But you shouldn’t pick up a pen and sign a contract right away. For every person who says they have the best timeshares, there is someone who advocates against them. Are timeshares worth it? How do they work? Before you decide on the right one, what preparations can you make? Answer these questions and you can decide your perfect way to vacation. Here is your quick guide.
The Basics of Timeshare Rentals
Timeshares allow you to use a vacation property for one week every year. As the name suggests, you share this property with others who sign similar contracts. Timeshare companies advertise their products as a way to go on vacation for little money. You may need to pay very little upfront. Many companies offer luxury condominiums or suites in locations like the Caribbean and Hawaii.
How Do Timeshares Work?
There are two separate types of timeshare ownership. Deeded ownership allows the buyer to own a portion of the property. A timeshare deed gives the owner the legal right to rent out or sell the property as they please. Many companies promote deeded ownership as property ownership and “taking control of your vacation.” What they don’t say is that with ownership comes maintenance expenses. You may have to pay thousands of dollars to maintain your property. The other way of ownership is leased ownership. The buyer purchases their timeshare from a developer. The developer gives them the right to use a piece of property during a specific period of time. The contract lasts for several years. The buyer’s right to sell their timeshare is limited. They may have to pay a lot to leave.
Timeshare Tips
The main value in a timeshare is its affordability. It may provide a less expensive vacation to a tropical location than other packages. But that is not a given. Read over the terms of the timeshare contract carefully. Run it by a financial advisor and a lawyer before signing it. Timeshare companies are very aggressive in their sales tactics. Be adamant that you want to check the contract before you sign it. If you buy a specific week, you don’t have to make extensive preparations before going on vacation. You don’t have to worry about accommodations. You just need to book a flight and you can go. But you do need to allot that week for yourself in advance, perhaps up to a year. It may be a better idea to buy a “floating week” timeshare. This gives you more flexibility for scheduling.
So Are Timeshares Worth It?
Timeshares seem simple. You sign a contract and go on vacation to a shared property. But there are a couple of timeshare types. If you buy a deed, you own a stake in the property. But you have to pay high maintenance fees. You can get leased ownership. But you have to pay for it over several years. Are timeshares worth it? Only if you read your contract and consider options like “floating week” timeshares. If something seems fishy, don’t sign up. Enjoyed this article? Follow our coverage for more personal finance guides.
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