Saturday, August 19, 2017

Exclusive Interview Regarding RCI's Acquisition of DAE

I don't know about you, but I was shocked to read of RCI's acquisition of Dial An Exchange (DAE) last week. I reached out to Francis Taylor, DAE's CEO for an exclusive interview. 

So, Francis---big news in the world of timeshare exchange. What can current DAE members expect both in the short term (3-6 months) and long term? 

Members can expect the same high level of customer service and attention they have always known and come to expect when dealing with our company. It is 'business as usual' and DAE's role won't change from being a service provider in the timeshare industry in the 'Exchange' space. We will continue to operate from our existing offices and keep our website for our members who enjoy working with us via website and online services. Going further forward our members can expect that exchange opportunities will be enhanced as we find our way through this new relationship of having new owners. There are a great many synergies between RCI and DAE and given we both operate in the same space there are some obvious areas in which we can co-exist and support each other to help grow our respective brands. Importantly this will raise member satisfaction levels when it comes to obtaining their desired exchange holidays. 

The companies have quite different business models as I know from working closely with you both for a number of years---what do you see as the biggest challenge to melding those two? Will DAE continue to have their call centers or will those be eliminated?


Yes, we do have very different business models and that's probably why we complement each other's business goals. We attract different demographic audiences.  DAE operates under a 'low cost' business model and we've been able to build on that niche in the market. DAE is primarily focused on direct-to-consumer transactions with individual timeshare owners and HOAs and that has worked for our brand for 20 years. 

So, melding the two is more about how we can collaborate behind the scenes to complement each other’s businesses and strengthening our back office capabilities to both drive our individual business goals and support the industry as a whole. DAE will continue to operate as a separate and individual brand and entity. We will retain different call centers to RCI, our own staff, our own color (we love blue!), our own style of marketing and customer service initiatives, and our own support programs of HOAs, resorts and infustry partners.

Going forward, when a consumer purchases a timeshare interest at an RCI affiliated resort, will they receive an RCI membership, a DAE membership or both? 

I don't expect dual memberships will be offered at time of sale to both as common place. RCI & DAE will compete for our business by offering our individual services, product range, and industry support programs as we currently do now. It's also timely to remember that individual timeshare owners have a choice of who they want to call on to provide an exchange service, just as we do as individuals in all areas of our lives when it comes to purchasing a product or service.



I know in the past there have been some issues with RCI Points members not being able to deposit and then use DAE for an exchange. I trust that these issues will no longer be a problem? 

It's still early days and we have many topics and issues that will need to be raised; examined to see where things sit; what makes sense; how we can cooperate to get the best result for both entities and allow consumers to benefit. As I said earlier, RCI & DAE are different businesses, with different drivers and ways of conducting business. We won't always agree on everything, and we each need to stay true to our own business models and the direction we're reaching to achieve.

Will DAE now begin to affiliate resorts as RCI does? 

DAE is happy with the way we interact and work with resorts. Our point of difference has always been to work with individual owners and do the very best we can for them. We've always found most resorts honor their owners’ wishes when it comes to working with an exchange provider so I'm not sure how much of a change will be considered going forward on this issue. 

Lastly, does this acquisition signal the start of more acquisitions in the future in your opinion? Are the days of the secondary and tertiary exchange companies coming to a close?

That's probably a question for others as DAE isn't looking to acquire another business. As for a future place for different sorts of exchange companies, yes, I believe there is. Our industry is as massive as it is global and humans are funny creatures. We like to have choice, we like working with people or a business with whom we feel a connection and comfortable, and in many cases, we like to work with somebody 'local'. With that said, it's hard to imagine in the 21st century that choice will be a word or option that disappears from our vocabulary!

Many thanks to Francis Taylor who took the time for this exclusive interview in what I can only assume is a busy time for him. 

So, timeshare owners---what are your thoughts on this development?

Thursday, August 17, 2017

Big Changes

As most of you know, I started Timeshare Insights and the blog “The Word From The Timeshare Crusader” with one goal:  to be a catalyst for positive change within the timeshare industry.


I’m pleased to say that I’ve helped a lot of timeshare owners and prospective timeshare owners.  While I’ve garnered some terrific media coverage from such outlets as CNBC, The Chicago Tribune, Senior.com and WGN-TV, it’s not about the media coverage, it was always about helping consumers and attempting to move the timeshare industry forward despite its stubborn intentions to stay stuck in the 1970s.


Today, in 2017 consumers are being ripped off in record numbers, there’s a never ending array of so-called “experts” who are hawking their latest company designed to prey upon unsuspecting timeshare owners and the industry has taken little or no steps to change an outdated marketing and sales structure which continues to foster a sense of distrust with consumers.


Despite that, I believe that timeshare has great potential.


So, it’s time for some changes.


Effective today August 17 2017, The Word From The Timeshare Crusader has been redesigned and relaunched as The Timeshare Crusader Blog and can be accessed directly on http://www.timesharecrusader.com and on Twitter at @TheTSCrusader.  It will have more news, more guest bloggers, more features and will of course; maintain my own independent voice as the main blogger.


I continue to tweet at @LisaLooksAt and will remain as the timeshare contributor at Senior.com.


Additionally, I continue my important work with the National Timeshare Owners Association which is celebrating 20 years of educating, advocating and encouraging responsible timeshare management and ownership.

In conclusion for today:  If you like what I’ve been doing for the past 12 years or so, stay tuned, it’s going to get better and more positive changes are just around the corner.  If you don’t like what I’ve been doing for the past 12 years or so, here’s a quote from Star Wars to get you thinking; “You can't win, Darth. If you strike me down, I shall become more powerful than you could possibly imagine.”

Saturday, August 5, 2017

A Code of Ethics....Good Only if Enforced

Today we hear from a Guest Blogger describing her experiences at a DRI resort and her follow up with ARDA as to alleged violations of their Code of Ethics.

My husband and I feel we have been deceived by Diamond Resorts International, and ask for your assistance in getting justice for our victimization.

In November of 2016 we stayed in one of DRI's timeshare resorts in Sedona, AZ through our Interval International membership. While there we attended a DRI sales presentation. The hotel concierge gave our family of 4 a $150 gift card to a local restaurant for our thanksgiving meal, and in return we were to attend a 90-minute sales presentation. The presentation ended up lasting 6 hours, with our sales agent becoming agitated when we said we needed to leave due to my husband's golf tee time. This violates ARDA's Code of Ethics of "Information".

The sales agent, Karen Calvano, empathized with us about our inability to stay in resorts unless located close to home which is in Houston, TX. She said she knew Interval International did not have many resorts in our area, but that DRI had many resorts, and we would certainly be able to find resorts in Texas, New Mexico, and Louisiana. As it turned out, DRI's resorts in our area are owned by affiliate resorts rather than DRI and costs approximately more points than we were sold. This violates ARDA's "Exchange Program" in which we were over promised on the likely hood to exchange for Diamond’s inventory in our area.

When I looked on the Diamond member website recently, Diamond’s Great Wolf Lodge affiliate property in Texas was available for 26,911 to 66,467 points. If we multiply 26,911 by 20 cents which is the typical cost of maintenance fees, it would cost $5,382 for a one week stay. Booking.com had the same Family Suite available for the same week for $1,700. This is not an unusual scenario. I have searched various times throughout the year.

We attended DRI's "Event of a Lifetime" in January, 2017 which we were told was our member orientation. The “orientation” turned into a high pressure sales presentation quickly with misleading information regarding redeeming our points for 30 cents per point if we paid to upgrade our membership to platinum. When my husband, Dr. Mark Grant, asked to see the price per point in writing, the sales agent pointed to his own written notes to show us that it was legitimate. My husband pointed out the documented literature which showed the amount at 10 cents per point, and the salesman quickly dismissed us to the next sales agent.

According to the ARDA Code of Ethics, this sales agent violated the ethics standard of "Avoidance of False and Deceptive Statements".

Mr. Clements, as you can tell from the brief account I have written, we are in a rough situation with devious minded people who have not followed ARDA's Code of Ethics, and should therefore be forced to let us out of our contractual agreement.

We appreciate your consideration, and assistance!

Sincerely,
Eron Grant


Response from Diamond
I am responding to your concerns regarding availability in Texas and Louisiana. While Diamond Resorts does not own or manage any properties in these states, we do have affiliate agreements with several resorts. These properties offer us limited inventory each year to offer to our members to book with their points. Inventory is typically limited, and prices are set by the properties themselves, and not by Diamond Resorts. These properties are offered on a first come, first served basis in addition to the Diamond Resorts properties covered under your contract.
Diamond Resorts does offer a property in New Mexico, the Villas de Santa Fe. If you would like assistance booking at this property, please let me know and I will be happy to assist.


My Response

My concerns with Karen Calvano stating "DRI has several resorts in TX, LA, and NM" is that when we asked her to show us the properties she said, "Oh we can't do that right now, but we can do that later." After 6 hours of being with her, we were exhausted and never did see the properties.

We explained that we are owners with Marriott and members of Interval International already, so affiliate properties through DRI really don't help us. Plus, the value of your affiliate properties is ridiculous. How does this help us?

What's telling is that the consumer never even heard back from Mt. Clements personally, nor from ARDA as an organization. As a matter of fact, there are close to 100 complaints that I know of personally that have been sent to ARDA and have not been acknowledged, much less addressed

Let me be clear, this is not merely a DRI issue. It's s much larger one. If there is indeed an ARDA code of Ethics and if indeed issues and concerns are brought to the Committee's attention but ignored, what's the point?

As always, constructive comments are welcome.

Thursday, July 13, 2017

Guest Post-Timeshare Thoughts

Some great insights here. Thoughts?

What I have started to think when it comes to timeshare ownership and the future of the industry...

Everyone knows this industry is not well regulated (but obviously needs to be).  Some of the actions and activities of individuals and companies that gets reported in the timeshare world would result in major fines and possibly prison sentences in other better regulated industries.

It appears the industry has long depended on being "self regulating."  It has not done a great job of that but it seems there have always been just enough legit companies that seem to try and deliver a quality product and quality customer experience at the same time they balance trying to make a healthy profit.

I think of a brand like Disney first and foremost.  Also while I know a company like Marriott has their critics, in all my years traveling and staying at their hotel and timeshare properties I always got the impression they were serious about fulfilling their fiduciary responsibilities and providing top shelf customer service and a quality customer experience.  I am sure there are other good examples.

In the past the bad eggs of the industry (the industry's worst examples) seemed to mostly be of the smaller, regional variety.  The negative impact was always minimal and able to be managed before it metastasized.   But the potential problem as I see it is that in the last decade plus, it appears what may be described as large predatory financial engineering companies almost "posing" as timeshare companies have risen and aggressively worked every loophole and non regulation to their own advantage and now are probably guilty of gross violations of their fiduciary responsibility to their customers / owners.  These companies have created vast fortunes for a very small network of individuals at the top of the pyramid.

Ironically though, and looking at historical examples from other industries, it is these very companies likely to bring the whole industry into the national spotlight and to its knees eventually.  Some of these appear to have walked to the edge of doing that already.

As these quasi financial engineering / timesharing companies become increasingly more brazen in chasing profits by any means possible, raising fees rapidly at the same time they are reducing owner benefits, due to their increased sheer size the public outcry will likely increase and just the odds of random probability suggests there will be a gotcha moment or event that will bring increased scrutiny and increased legislation.

If the good timeshare companies try to ignore what the bad ones are doing, they may find someday that their systems and profits and share prices are negatively impacted by the future regulations forced on the industry from the egregious actions of the bad actors in their industry.

Pharma for example is still dealing with the Turing Pharmaceuticals fallout even now 2 years later, and that fallout will likely not dissipate anytime soon.

This is just my still forming hypothesis.  We'll see.

Thursday, May 25, 2017

Stop With The Spin.Just Stop


Lately, there's been some truly laughable advice about timeshares; buying, owning and selling that certain people and certain organizations have been able to get through to the media.

I'm tired of this, so here's my thoughts:

1) ARDA-ROC has positioned itself as 'an alliance of over one million timeshare owners.’

It's not really 'an alliance of over one million timeshare owners' when not a single one of them votes, advises or even participates in anything that they do.

2) Timeshare is a usage product and not something that should be purchased as an investment, but rather as something you buy to save money on vacations.

True on the first two points. Usually false on the third. If you buy a timeshare from the developer then add maintenance fees, reservation fees, usage fees, etc., the average person does not save money.

Usage or not, any purchase for $20K should have some residual value after 5 or 10 years, assuming it's been maintained. Not so with timeshare. Listings abound for $100 or less.

3) You should call your resort to see if they have a take back program

Hysterical. Why a take back program and not a buyback program?  Go ahead, call and let me know what you find out. I have close to 1,600 emails from owners who want out.

4) Work with a broker

Another funny. Did you know that there's at least one major developer whose product will not be handled by any of the brokers in the LTRBA?  Did you also know that the residual value of the majority of the timeshares for sale is so low that if a broker were able to sell it, the original owner would end up paying money for the privilege of getting rid of it?  Doubt me?  Check Sharket.com

5) It's the 'mom and pop drive-inn on the Jersey Shore that have little to no value.'

None of the 1,600 emails I gave from owners wanting out own at a one of those resorts. They own at Bluegreen, Wyndham, Festiva and Diamond for the most part. There's hundreds more who are members of FB groups. Oh, and although they're geographically close, you may want to check out The Manhattan Club saga.

6) Don't list it for $1

GOLDEN. This comes from a spokesperson for an online listing platform that charges both a membership fee and a listing fee that has thousands of listings for $1. This is also the same platform that willingly takes listings from Diamond properties when they know that Diamond does not allow listings in third party platforms and will take punitive action if they are caught.

What does all this mean?

You had better be very careful who you trust with your money and your decisions concerning buying, using and selling timeshare. Question everything. Trust no one blindly. Verify everything. Don't believe something just because it was on the Internet.

Most of all, follow the money.

 

Monday, May 15, 2017

71%!

Last week, the American Resort Development Association released "Shifting Historic Industry Perception with Owner Data" in which they, along with the ARDA International Foundation, attempted to clear up 6 myths.

It was "myth 6" that caught my eye:

Myth #6: All timeshare owners disliked the buying experience.
Fact: More than seven out of 10 recent purchasers (71%) found their buying experience to be excellent or good.

Now, I don't know what "recent" means, nor do I know if the people surveyed purchased at a resort or on the secondary market.

However, I do know that the overwhelming percentage of timeshare complaints that I receive on a daily basis have to do with the buying experience a/k/a the sales pitch.

So, let's hear from you, my readers.  Agree, disagree with these findings?  Feel free to divulge as much information as you'd like.

Monday, May 8, 2017

The Case Against Timeshare Points

Timeshare points.

I used to like them. Back in 2001, I worked for the first resort in the Orlando area to convert from RCI weeks to RCI points.

So many things to do with points. So much more you could get with your points than with weeks. So much more flexibility.

Flash forward to 2017-in addition to RCI Points, nearly every brand name timeshare has instituted their version of points and in good conscience, I no longer recommend points of any kind.

Here are just a few of the many reasons I prefer timeshare weeks over timeshare points:

1-Inflation. A week is 7 days. It is now and it will be in 60 years. Not so with points. Your yearly allocation of points may get you a week in a resort this year. Next year, it may be 6 nights. 60 years down the road, who knows. There is no hedge against point devaluation and you, the owner have no control.

2-Continual Upselling. In order to counter the above, owners are continually told they need to buy more. And more. And more. I'm sorry, if your new car continually had to 'upgraded' each year because it wouldn't drive on new roads, no one would let this happen. Yet, this is precisely what is happening. The timeshare you purchased in order to accomplish good vacation accommodations, no longer does that.

3-Confusion and Lying. If I had a dollar for every time someone called or wrote saying that they had been told that the weeks system was going away and if they didn't convert, usually for upwards of $7,000, they'd no longer be able to exchange their timeshare, I'd be a wealthy woman. Just not true. Add to that the number of salespeople who don't really know about points, but desperately try to convince consumers of their 'magical powers' and you've got a mess.

4-Where's The Asset. A timeshare week is generally backed with real estate. Not so with most point systems. You're buying air. And oftentimes charged closing costs and other real estate based fees when you own no real estate. Frankly, why should you pay maintenance fees? You don't own any part of the property.

5-Sold Out Status. A timeshare with 100 units can have 50,000 owners, assuming each unit can be sold 50 times. Try to do that math with points. Try to find anyone who gives you the straight answer to 'how many total points is this property allocated?'

Are there exceptions?  Possibly.  But in general, I find timeshare points to be a poor alternative to timeshare weeks.

As always, I value your input.
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Thursday, April 20, 2017

Big Changes

As most of you know, I started Timeshare Insights and the blog “The Word From The Timeshare Crusader” with one goal:  to be a catalyst for positive change within the timeshare industry.

I’m pleased to say that I’ve helped a lot of timeshare owners and prospective timeshare owners.  While I’ve garnered some terrific media coverage from such outlets as CNBC, The Chicago Tribune, Senior.com and WGN-TV, it’s not about the media coverage, it was always about helping consumers and attempting to move the timeshare industry forward despite its stubborn intentions to stay stuck in the 1970s.

Today, in 2017 consumers are being ripped off in record numbers, there’s a never ending array of so-called “experts” who are hawking their latest company designed to prey upon unsuspecting timeshare owners and the industry has taken little or no steps to change an outdated marketing and sales structure which continues to foster a sense of distrust with consumers.

Despite that, I believe that timeshare has great potential.

So, it’s time for some changes.

Effective Tuesday, April 25th, Timeshare Insights will change to a new company.  I’ll have more information on their important services to assist the timeshare owner on my new blog.

Simultaneously, The Word From The Timeshare Crusader will be redesigned and relaunched as The Timeshare Crusader Blog and can be accessed directly on http://www.thetimesharecrusader.com and on Twitter at @TheTSCrusader.  It will have more news, more guest bloggers, more features and will of course; maintain my own independent voice as the main blogger.

I continue to tweet at @LisaLooksAt and will remain as the timeshare contributor at Senior.com.

Additionally, I continue my important work with the National Timeshare Owners Association which is celebrating 20 years of educating, advocating and encouraging responsible timeshare management and ownership.  Check them out at http://www.ntoassoc.com.

In conclusion for today:  If you like what I’ve been doing for the past 12 years or so, stay tuned, it’s going to get better and more positive changes are just around the corner.  If you don’t like what I’ve been doing for the past 12 years or so, here’s a quote from Star Wars to get you thinking; “You can't win, Darth. If you strike me down, I shall become more powerful than you could possibly imagine.”

Wednesday, April 5, 2017

Underhanded? You Ain't Seen Underhanded Until Now

I've been advising prospective timeshare purchasers for a LONG time on the questions that they need to ask before jumping in.

Those questions involve such things as:

*  what is the five year history of the annual maintenance fees
*  how sold out is the development
*  how is the HOA structured

Now however, I find out that there is another question that needs to be asked.  This question is so unexpected that I admit that I was shocked.

Here it is:

"If I purchase this timeshare, am I waiving my rights to enter into a Class Action lawsuit against the developer?"

Yes, you read that right.  It seems that a certain timeshare developer includes that somewhere in the morass of 974+ pages of documents that no one (other than themselves) ever reads.

How underhanded do you have to be to know how underhanded your business practices are and prohibit owners from suing you in a Class Action lawsuit?

It's a new low as far as I'm concerned.

Friday, March 31, 2017

Weeks, Points and Remaining Timeshare Inventory

If you're thinking of purchasing a house in a development, it's quite simple to figure out how sold out they are,

If you're thinking of purchasing a week-based timeshare, it's a bit more difficult to figure it out, but it can be done.  Find out how many units there are, multiply by 50 (leaving two weeks per year for maintenance) to find out how many total weeks there are, and then either ask the question or get the information from the county.

Not so with point-based timeshare.  How do you get the total number of points that have been allocated to a project?  I can pretty much guarantee that your salesperson has no clue.  It's not real estate, so the county records won't have it.

There are small resorts that I am quite familiar with in the Orlando area that have been in actives sales for years and years...what are they selling?

It's imperative for prospective owners to know how sold out any resort is.  Why?  It affects how and when control reverts back to the owners or the HOA.  It affects the legality of selling something that may or may not exist.  It affects the owners' ability to use what they paid for.

Do you know how sold out your resort is?  Did you ask before buying?  How did you verify the information?  Can you verify the information?

We want to hear your experiences.  Call your resort and ask the question.  We'll print all your responses.

Friday, March 24, 2017

What Is ARDA-ROC?

Some timeshare owners are still not familiar with ARDA-ROC and may be unknowingly making voluntary contributions each year through your annual fees accessed by your resort.

I'm not here to tell you if you should continue to make contributions or not...that's up to you.

You can read all about ARDA-ROC here:  http://www.ardaroc.org/roc/home.aspx

You should also read this from Irene Parker writing for Inside Timeshare:

http://insidetimeshare.com/friday-letter-america/

Irene kindly credits me with providing some information.  This information is not my opinion...this information was easily found online.

Personally, I invite Mr. Thomassen, listed as the sole "Owner Representative" on the board to contribute a Guest Post.

The more we know, the more we can grow.


Tuesday, March 21, 2017

A Timeshare Collector Speaks

Here's a guest blog that you'll find interesting.  A view from the other side so to speak:

http://insidetimeshare.com/timeshare-hoa-collections-agent-shares-experience/

Manhattan Club Update

Important update on the ongoing Manhattan Club issues:


In the upcoming hearing on 3/31, Judge Rakower' Court Room in NYC, the TMC defendants' motion seeks release of monies from frozen accounts to pay legal fees.  They are also seeking to use maintenance fees from TMC owners to pay their legal fees.

 

Item #10 Schedule B on the new 2018 TMC budget provides for $2.6 million for administrative costs and this include legal fees.  However, the Timeshare Association is not a defendant in the NYAG's case.  We need a more detailed breakdown of the $2.6 million.    It's vague and ambiguous. We need to see a breakdown.  For all we know they could be budgeting for legal fees.

 

It is also important to note that they are also budgeting $7,000,000 for a reserve for bad debts! Guess who pays that!  The unit owners are subsidizing the consequences of  sponsor malfeasance.

Wednesday, February 22, 2017

5 Myths About Timeshare

Whether you own a timeshare, are thinking of purchasing a timeshare, used to own timeshare or find yourself in front of a timeshare salesperson, you're bound to come across some timeshare myths.  Here are the Top 5 I run into:

1)  Timeshare is a less costly vacation alternative to renting hotels.

In rare cases and when purchasing on the secondary market, this may be true.  For the majority of owners, you'll be paying more when you factor in the purchase price, annual fees and exchange/usage fees.  That's not necessarily a bad thing.

2)  Real estate based timeshare is an investment and will appreciate in value.

NO, NO, NO, NO.  A million times no,

3)  You can hire a company to get you "out" of your timeshare because the sales presentation took more than the agreed to 90 minutes.

The length of the sales presentation has nothing to do with the legality or enforceability of the contract.

4)  Brand name timeshares are better than others.

"Better" for who?  Based on what?  Each person has different needs.  Don't fall for generalizations.

I've purposely left off Number 5 on this list.  What's the biggest timeshare myth you've encountered?

Tuesday, February 7, 2017

Manhattan Club News

Some of you are aware of the ongoing nasty business at The Manhattan Club.

If you're not, I urge you to do some research; it will serve as a cautionary tale and spur you to pay more attention to what is going on at your resort.

For those of you who are affected, here's some important information:


Court:   New York Civil Supreme

Index Number:  654023/2015

Case Name:        BARNETT, GLENN E vs. EICHNER, IAN BRUCE

Case Type:          Cd-Econtract

Track:    Complex

This is Class Action so will include all owners. Mr. Wasser's group is separate. People don't Have to join Class Action.

This is a separate action from the one that Mr. Wasser is handling.

Owners should continue to contact NYAG's office.

Additionally:


TMC has new counsel—that is why the early February hearing on unfreezing legal fees was postponed until 3/31. new firm, Gibson Dunn .. and the bad news: http://www.gibsondunn.com/lawyers/rmastro;

He is a NYC mover and shaker, and a very expensive lawyer and law firm. It is costing TMC/Urban a ton. This is the law firm that represented the State of New Jersey/Gov. Christie in the Bridgegate case.

Everyone should make sure they have written to the judge objecting to this; and (2) maybe getting some people to the argument on 3/31 even if it might be postponed again. This is a big hearing—if the judge allows TMC’s/Urban’s motion, they may be allowed to be paid legal fees out of owner maintenance fees. In previous briefs filed with the court, TMC has already argued that its legal fees for all defendants are running $50K-$100K/month. Once the discovery gets going, it will cost even more.
Write to:


Honorable Justice Eileen Rakower,
Supreme Court of the State of New York 
71 Thomas St.
Part 15
New York, New York 10013

Questions?

Guest Post-Fake News and Timeshare

Today's Guest Post is from attorney Michael Finn.  As always, respectful comments are welcome.


Whatever your political affiliation, you’ve probably heard of – and groaned at – the idea of “fake news.” It was the political buzzword of 2016, and it doesn’t seem to be going anywhere in the months ahead.

For anyone wondering what we’re talking about, here’s a handy primer on the “fake news” phenomenon from Vox.com. The gist of the issue is that many, many parties are taking made-up stories and presenting them as if they are from real, viable sources. While this act isn’t necessarily new, its prevalence and impact have been magnified by social media, and it’s become a huge talking point on both sides of the aisle.

The rise of “fake news” is a confounding legal, political, technological, and ethical question – and it strikes a chord with many of the stories we’ve heard from timeshare consumers over the years.

So, what do “fake news” and the shared vacation industry have to do with one another?

Like the fake news phenomenon, the timeshare hard sell is all about telling consumers what they want to hear: Easy, lifetime vacations! Flawless resorts! Easy to exchange or resell! Pass the value down to your kids!

In reality, it’s easy to debunk many of these claims, from the notion of the points-based timeshare as a real estate investment (a largely false marketing gimmick) to the efficacy of the secondary timeshare market (which is actually all but non-existent, largely due to suppressive actions on the part of major resort developers).

And, what’s more, these bold claims are given a certain level of protection. Just as the wild stories disseminated around the internet are given leeway by the anonymity of their authors and the undiscriminating algorithms of your Google search page or Facebook feed, so are the big, often dubious claims of timeshare developers protected by what Michael Finn has dubbed the “salesman’s license to lie clause.”

We’ve written about the “license to lie” clause repeatedly. In a nutshell, we’re referring to a common clause included in the mountain of paperwork executed at closing that states that the purchaser did not rely on any oral representations when making their purchasing decision.

In many ways, this clause frees up unethical salespeople to say whatever they have to in order to close the deal that day, potentially leading to situations in which a consumer signs up for something on paper that may well be diametrically different from what they were promised in the room. And given that the statutory protections for consumers – we’re speaking here of state-mandated rescission periods and the release of a Prospectus/Public Offering Statement (POS) – are largely inadequate to suit the needs of the average modern consumer, many are left “stuck” with a lifelong financial obligation and very little recourse for dispute. In other words, once the damage of misinformation is done, its effects could last for a long, long time.

As mentioned above, the timeshare aftermarket generally takes place on the fringes of the industry, outside of the direct purview of the major resort developers (who have publicly stated that they see a healthy secondary market as a threat to their bottom lines, and have behaved accordingly). So consumers looking for relief must often wander into some of the murkiest back corners of the internet, where misinformation reigns and scammers run rampant, and every claim seems too good to be true because it likely is.

The key to successfully navigating the timeshare market – before, during, and after your sale – is, indeed, quite the same as separating real news from fake. Always do your research!

Don’t be afraid to consult with a real estate or legal professional with any questions or concerns at any step along the way, and be sure to thoroughly vet any developers, resellers, exchange companies, or any other groups you may come up against in your timeshare journey with the help of the BBB and consumer protection agencies for your state.

Wherever it may be coming from, the best defense against misinformation and exploitation is knowledge and expertise

Friday, January 27, 2017

Transparancy and Accountability

I rarely, if ever, reprint a Press Release from a timeshare developer.  This one caught my eye.
DRI is now embarking on a new program where transparency and accountability are front and center.
Read on:
LAS VEGAS, NV (January 24, 2017) — Diamond Resorts International® (“Diamond Resorts”), a global leader in the hospitality and vacation ownership industries, has announced the launch of Diamond Clarity™, a new national program designed to transform the customer experience for current and prospective Diamond Resorts members. Diamond Clarity™ consists of a series of operational procedures and enhancements, new training and compliance procedures and protocols, and other customer-friendly changes to the sales process.
“At Diamond Resorts, we already excel in customer satisfaction, but we are constantly looking for ways to do even better,” said Michael Flaskey, Chief Operating Officer, Diamond Resorts International®. “Through Diamond Clarity™, Diamond Resorts will not just make a lasting impression, it will make the right first impression. It will increase transparency for the consumer and accountability for our team members, setting a new standard in our industry.”
Introducing Diamond Clarity™
Diamond Clarity™ formalizes a series of new and existing consumer protocols that define how the company engages with current and future members during the sales and documentation process. It is built on two core principles: transparency and accountability, and it begins with a simple PROMISE.
Diamond PROMISE memorializes a series of operational procedures and enhancements in a single document that will be provided to all customers at the beginning of every sales presentation. Knowing their rights, and knowing what Diamond Resorts representatives will and will not do throughout the sales process gives existing and potential members better control of the decision-making process. With this clear, concise and consistent information, consumers can easily determine whether the Diamond Resorts hospitality experience is the right decision for them and their families.
In addition to Diamond PROMISE, the company will roll out four key operational changes across its entire national platform in the near future:
  • Recording Quality Assurance sessions, subject to consent from purchasers, to review compliance with all policies and procedures, and to augment and enhance the company’s sales and quality assurance training.
  • Creating a Consumer Advocacy Channel within the company’s corporate headquarters, to quickly address any issues or concerns members may have. This new platform will allow Diamond Resorts to maintain the highest standards of service in the industry.
  • Increased training of frontline personnel. All sales and marketing personnel will take part in quarterly training exercises to reinforce their awareness, understanding, and compliance with all sales and marketing rules, principles, and practices.
  • Regularly placing “Consumer Engagement Observers” at sales presentations to continuously provide the sales organization with feedback necessary to achieve constant improvement.
“The Diamond Clarity™ program is revolutionary in its simplicity,” said Mr. Flaskey. “A lot of its program elements are things we already are doing and have done for a long time. However, by combining them with new operational reforms and making the entire package more accessible to the consumer, and by applying it practically and prominently in all of our sales and marketing efforts, we are doubling down on our promise to put our members first. With the launch of Diamond Clarity™ we are continuing to improve industry best practices.”
Diamond Clarity™ seeks to build on Diamond Resorts’ already impressive standing with its members. Almost 70% of the company’s sales are to existing members seeking to increase their Diamond Resorts vacation memberships.
So, DRI members, what do you think?  Non-DRI members, would this factor in your purchasing decision?
 

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.