Do you own a timeshare or vacation club membership and have unexpectedly ran into financial hardship? Before you throw caution to the wind and stop making your regular payments, we suggest you take the time to read this article about the consequences of not fulfilling your financial obligation. If you default on your regularly due payments, there are short term and long term repercussions that you should be aware of. If you don’t make your timeshare payments now, it could continue to affect your financial stability and credit status for years to come. Read below to learn about the potential consequences that could occur if you stop making your timeshare payments as required.
- Fines For Late or Missed Payments
One of the first consequences of not making your regularly due timeshare payments is that you will accrue fines and fees. These fines and fees be added on top of the regularly due monthly payment amount. While every vacation club has their own rules and regulations regarding payments, the majority will charge you fees if you stop paying. In order to verify how much you can expect to be charged, read your membership policy very carefully. Did you know that in addition to your regular timeshare payment, you also need to stay up to date with your maintenance fees as well. If your maintenance fees are not paid regularly, members love the opportunity to use their timeshare and enjoy all the great amenities and services. Anytime regular payments or maintenance fees are not paid, access to the timeshare is revoked. Another thing to consider is that if you get behind on payments, and come current later, you will also have to pay a reinstatement fee in addition to regularly due payments and late fees. As you can see, it is best to avoid defaulting on your payments in the first place.
- Potential Foreclosure
Another risk to stop paying your timeshare payments is foreclosure. Initially, a written warning will be issued, then emails and phone calls will be made to inquire about late payments. If you ignore these attempts and do not come current on your payments, the timeshare company will probably start the foreclosure process. Foreclosure of your unit will affect your ability to enjoy vacations, and will affect other areas of your life as well. For example if you own other property, it could be put at risk if a claim is filed against you. Any debt could be transferred to a collection agency and that will adversely affect your credit score. As a result, your credit score will get worse and you will have difficulty obtaining credit for future purchases. As you know, debt collectors are extremely persistent about collecting payments that are due, and you could find yourself in an embarrassing situation when friends, neighbors or co-workers realize what is happening.
- Cancellation Scam Companies Could Target You
A lesser known consequence of defaulting on your payments is that you could become an unsuspecting victim of a cancellation scam. Timeshare cancellation scam companies are fraudulent companies that take advantage of existing vacation club members by claiming they can cancel your timeshare for you. However, stay alert as it is a complete scam as no company can cancel a timeshare after the cooling-off period has passed which only lasts a few days or weeks after your contract was signed. If you pay an upfront fee to the cancellation company, you are risking additional economic stress as they will not be able to truly help you. To avoid a scam, always work directly with your existing provider, and never pay an upfront fee to a third party cancellation company.
As you can see, there are many serious consequences if you do not pay your timeshare payments on time. Stay current and fulfill your financial responsibility as the long term negative repercussions will cause you additional stress.