Timeshare Purchase Checklist!

This article will apply to both buyers and sellers of Timeshares, as the information included will be important for both sides. This however will not be a "How to sell your Timeshare" article as that has already been written and contains the information relevant to sellers, so this is intended to assist someone looking to buy a Timeshare.

Information about the Timeshare Resort

• Does the resort have any amenity awards with the Timeshare Exchange companies (Gold Crown, Interval Premier, 5*)? How long has the resort held those awards? Has award status recently been upgraded or downgraded?


• Is the resort all-inclusive? If yes, is the all-inclusive optional or mandatory? How much is the all-inclusive fee?


• Are there other mandatory fees charged (cleaning, utilities, occupancy taxes, energy surcharges)? If so, how much are these charges?


• Are any activities or amenities available free or at a reduced rate (e.g., golf, skiing, water sports, children’s programs, spa visits)? Do these rights transfer with the sale, and can I transfer them again if I sell the unit?


• Do these rights transfer with the sale, and can I transfer them again if I sell the unit?


• If the property is not deeded to a specific unit and week, what assurances are there that the developer has not or cannot sell more ownership units than the available occupancy weeks?


• Is the entire resort owned by a single timeshare operation, or is the resort ownership mixed (timeshare ownership, whole ownership, or even different timeshare programs owning different units within the same resort)


• If the resort ownership is mixed and usage is floating or must be reserved, how likely is it that you will be able to reserve a unit you want? If the units vary in amenities (such as view, quality of unit, building type, etc), how many of each type of unit does the timeshare program own? How is usage assigned among those units?


• Does the property include a hotel operation as well as a timeshare operation?


• Is the developer still selling units at the property? What percentage of the timeshare inventory has the developer currently sold?


• Does the developer dominate resort operations, or has control effectively transferred to the owners? Have there been recent changes in management companies? If so, why were the changes made?


• Has the resort or resort group recently changed affiliations with exchange companies? Is the resort dual affiliated with both RCI and II?


• Does the resort have a program to rent units on behalf of owners? What does the resort charge for renting your unit?


• What bonus time benefits are available to owners (either at the resort or within the resort group)?


• What is the financial stability of the resort? How do the annual fees compare with fees charged by other resorts in the area? Does it appear that the resort may be underfunding operations? Has the resort completed a review of the adequacy of reserves funding? If so, have the results been shared with owners, and are the results available for review?


• Does the Homeowners Association have units for sale that they have foreclosed on for non-payment of fees? How much are the selling the units for? How many units do they own?


• What is the gap between potential and actual income from owner annual fees? (Potential income is the what the resort should collect if all owners paid their assessments. Differences between potential and actual assessments indicates owner defaults.)


• For resorts located subject to recurring major weather events (such as hurricanes), what insurance is in place and what is the deductible? Does the resort have adequate reserves to cover the deductible? If a special assessment were made to cover the deductible, how much would that be per timeshare week? Is the policy limit large enough to cover reasonable costs of repairing or reconstructing the resort if it suffered extensive damage?


• Does this Resort exercise Right of First Refusal? (ROFR)? If so what is the time period for evaluating the purchase? Is there any contact information for the department that oversees the ROFR process? (what is ROFR)

Note: The answers to these questions should not be considered a dealbreaker (or vice versa) in many cases, it is just important for you to have the answers to these questions BEFORE you become an owner so you can make a proper educated decision on if this ownership is right for you!

• Is the week fixed or floating? If it’s a fixed week, is the week fixed according to week number or calendar date? Get a copy of the resort’s calendar.


• If the week is fixed, and is a holiday week (such as Week 7 for Presidents Day week in the US, Week 51 for Christmas, or Week 52 for New Years), what is your usage right in years when the holiday does not fall on the designated week?


• For floating weeks, does the resort bulk spacebank? If so, when do they do that?


• For floating weeks, how do you reserve your week with the resort? How difficult is this? Is there a booking window?


• How large are the units? What is the layout of the beds, bedrooms, and bathrooms? How many bedrooms does the property have? Does the exchange company rate the unit with the same number of bedrooms as the resort and the owner? Are any of the beds sofa beds? Are any of the beds Murphy beds?


• Is the kitchen a full kitchen or partial kitchen? If it has a full kitchen, are the appliances full-size of apartment-size?


• Can a week usage be split (e.g., into separate 3- and 4-day visits)? If so, what restrictions apply and what are the fees for splitting usage?


• Must maintenance fees be paid before reserving weeks? What are the maintenance fees? Do the fees include taxes? Obtain a history of annual fees. Find out if there have been any special assessments.


• Is the unit deeded or right-to-use? If right-to-use, how many years remain in the use period? When the use period ends, does the owner have an option to renew or does the unit revert to the resort or developer?


• Are taxes part of the annual fee, or are they billed and paid separately?


• Are there any outstanding charges or liens against the property? Have all maintenance fees and assessments been paid in full? Has the seller paid off all loans associated with the purchase? Contact the resort to be verify that developer financing loans have been paid off (estoppel letter / Title search).