only responsible for the company's legal matters.
Why Do They Claim To Have Timeshare Attorneys?
The cancellation process requires legal representation. Timeshare companies will only communicate with the owners or legal representative, not a timeshare cancellation company.
Many timeshare members feel comfortable having legal representation using a licensed timeshare attorney that can make legal claims. For this reason, they will retain in-house counsel and put their attorney on their website's bio to lead the public to believe they have an attorney that will represent you. These attorneys are not versed in timeshare law.
In-House Counsel Cannot Offer The Timeshare Owner Legal Advice.
Legally and ethically, exit companies cannot offer legal counsel as they are not attorneys. In-house counsel can only provide counsel to their client, in this case, the exit company.
Owners of a timeshare will not speak with in-house counsel as they are not getting timeshare legal advice from an attorney that represents them.
Owners of a timeshare must understand this distinction when considering timeshare cancellation companies.
How Does a Timeshare Exit Company Cancel Your Timeshare Contract?
A Timeshare Exit Company can claim they will terminate your timeshare agreement by using pressure tactics, and if that doesn't work, your case will be "assigned" to an attorney. In reality, this never happens.
Their timeshare exit process is as follows:
They Will Write a Letter to the Timeshare Resort
Writing a letter to the resort is something you can do on your own. A letter can make claims such as:
You were misled
You were pressured
Timeshare was sold as property
Maintenance fees were never explained
You never had enough time to read the contract
Ultimately, these claims are groundless coming from an exit company, not a timeshare cancellation attorney. The developer's management company or law firm will ignore the letter from the exit company, and you paid the exit company well over $5,000 for a letter you could have written to get the same results.
Communication will be ignored unless the letter comes from a law firm with an attorney's signature representing the timeshare owner.
They Will Write a Cancellation Letter on Your Behalf
Exit companies such as Linx legal and Wesley Financial Group offers a D.I.Y (Do It Yourself) platform.
Their process is as follows:
They Will Write the Cancellation Request
Using templates on file, the company will write a letter on your behalf making claims of fraud, purchase under duress, and other baseless claims.
Email Letter to the Timeshare Owner
The company emails you the letter because they want the letter coming from you. Why? Because they know timeshare resorts will not respond to their communication. Once the letter has been emailed, the person will be responsible for printing it, signing it, and paying for the certified mailing expense.
Client Mails Letter to Timeshare Company Directly
You will have to mail the letter to the resort's management company. Exit companies' contracts will instruct you not to communicate with the resort or management company. If you speak to the resort, you've breached the exit company's contract and will consider services rendered. You may lose all monies paid at that point.
Wait for Resort's Answer
The resort may respond to you at this point. If so, the developer's management company will explain that you have signed a contract and agreed to the terms. You can make any claims of deception or unethical sales practices using legal counsel.
When your letter is ignored, you'll be instructed by the exit company to contact them so they may write another letter. You'll enter a perpetual cycle that will not yield results.
Will My Timeshare Company Negotiate With a Timeshare Cancellation Company?
No, timeshare companies will not negotiate with timeshare cancellation companies because timeshare companies know that owners are solicited and induced by exit companies to cancel their contractual obligations.
Many exit companies induce owners to stop paying their financial obligations under the contract to succeed in their "proven timeshare exit strategy."
This puts the timeshare developer in a difficult position as they then have to pursue legal action to recoup the unpaid fees and sue timeshare cancellation companies for tortious interference.
Therefore, they will only negotiate with a law firm or timeshare attorney who can provide owners of a timeshare with legal representation.
Does a Timeshare Exit Company Really Cancel My Timeshare Contract?
It is important to know that the only way your contract is canceled using an exit company is due to default. Timeshare developers will never accept accountability for deceptive sales practices.
You can stop making payments to the resort without the guidance of these companies. However, legal consequences will follow, such as credit score getting affected negatively, lawsuits, and tax implications.
Additionally, you may incur additional fees and costs if you use one of these relief companies. It is always best to consult with an attorney who focuses on timeshare law before taking any action to cancel a timeshare agreement.
Timeshare Cancellation Companies Offer Deceptive Money Back Guarantee
Timeshare Cancellation Companies deceptively advertise a 100 percent money-back guarantee. Under the terms of companies' guarantee, customers facing foreclosure or who were already foreclosed on are not entitled to their money back because exit companies consider foreclosure a successful outcome — despite the potential negative impacts.
Because of this practice, some of the exit company's customers have even struggled to obtain home loans.
How Timeshare Cancellation Companies Get Around Refunding You Money
Timeshare cancellation companies' position is that anything that terminates the customer's contract is an "exit" in satisfaction of the guarantee. Meaning that the exit company is not obligated to provide a refund — even if that "exit" is the resort foreclosing on the customer or the customer finding some way out of the contract on their own.
The exit companies also interpreted their guarantee to mean that no refunds were owed so long as the company said they still were working on the case.
Thousands of Timeshare Owners Lose Money to Timeshare Exit Scams
If you're a timeshare owner, you're familiar with the scams of the timeshare exit industry. Thousands of owners lose money to exit scams every year.
The Timeshare Exit Team, backed by a Dave Ramsey endorsement, defrauded thousands of owners of a timeshare between $3,000 to tens of thousands of dollars in upfront payments by promising to assist them in exiting their agreements. The State of Washington ordered the firm (known formally as Reid Hein & Associates LLC) to pay $2.61 million in restitution and cease its fraudulent practices in September 2021. According to an article written by industry group ARDA, the firm appears to have closed its doors and is out of business.
The outcome left thousands of owners stuck with their timeshare. "The money-back guarantee is useless when the company is no longer in business," says Robert Ingram out of Tennessee. "We trusted Dave Ramsey and his endorsement, and now we are out of $9,000, and our Wyndham timeshare is still charging us $3,100 a year in maintenance fees."
New Law Prohibits A Timeshare Exit Company From Charging Upfront Fees
According to the bill's sponsors, North Carolina has become the first state to implement legislation regulating timeshare exit companies. The groundbreaking timeshare legislation emerged from the North Carolina Real Estate Commission's (NCREC) acknowledgment of the need for legislation to govern companies that promise to "exit" consumers from their timeshare agreements.
The American Resort Development Association (ARDA), as well as the NCREC, urged for a rewrite of North Carolina's timeshare law to include provisions regulating timeshare transfer ("exit") activity. ARDA stated that most exit firms charge exorbitant upfront service fees but do not provide the promised safe or legal exit. They advise owners to default on their financial obligations to the timeshare resort.
NCREC discovered that people who hired a timeshare exit company seldom get the advertised "money-back guarantee" and frequently suffer financial difficulties such as damaged credit and tax responsibility.
The bill's most important sections include the following:
Timeshare exit companies may not advise or suggest timeshare members cease making payments on their timeshare obligations;
Timeshare exit company contracts must provide timeshare members with a right of rescission;
Timeshare exit companies cannot charge timeshare members for a transfer or exit service that amounts to foreclosure or repossession;
Timeshare exit companies are not entitled to a fee for a transfer or exit service if the timeshare owner procures their own transfer or exit;
Written evidence of the transfer or exit must be provided and include the method of transfer or termination, along with legal documents; and
Timeshare exit companies must escrow the fee charged to timeshare members.
Use a Reputable Timeshare Cancellation Firm With Timeshare Lawyers
Advocate Financial Services is an award-winning timeshare cancellation firm that works with the best timeshare lawyers. We have a proven track record of success in cancelling timeshares, and our team of experts can help you get out of your timeshare using legal counsel.
Our timeshare cancellation services reviews are genuine from people who received legal representation and legally got out of their timeshare.
We offer a free initial consultation to determine if you have claims to cancel a timeshare using legal counsel or if you can cancel a timeshare on your own.
How to Contact Advocate Financial Services
If you are considering cancelling your timeshare, it is important to use a reputable firm like Advocate Financial Services. We have the experience and knowledge to help you cancel your timeshare. Contact us today for a free consultation to learn more about our services and how we can help you cancel your timeshare.
For a Free Consultation, Call 866-519-7368 or 754-260-1603 Today!
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