Thursday, January 12, 2017

Not One, But Two Important Meetings

Greetings timeshare owners.

Announcing two important meetings:

Sunday, February 19th, the National Timeshare Owners Association will hold it's regional Florida meeting.  Call 727.502.6877 Extension 1001 to register.

Sunday, March 19th, the Florida Timeshare Owners Group will hold it's Spring meeting.  Call Frank Debar at 941.351.1384 to reserve your place.

Things are changing...not necessarily for the best.

Learn what you need to know to avoid being scammed.

See you there.

Friday, January 6, 2017

No Real Estate...So Why Closing Costs?

Lately, I've reviewed a number of timeshare sales contracts and to my dismay, discovered that developers were charging and consumers were paying "closing costs" when there was no real estate involved.

Here is how Wikipedia defines closing costs:

Closing costs are fees paid at the closing of a real estate transaction. This point in time called the closing is when the title to the property is conveyed (transferred) to the buyer. Closing costs are incurred by either the buyer or the seller.

Pretty straightforward to me.

Later in the document are examples of what can be included in closing costs.  I found these three particularly interesting:

  • Attorney (Lawyer) Fees, paid by either or both parties, for the preparation and recording of official documents. The principals and/or lender may each be represented by their own attorney. Typically required by institutional/commercial lenders to ensure documents are prepared correctly.
    • Appraisal Fees, usually paid by the buyer[citation needed] (although occasionally by the seller through negotiation), charged by a licensed professional Appraiser. Many lenders will require that an appraisal be performed as a condition of the mortgage loan. The purpose of this appraisal is to verify that the sale price of the property (upon which the underwriting of the loan is based) is equal to or less than the fair market value of the property.
      • Inspection Fees, usually paid by the buyer[citation needed] (although occasionally by the seller), charged by licensed home, pest, or other inspectors. Some lenders require inspections (such as termite inspection) to verify that the property is in good condition, which is necessary to assure that the property will retain the necessary collateral value to secure the mortgage loan.
So, assuming the timeshare in question is in fact real estate (if you are unsure, I strongly caution you to STOP and figure it out), you should be asking these questions:
1)  Were you represented by an attorney at time of purchase?
2)  Was an appraisal conducted on the timeshare and did you have access to it before you purchased?
3)  Was an inspection done on the exact piece of real estate and did you have access to it before you purchased?
STOP blindly paying fees without asking questions.

Thursday, December 8, 2016

Are The Good Guys Doomed?

Another day, another sad e-mail.  I've redacted name of the resort, although truth be told, I'm sick and tired of redacting the name of companies that continue to engage in these practices.

I'm sick and tired of unsuspecting prospective timeshare owners being told that if they no longer want the timeshare that the developer will buy it back.  I'm sick and tired of finding out that the average resale price of a timeshare is $15.  And yes, I'm sick and tired of consumers doing no research at all and just accepting the salespersons' word as gospel.

Lisa - I must admit that it floors me to be reading all these other (name redacted) time share owner's blogs. My wife & I are in the same nightmare these other people are. Unfortunately, we made this terrible mistake twice when we finally did use some points & take a short vacation at their place in the Dells. We "had to" go see one of their reps in Christmas Village to be schooled a little more on the program. We were victims of a well thought scam in being told we got our points extremely cheap by mistake & were put in at a higher level than we were supposed to be at. With this "mistake" we had the privilege of taking advantage of their mistake & buying more points at half their value. Sucked in by a very believable rep, we walked out of there with 25,000 points & much more debt. It has been two years since & we have not been able to use them, due to my wife falling ill to cancer. The medical bills had stacked up, along with the (name redacted) maintenance fees. It sucks only using the program once in 4 years, while paying thousands into them. We need out like all these other nice people. Any help would be appreciated.

I'm sure this is a nice guy.  I'm sure the majority of the nearly 800 e-mails I have in my inbox come from nice guys.

Are the nice guys doomed?  Have the bad guys won?

Thursday, December 1, 2016

New Information on CWR/Festiva Class Action Suit

There's news on this matter:

Festiva Class Action Settlement
This webpage was created to provide you with additional documents regarding the pending settlement in the case known as Reeves, et. al v. Zealandia Holding Company, Inc., f/k/a Festiva Hospitality Group, Inc., et. al. Case No. 6:13-cv-00597-28TBS.

Attorneys for all parties attended a hearing with the magistrate judge on July 7, 2016 and requested that the court finally approve the settlement. At the hearing, the magistrate judge told the attorneys that he expects to issue a report and recommendation for the judge to finally approve the settlement. 

Once the judge receives the magistrate’s report and recommendation, he will then decide whether to finally approve the settlement. We do not have a timeframe on when the magistrate judge will issue his report or how long the judge will consider the report prior to issuing an order.  Any additional information regarding the settlement can be found on the Class Notice that was previously mailed to all class members and the documents found herein.

The documents referenced below can be viewed by clicking on their respective links.

Monday, November 21, 2016

The "Myth" of a Timeshare Repurchase Program

Lots of discussion lately about various timeshare repurchase programs.

Today we are reprinting a piece that discusses the one offered by Club Intrawest/Embarc.  Read it.  It has implications for ALL timeshare owners.

As Club Intrawest/Embarc members grow older and their families mature (or their health changes) vacation needs are re-evaluated. For many, retirement brings the time and the opportunity to take more vacations at the Clubs. For others, a fixed income, poor health or a change in vacation preferences means that they would like to take advantage of the much-touted "repurchase" program offered by Intrawest for members who purchased their points before 2013 in order to get some money back for their points. 
Here's what Embarc has posted on the FAQs in the HOA section of the Embarc website:
What is the Embarc Repurchase Program?
A Resort Points Repurchase program was created for long-term members who have owned their Embarc Resort Points for a minimum term of 5 years and who must have purchased their Resort Points from Intrawest directly on or before February 13, 2013 or from IROC U.S. or RVLP on or before June 30, 2013, whichever applies. This program offers eligible members the opportunity to have their membership repurchased. Members who apply within the calendar year are eligible to have their membership considered for repurchase in January of the following year on a first come first served basis. There is no guarantee that sufficient funds will be available in any given year to repurchase Resort Points of all Members who apply. The attached form can be completed by any Embarc member making a request to register their Resort Points for this repurchase scheme. Please click the question link above to access the Repurchase Request form for Embarc ownership. Fill out the form completely and send either via mail to The Landing, #326-375 Water Street Vancouver, British Columbia, Canada V6B 5C6, via fax to 604-682-7842, or via email to Once received, your member services team will submit your request for consideration.
What the Repurchase Program really is...
Sounds good doesn't it? A way to give back your membership to Embarc and a guarantee that you get money back in exchange. The statement above, which DRI has posted on the member site, may get you high on hope but it is short on details. In fact, there are many caveats*:
1) the dollar amount budgeted each year for the repurchase of member points is limited to 1% of the Developer's last year's sales
2) the developer will pay varying amounts based on these criteria:
  • each qualified member who has owned all of his or her tendered resort points for less than 8 years will be paid a purchase price equal to the lesser of sixty (60%) percent of the original purchase price or forty (40%) of the lowest current sales price charged by any developer on a sale of the same number of resort points as at the date that the repurchase request was received by Embarc.
  • each qualified member who has owned all of his or her tendered resort points for 8 years or more, will be paid a purchase price equal to the lesser of one hundred (100%) percent of the original purchase price or forty (40%) percent of the lowest current sales price charged by any developer on a sale of the same number of resort points as at the date that the repurchase request was received by Embarc.
3) for the purpose of this program, original purchase price means:
  • for all tendered resort points purchased prior to November 5, 2005, the original price paid for the tendered resort points (excluding all applicable taxes) paid in connection with the purchase of the tendered resort points and any payment for resort fees
  • for all tendered resort points purchased after November 4, 2005, the original purchase price means the purchase price paid in connection with the purchase of the tendered resort points and any payment for resort fees, less the sum of $600.
* Disclosure: these three points are based on the details in Table 16 of the Club Intrawest Instruments dated 2006. Embarc may have changed the criteria, but if they have, (in my opinion) it is unlikely to have been in a way that advantages members positively.
Let's read through this again to understand exactly what is being said
So let's assume that Embarc sells about 300,000 points a year (there are about 4.4 million points total in the trust with about 6 to 8% belonging to the developer so this is an extremely generous amount) at an average price of $175cad (a price several members have quoted as being the final, offered price for a purchase of points at a sales meeting). This means Embarc would have sold about $52,000,000 of points in a year. Therefore, if 1% is allocated, $525,000 is set aside for the repurchase program. Assuming that Embarc gives back, on average $10,000 per membership, this means about 50 memberships are bought back per year which is what has been reported back as the member progress up the list. It's less than 50 if they are giving back more than $10,000 on average. 
1) 1% of the developer's last year's sales is set aside to repurchase member points. How much is that? We don't know because we don't have access to the developer's financials (only the Club's). What we do know, because of members reporting this, is that they have been moving up the waiting list by about 40 to 50 positions per year. 
2) the purchase price: the lesser of either 60% or 100% of purchase price (depending how long they were owned) or 40% of the lowest current sales price charged etc.
How much are members getting back for their points? The lesser amount.
So, for the purchase price calculation, you can calculate how much you would get if you take the amount you paid (for me, $125 a point in 1997) and I would get $75 a point at 60% (if a shorter-term owner) or $125 a point at 100%. 
My Calculation:
If the lowest current sales price was $200 per point, I would get the lesser of $125 or $80 a point. It almost always works out to the 40% of the lowest current sales price being the lesser value. This means I should get about $10,000 for my 120 points when my turn comes up.
There is, however a major problem!
What is this problem? It's that so many members have put their names on the repurchase list that according to the last report in our Facebook group, a member adding their name to the list today would be in the 3000+ range on the list. That's right - there are so many members on the list that it could take about 50 to 60 years before your turn came up!
Why is this happening?
It's because there is no secondary (resale) market because of the policies put in place by the developer which restrict the resale point owners to using their points only within Embarc (no ExtraOrdinary Escapes, no Interval membership). If there were a secondary market with points being sold at a reasonable price, members would not be "forced" to relinquish them to DRI. Therefore, the only possible way to get out of the membership is to either sell one's points at bargain-basement prices ($20-30 per point has been quoted recently), give it to someone or to simply surrender them back to Embarc so the member does not have to continue to pay the yearly fees.
If you were thinking that the Repurchase Program was going to be your "exit strategy" from Embarc, think again!

Friday, November 11, 2016

New Attorney Named in Ongoing Manhattan Club Case

This is far from over.  This is maybe the fourth attorney on the case.  Let's hope something good comes out of it.

Here's the information:

The new lead attorney on the TMC case is Elissa Rossi. She replaces Serwat Farooq.

Next Manhattan Club Court Hearing

Court: New York Civil Supreme

Index Number: 451536/2014



Future Appearances:

Appearance Date: 02/03/2017

Appearance Time:

On For: Motion

Appearance Outcome:



Comments: 2:30 PM