Guest Post From Don Eastvold

Today’s Guest Post is reprinted with the permission of its author Don Eastvold. Don is a member of CVOA and a LinkedIn connection of mine.  

I’ve written about the need for the timeshare industry to adapt and to face the often harsh reality of consumer sentiment before its being able to truly thrive and grow. Whitewashing, covering up and name changes won’t suffice. 

Let’s hope that those in charge of the timeshare industry pay attention to voices like Don’s and mine as we enter a new decade.

I've had the privilege of spending over half my life enjoying the many benefits of this magnificent industry, which with great pride, we once called "Timeshare". However, through an evolutionary process, developers refrained from using this adversarial word "Timeshare" but continue to use the same methods of marketing and sales, which are the very essence of what created the stigmatization of our industry.   

Behind all their denials, developers wrapped and rewrapped their "timeshare" as a Vacation Club in the '80s and '90s, Travel Club, for the new millennium, and are currently settling in on Loyalty Club or Discount Club. 

Yes, in our futile effort to repackage our industry we continue to avoid changing the very three factors we initiated, and that continue to stigmatize our industry today; 

1.    The overly aggressive OPC style marketing methods

2.    The sales techniques of fictitious first-day incentives, deceptive drops, and questionable product add-ons 

3.    Policies that force new members to jump through multiple hoops to cancel    

With the advent of the Internet and the extensive use of Social Media, we can no longer stick our heads in the ground and pray the grievances will subside or go away. Once a complaint is posted on the Internet, it's there to stay and multiply. The success or failure of the Club now depends on the Tweets, TripAdvisor comments, Facebook postings, and search engine inquiries. The Club Product, initially branded with great pride, will surely die a slow death by Social Media if we continue to turn a blind eye and use the same old methods of marketing, sales, and cancellation policies.   

 Proactive vs Reactive Social Media Culture

With the available technology and the ever-increasing influence of Social Media, it is time for our industry to discontinue using these traditional "timeshare" tactics. A Proactive Social Media culture can be created by first developing a viable club product that is backed 100% by the developer, politically, economically, and ethically. It requires an immediate change of the developer's short-term "bottom-line" mentality, replaced by a long-term "service-oriented" culture. It starts at the very top of the corporate ladder and flows down to every department, including sales, marketing, and yes, the company's cancellation policies.  

The first step is the establishment of goals, strategies, and policies based on service first and the accountant's required bottom-line a distant second. 

The next step is to implement this new corporate vision by using available technology that facilitates the creation of a service-oriented marketing team, complemented by a sales team using well-defined content that presents the club product offered to the consumer. 

No more aggressive OPC tactics or confusing yellow pad/tablet presentations made at the discretion of the salesperson. And yes, if the new member wishes to cancel, try to resell them but let them out without jumping through multiple hoops. Attempting to meet the accountant's desired bottom-line will only result in the use of aggressive marketing methods and questionable sales tactics that will cost the developer far more in the long run. 

Moreover, the few thousand dollars retained from members who want to cancel will cost the developer far more in Negative Social Media Currency.  

The net result of putting service first and the bottom-line second immediately opens the path for the creation of a Proactive Social Media culture. It sets the stage that promotes guests and members alike to express to the world their positive experience with the Club. 

By eliminating the traditional sales and marketing methods, we remove the causes of the "Reactive" social media approach, which is a never-ending battle fighting the snowball effect of negative postings on the Internet. 

By changing from a "bottom-line" to a "service-orient" business philosophy and creating a "Proactive" Social Media culture, the developer will discover that their desired "production" goes up in the long-term. The bottom-line results are the "Cost of Sale" goes down, consumer complaints go down, the cancellation factor goes down, and the Club's VPG and the closing percentage goes up along with profits. Most important is the Club is generating happy new members wanting to share the benefits of their new Club with family and friends and demonstrate so by posting positive social media testimonials, photos, and videos. No longer will you have to "React" to the loss of clients or new members canceling because of negative postings found in their "Google Search" before, during, and after a sale.  

Internally a "Proactive” Social Media culture will also create loyal marketing, sales, and operations teams. They quickly learn that the old tactics of making a "quick dollar" abusing clients, making false promises and mistreating members offer far less of a return than the long-term commitment of generating happy guests and members through service, service and more service. The developer's fear of losing the marketing and sales staff with such changes is an absolute falsehood. The best people in our industry have an innate desire to learn more and to evolve with the new technology and new trends. They, too, desire new members that they can look in the eye a year later and see a warm smile and receive a genuine thank you for introducing them to the Club.  

The Final Solution

The door is wide open to this path of needed change, which replaces the traditional methods of sales and marketing that continue to stigmatize our industry. It doesn't come free, and it requires a full commitment from the developer to provide a new corporate vision that includes a viable Club product, on-going training, use of current technology and a service-oriented marketing program. Such a commitment will result in a Proactive Social Media culture that will pay off far more than the current path of a Reactive Social Media culture.  

So ask yourself a simple question,  "Do you want to re-brand your Club every few years with each death by Social Media, or do you want a new generation Club that can be marketed, sold, and serviced with great pride for years to come?" 

If it walks like a duck, quacks like a duck, it's a duck, not the New Generation Club.  

Why Protect Only Some Timeshare Owners?

The timeshare industry’s newest program designed to make it look as if they’re caring companies looking out for all their owners is a handful, OK about 16, of developers offering a deed back program. Often times, these programs cost the owner upwards of $1,000, making them no different than the glut of self-proclaimed exit companies in my opinion, but that’s a topic for another post. 

These developers are quick to point out that they want to stop their owners from the damage that these exit companies do. Don’t get me wrong, these exit companies are no good and do much damage to the owner looking to get out, the remaining owners at the resort and to the resort itself, which may find itself in a precarious situation due to unpaid maintenance fees on thousands of intervals. 

But here’s where the myth of helping owners can’t stand up to the spotlight of truth. The majority of these deed back programs can not be used, even with paying the draconian fee, unless the interval was purchased directly from the developer. 

So, are we to understand that these benevolent developers only care about protecting SOME of their owners?  It’s no wonder so many frustrated and beleaguered owners are turning to these exit or transfer companies. After all, these scam companies promise help for all owners, something the myopic developers have yet to grasp. 

Who Oversees Timeshare Inventory?

I often hear from frustrated timeshare owners claiming they are unable to secure a reservation for either their home resort or an exchange resort but easily find a booking available on a rental site. 

It’s true that there’s two separate pools of inventory at a resort; sold and unsold. In theory, sold inventory is made available to owners and exchangers according to the reservation rules pertaining to individual ownership. Unsold inventory, that is inventory that is owned by the resort, can be used for whatever the developer chooses. Oftentimes this inventory is advertised at a rate lower than the comparable maintenance fee in an attempt to bribe, er I mean entice consumers in for a sales pitch. 

The key phrase in that last paragraph is “in theory”, as I defy anyone to be able to prove what happens to any one specific piece of inventory. Think about it...a single timeshare unit can have up to 50 individual owners (assuming the resort is doing the right thing and reserving 2 weeks for rehab and maintenance). Things get even murkier if the resort is point based, where ownership is more akin to a membership. How is any of this being tracked?  Is it being tracked at all?  

Or have millions of timeshare owners blindly put their trust and their money into a system that has absolutely no oversight and that can be manipulated as the developers see fit?

If you’re in the industry, I welcome your thoughts. 

Can It Get More Deceptive?

It’s almost impossible to believe that this level of deception took place during one sales pitch. However, I have no reason to doubt the authenticity of this saga. 

I’ve redacted the name of the developer in question for purely selfish reasons. I have no interest in receiving a subpoena and this developer has a history of attempting to make things miserable for those individuals who threaten to uncover some of the less consumer friendly practices they routinely employ. They’re a real “gem.”

I purchased "points" with REDACTED the end of August when celebrating a friend's birthday weekend. I was provided misleading and false information by the sales representative into the inducement of purchasing. 

She advised 30,000 points was equivalent to 60,000 points as the value doubles in the first 4 months of the year and that 30,000 points could be transferred to $9,000 to cover the yearly maintenance fees and still have leftover for vacation. My friend was with me at the time and asked over and over specifically about this because it seemed as if we'd then be making money on the points. Melinda, the sales rep, assured us this was true. She also advised I could sell weeks to friends or family to add to the value. 

Lo and behold I've found out almost everything she stated was a lie. It's been 3 months and I've been trying to get out. I paid nearly in full, my entire savings, of $60,000. I'm a single mother to three small children and was not expecting to have to pay maintenance fees as the points were to cover this as I was promised. 

I've now taken out credit against myself to pay an attorney to get me out. I tried to resolve with REDACTED stating I just wanted to give it back and I'll take a hit on the $60k I paid out of pocket just to be free. They were unwilling, despite that it's only been three months and nothing has been used. I'm desperately hoping my attorney will prevail as I don't have the funds to cover the $6,000 in maintenance fees they would be drafting January. It is not what I was promised or told. 

Also, my friend whom was with me was somehow added to my account even though he never signed any paperwork or has relation to me. And REDACTED is attempting to have the responsibility fall on BOTH of us when he never touched a paper or had any dealing with their shady tablet closings. His name is nowhere on the "title". If this doesn't go through I'm hoping not to be forced into foreclosure. As a single mother I regret entirely ever stepping foot into the REDACTED sales presentation. Lesson learned.

While this experience is disgraceful, I’m particularly angered by the fact that the developer refuses to take back the timeshare, despite the fact they have $60,000 in cash. The CEO of this developer is fond of touting the “fact” that they are part of ARDA’s Responsible Exit coalition. Several misinformed media sources parrot what this CEO says, without so much as a follow up question. One reporter was “surprised” when I informed her that this developer charged $1,000 per contract to get out. It seems the CEO neglected to mention that in his attempt to get out his narrative. 

Instances like this clearly illustrate the need for more comprehensive timeshare reform. A 24-hour cooling off period, as some are calling for, would do nothing to prevent these sales tactics. 

Guest Post-DelRay South Shore Club Needs Help

Delray South Shore Club, a timeshare condominium chartered in 1981, is one of the only beachfront properties left available for the average person as an economical vacation on the east coast of Florida. 2019 has seen a concentrated effort by speculators to sell this property to a developer despite the owners wishes to remain a timeshare resort.

In 2017 the BOD solicited, then received, an owners vote to continue as a timeshare. The scheme to sell the property began after this vote according to investigations by concerned owners.

A long time owner used many methods, including outright fraud to manipulate the BOD and Owners into consenting to terminate the timeshare and sell the beachfront property to developers. 

There is proof and the search of public records, real estate transactions, BOD meeting minutes and media reports reveal a paper trail. There is documentation of the intent to use the legal system, State Agencies and relationships with public officials and developers to obtain this property for their own enrichment. 

The Florida Condo/Timeshare Compliance Division was used by an owner over 20 times to initiate State compliance investigations and paperwork for the Association. In addition, this Owner sued the BOD for information not available to other owners for information on foreclosures and delinquents. This same Owner and an associate were elected to the BOD with questionably fraudulent resumes.

Unsolicited offers for purchase of the property were tendered with the BOD and Owners were not notified for three (3) months.  

Four out of seven BOD purchased auctioned weeks without timely notification to Owners. BOD members also purchased foreclosed intervals, weeks the Owners paid to have legally foreclosed on, from DSSC on information not shared with Owners for $10 to $500 each week.

The resort was sabotaged twice costing the Association over $20,00 in repairs.

This was reported to the Delray Police with the resort manager stating that he believed this occurred because a developer wanted to buy the property. 

Another survey was sent out by the DSSC attorney asking if the Owners wanted to sell with the count still in favor of keeping the resort.

The BOD has a full list of Owners and sends out missives while owners cannot communicate. The BOD consistently failed to make needed renovations and repairs to the property despite Owners payment of required assessments and maintenance fees.

Despite the Owners expressed wishes to remain a timeshare resort the BOD sent out a proxy vote to all owners regarding the termination of the timeshare and sale of the property. The ‘ballot’ cited renovation/repairs in excess of 1.5 mil not based on any contractor quotes. The ballot was confusing with owners having many questions not answered by the BOD. The DSSC attorney, citing a 92% compliance rate stated, an overwhelming consent vote to terminate and sell. The proxy was not sent as required by Florida Law and there is over 5%, actually 12%, of the Owners that do not want to sell

The BOD is now in a ‘trustee’ position. Nothing is being repaired and the Annual Owners Meeting and Elections required by Association bylaws has been cancelled. 

This property will be sold at below market value to developers that will bulldoze the resort and build multi-level beachfront condos for the wealthy, $5-10 million each.

The BOD was not honest and did not fulfill their fuduciary responsibility to Owners, a legally binding responsibility. The BOD misinformed, failed to inform and used outright disinformation to obtain the result they wanted, the termination of the timeshare and sale of the property to their own benefit. The BOD engaged in self dealing to enhance their financial windfall at their own direction.

Four of the Owners have initiated a lawsuit to stop the sale of the property. The suit asks the court to have the BOD return the fraudulently purchased intervals, toss the flawed proxy vote, order continued operations as a condo association for regular people to vacation until settlement of the suit. The court is asked to require the property to be placed on the open market for a fair bid with detailed information for the Owners to decide to sell or stay. 

These developers have money and connections while we ‘regular people’ from all over the country cannot even communicate the real facts nor request support.

Want to know more? See the website at https://bit.ly/delrayssc

To help us fight big real estate money contribute to the legal fund at https://www.gofundme.com/save-south-shore

e-mail with comments:

transparencyssc@gmail.com

Here’s Another Consumer Crying Foul

This is an actual post/complaint which clearly illustrates the fact that some, perhaps too many, consumers are abdicating their responsibility when it comes to timeshare matters. I have redacted the developer’s name because it’s not about them; it’s about the consumer. 

The sales person kept me for about 4 hours and lied to me about the value of the shares and he also said I can cancel it any time and there is nothing to lose (all Lies) to make me buy the package.

The value of the shares were almost 1/10 of what he told me and I have not been able to cancel it either. It is impossible until after the whole price is paid.

He told me I don't need to read the manual because it's boring and he has told me what I need to know, but he hadn't and cost me $US15000 plus months of stress and sleepless nights.

I can't ever forgive them. Don't bother buying these shares, they are only working for their own benefits not yours.

I am having a hard time finding any empathy for consumers who allow themselves to be put in these situations. There are serious problems that need to be addressed in the industry. Addressing this just wastes time and energy. 

4 Ways To Avoid Timeshare Buyer’s Remorse

Do you understand the differences, both legally and usage wise between fixed week, floating week, points, deeded, right to use and deeded in trust?

Is it still affordable if your finances change?

Do you understand how the internal and external exchange program(s) work should you decide to visit somewhere other than where you purchase/own?

Did you purchase for any other reason other than securing vacation accommodations?

In addition to these pointers, I’ve identified 19 must ask questions if you’re considering purchasing a timeshare. It’s a total mystery to me why people spend hours and even weeks researching and comparison shopping a couch, a mattress or even a Bluetooth speaker system but then rely on what the timeshare salesperson says during a high pressure sales presentation that they don’t even want to be on while on vacation. 

There are 9 additional questions to ask if you’re interested in purchasing a timeshare on the secondary market. Cheap timeshares are everywhere.  It’s just as easy to make unwise decisions when the timeshare is $500.  The key is to ask the right questions.

I’ve made these questions available for only $19.99. Your choice...$19.99 or a $20,000 perpetual contract.