Overview on Timeshares

According to condominium laws and condominium bylaws, a real estate timeshare enables a title-holder to share the cost of a condo unit with many other owners. Instead of buying a condo unit outright and bearing the entire sales cost, an owner can buy a timeshare at a reduced price with fractional ownership privileges.

How do timeshares work?

All timeshare owners receive a deed to the unit for their designated week which is recorded at the county clerk's office. This deed is transferrable at any time. There are timeshare ownership plans that limit your use to 90 years and are not perpetual. You will have to find out what type of timeshare ownership you are purchasing.

A timeshare owner is given a designated one week every year to be able to use the condo unit, which will be the exact same week every year. Each condo unit has 52 owners, which represents the 52 weeks in each year. There are timeshare plans available at a lower cost where the owner is allowed one week every other year which is known as a bi-annual timeshare.

All timeshare owners are under the regulations of the condominium association law that is in place for the building. Each timeshare owner is allowed to participate in annual meetings and are allocated voting privileges. Timeshare owners are notified in advance of annual meeting times and locations by mail.

Financing for timeshares is normally done in-house. The private financing that is available has a much higher interest rate than a conventional mortgage, with rates commonly assessed at 16%. However, the private mortgage does not require stringent qualifications standards and it does not show up on your credit report, unless there is a delinquency.

Depending on each associations condominium law, timeshare owners have to split the costs required to run the building and each individual condo unit. This fee is normally referred to as the resort fee and includes costs such as the home owner's insurance, liability insurance, maintenance, housekeeping, renovations, taxes and any other necessary fees. This fee is due annually at the beginning of the year. Bi-annual owners only have to pay this fee every other year, however the bill is normally split in half and due at the beginning of each year. You cannot use your unit until the resort fee has been paid. In addition, non-payment of the resort fee can result in a foreclosure of the timeshare owner's interest.

Timeshare ownership allows you to be able to pass it on to future generations. Once the timeshare is paid off, the only cost left is the annual resort fee. Businesses can also buy a timeshare and use it as a business expense for employees for out of town meetings or as a company perk. You can also rent out your timeshare week if you cannot make it or have plans to go somewhere else. Many building can also take care of renting it for you for a small fee. With maintenance and housekeeping taken care, the overall timeshare ownership experience can be hassle-free.