BBB President gets lots of timeshare complaints

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LONGWOOD – Judy Pepper knows that vacation ownership properties are very popular in that tourist and resort Mecca known as Central Florida.

“A lot of people love their timeshare,” she said. “Florida is a huge timeshare market. Some own more than one.”

Pepper often hears from these folks – but not because she’s involved in real estate and timeshare resales, or because she works for a developer who builds them. Pepper hears from people who are angry that their decision to get into the timeshare ownership field has created huge, mainly financial, problems for them.

“We hear primarily from the people who are trying to sell,” said Pepper, president of the Better Business Bureau of Central Florida, located in Longwood. “But sometimes we do get complaints from people who purchased a timeshare from a developer and felt they were misled by the developer. But we see less of that then we do scams involving the sellers.”

The BBB has been warning timeshare buyers and sellers that scams in this field are widespread, and there are some simple tips they can use to protect themselves from becoming the next victim.

For buyers, she said, the biggest complaint is they got offered a very low cost vacation at a popular resort, as long as they agreed to attend a presentation – or sales pitch – on the benefits of timeshare ownership.

“When you talk about buyers, there are people who do buy at the retail market, but from the side of buying, we generally see those types of complaints come from people dealing with timeshare developers,’’ Pepper said. ‘’They get an offer of a free vacation, and it requires you go through a timeshare presentation where you’re pitched about the advantages of it.’’

In some instances, she said, the buyers feel like they were oversold on what they were getting.

But more often, Pepper said, it’s the sellers of existing timeshare units who are calling her office with complaints.

“Timeshare resale and marketing business scams are probably in our top 5 for complaints, and have been for a number of years,” Pepper said. “People have always tried to get rid of their timeshare, and now because of the state of the economy, they really want a way out and no longer want to pay those timeshare maintenance fees.”

Often times, the sellers get contacted by a resale firm – and not the other way around, Pepper noted.

“Their pitch is they can sell your timeshare in 60 to 90 days,” she said. “Some of them even claim there are overseas buyers or corporations that want to buy them. But their pitch is always different from the agreement they have you sign.”

Pepper said if the sales pitch makes it sound great – that buyers are already lined up, that the resort where the seller’s timeshare is located is a hot property right now, or that they can get a really great price for it – that should be a red flag.

“They claim it is going to sell very easily — and it is <em>not</em> going to sell easily,” she said. “The most they will do is advertise your timeshare on their web site. They’ll say they’re an advertising company in the actual contract that people sign, but most people are led to believe in the sales presentation that there’s a buyer ready, or that their resort is very popular and it will go quickly. Consumers don’t realize there is a problem until a year later, when they don’t get any offers and then they complain to the company, but sometimes the company is gone at that point.”

One of the biggest complaints is that sellers are asked to provide up-front fees to cover everything from advertising and marketing to administrative fees – money that the seller loses when they discover, all too late, that their property isn’t going to sell in a tough market.

“Consumers are led to believe there is going to be a sale, and to get rid of that additional cost of their maintenance fees, they sign it and then they’re stuck,” she said.

The Better Business Bureau recommends that timeshare sellers never pay up-front fees, that they don’t offer to pay any fees in cash or through wire transfers, and that they get everything in writing first.

“Certainly get everything in writing before you give them a credit card number,” Pepper said. “Don’t believe there is someone out there looking to buy your timeshare. If you look at any of those timeshare sites, you will see there are hundreds of thousands of properties being listed.”

Beware of false marketing techniques, she added.

“Some of them will indicate they go to conventions, but that might just mean they have a booth somewhere with a list of timeshares for sale,” Pepper said.

Some of the victims, after they have been scammed the first time, get contacted again by a company claiming they can help them recover the money they lost – for a fee. This, too, Pepper said, is just a part of the overall scam.

“It’s the infamous re-loader scam,” she said. “Some of these very same companies have a database of all the timeshare owners, and they come back to them a year or two later, and a lot of their re-loader scams claim to be advocates who will help you get your money back if you’ve been scammed. What they provide is a list of letters you can sent to the timeshare company, but they may be gone by then.”

This problem has become so widespread that the Florida Legislature just passed a new bill aimed at cracking down on timeshare resale fraud. Gov. Rick Scott is expected to sign the bill, which would go into effect on July 1 and establish new standards that timeshare resale firms need to operate under, including providing a contract to sellers before asking for any money.

“This has been an ongoing problem, because we have so many timeshares in the area, and so many timeshare marketing companies in the area,” Pepper said, adding that timeshare sellers should consider skipping the use of timeshare resale firms altogether.

“Do your research,” she said. “Go back to your own resort. See if you can make any arrangements with them, or just advertise it yourself. You may be able to advertise it much cheaper in your own town, and you will not be paying that huge fee. We’ve seen consumer pay up to $1,500 — and get nothing in return.”

To learn more, contact the Better Business Bureau of Central Florida at 1600 S. Grant St. in Longwood – which is open from 9 a.m. to 4 p.m. Monday through Friday – or by calling 407-621-3300 or 800-275-6614, or emailing [email protected] or [email protected].