Timeshares and holiday clubs

Timeshare and Holiday Clubs: A Basic Consumer’s Guide

Navigating the world of timeshares can often be complex. Whether you are looking to purchase, exchange, or exit a timeshare contract, understanding your rights is the first step toward a stress-free timeshare holiday experience. This guide provides a basic and high-level overview of some of the key characteristics and considerations for the timeshare product.

Purchasing a Timeshare - Timeshare Overview

A timeshare is a way of spending time in a holiday property for a specific period each year. When you enter a timeshare agreement, you are typically purchasing:

Fixed Week/s

Typically, the right to use a specific week(s) in a specific accommodation at a specific resort specific property

Points

A number of points linked to a home resort that allows you to trade the points for stays at other resorts. These other resorts can be inside a branded resort portfolio or with an exchange company.

You will often hear people in the timeshare industry referring to themselves as owning a Fixed Weeks or a Points-based product. This is a common industry language and product labels.

Beyond the initial purchase price, you are required to pay an annual maintenance fee or an annually recurring points fee to your resort or timeshare provider. This annual maintenance fee naturally increases, and the level of increase can vary among different resort operators. Typically, annual maintenance fee increases are in line with country inflation levels.

Key things to know when purchasing a timeshare

• The 14-Day Cooling-Off Period - Under UK and EU law, you have a 14-day window to cancel your contract for any reason without penalty.

• No Upfront Payments - It is illegal for a trader to ask for any payment (deposits, legal fees, or administration charges) during the 14-day cooling-off period.

• Information Requirements - You must be provided with a standard information contract form in your own language before signing. This documentation needs to stipulate the terms and conditions of your timeshare membership. Most resorts also issue something often described as a Resort Constitution (sometimes referred to as Articles of Membership / Ownership), and this document goes into granular detail about the specific rules of usage and conduct at the timeshare resort you have purchased. Make sure you fully read and understand all the details before committing to your timeshare purchase.

Using Your Timeshare - A Guide to Ownership

Once you have purchased a timeshare, understanding how to explore the operational side of your ownership is key to getting the most value and the best memories from your holidays.

In the UK and Europe, this involves engaging and managing your relationship with your resort or club, reading all communications and updates you receive and understanding the governance and rules of your chosen timeshare resort or club.

The Timeshare Club or Resort Operator

Most European timeshare developments are typically managed in one of two legal entity structures - designed to protect the integrity of the resort and the experience of the owners or members.

• The Resort Operator/Developer - This is the professional management company appointed to oversee and handle the day-to-day management of the club or resort. For example, their duties include on-site maintenance, staffing, security, compliance, communications, customer service and ensuring the facilities meet the standards promised in your contract.

• A Timeshare Independent Club/Resort – This is usually an independent club or resort, not operated by a management company or developer, typically operated by a Resort Manager and onsite team in conjunction with a dedicated Owners’ Committee who make the decisions on the overall operation and running of the timeshare club or resort as detailed above.

Please note that some Independent Clubs do operate under appointed management companies, and these management companies are sometimes recognisable brands.

Club/Resort Owner Committee Representatives

As a member of a timeshare club, you are not just a customer; you are part of a community. Most UK and European resorts have an Owners’ or Members’ Committee.

Owner Committee Representatives are typically fellow owners or members at your club or resort elected to represent the interests of the entire membership.

They meet regularly, often with the Resort Operator in the case of larger developer managed resorts, to review budgets, oversee how your maintenance fees are spent, and ensure the resort is being maintained to a high standard. If you have concerns about the management of your resort or concerns about your membership, the owners’ Committee is your primary point of contact.

Timeshare Exchange

Over the years, one of the most flexible ways to use your timeshare ownership is the option to exchange your week or points for a stay at a different resort. These resorts can be in many countries around the world. The resorts are what is known as ‘affiliated’ to the exchange companies’ portfolio. Exchange options can never be guaranteed and are always subject to availability.

How it works

You ‘deposit’ your week into a global exchange pool (managed by companies like RCI or Interval International) and request a stay at another club or resort. Some larger timeshare operators may offer internal exchanges between their own portfolio of resorts.

Exchange providers can charge both an annual membership fee and an exchange fee. Where free membership is offered, it can be challenging to see exchange availability. Some exchange systems often involve what is known ‘trading power’ rules. This is where the season and unit size of a week’s-based product affect the type of exchange options available to you. For example, a resort located in a popular area, with higher sleep capacity and in the main holiday season, will carry higher trading power than a small studio apartment in the off-season. Higher-demand seasons and locations may be harder to swap into, with no guarantee of achieving your desired swap. If you really want to achieve an exchange, you may need to be prepared to have multiple resort choices in your request to exchange.

For Timeshare Members who use the Points System, the members with more points have stronger trading power and are more likely to get to stay at the resorts of their preference, although this can never be guaranteed.

Timeshare Resale and Exits

Sometimes, timeshare owners need to hand back or sell their timeshare for a variety of different reasons. At this moment in time, owners looking to sell, release or exit their timeshare can be extremely vulnerable to fraudulent operators.

Most timeshare providers already have an exit programme in place, so speaking with your club or resort directly should always be the first option.

In the UK and Europe, there are two main options to explore:

• Timeshare Resale

Always try to choose a reputable or recommended resale company to list your timeshare. Most timeshares may sell for a fraction of their original purchase price on the secondary market. However, be aware that most timeshares do not increase in value and may be difficult to sell. Check your original contract for ‘transfer fees’ or ‘exit fees’ that the resort or club may charge to process the sale.

If you speak to a Timeshare Resales company, ask them to share their track record for selling timeshares similar to yours, and what they feel is the probability of selling yours and for what price. Ask them to email you their terms and conditions of selling and how you pay for their services. Read these carefully before committing to any agreement. Check that any company, exists as a legal entity and has an official company listing. If you are unsure, consider legal advice to help ensure you understand the terms and conditions provided by the Timeshare Resales company.

Always speak to your club or resort in the first instance to discuss any resale options that they have available to you before engaging with a third-party company.

• Timeshare Exit

Most ethical timeshare Clubs or Resorts have established ‘Exit Policies.’ This allows timeshare owners or members to formally hand back their week (often due to age, death of a party, financial hardship or ill health for example) to end the liability for future maintenance fees. There is no one standard exit policy across the timeshare industry. Each timeshare club or resort may have contrasting exit options, whereby terms and conditions may vary.

Always check with your resort or club directly before connecting with any third-party ‘exit’ company or being offered to be referred to a law firm to release your timeshare.

If you decide to engage with a third-party company, always conduct some research to try to ensure they are a reputable company, and never pay upfront fees. If you are in doubt or unsure, try to choose a company that is registered with the Solicitors Regulatory Authority (SRA), as they are bound by a strict code of conduct. Companies that are governed by SRA will have a clearly labelled membership number on their materials and their website. Always carefully read any contracts and terms and conditions presented to you.

Beware of Timeshare Related Scams

The timeshare industry and its owners and members are frequently targeted by fraudulent operators. Whilst there are some reputable exit and claims management companies out there, not all are legitimate. Protect yourself by recognising these common red flags:

Common Scams

• The ‘Cold Call’ Resale Scam - You receive an unsolicited call from someone claiming they have a ‘guaranteed buyer’ for your timeshare or they can assist you exit your timeshare. They will ask for an upfront fee for ‘legal costs’ or ‘taxes’ - once paid, they often disappear with no ‘formal’ exit in place.

• Recovery Fraud - Scammers often target people who have already been scammed, claiming they can get your money back for a fee.

• Bogus Law Firms – Fraudulent operators often pose as reputable lawyers offering to ‘exit’ your contract. Always verify a company through the official Law Society or regulatory body. In the UK, law firms need to be members of the Solicitors Regulatory Authority and claims management companies are governed by the Financial Conduct Authority.

UKICC Advice - Never pay any money up front to a resale or exit company promising to cancel your contract. Always contact your club or resort operator first, before engaging with any external company.

Further Support and Resources

The UKICC recommends visiting EUROC (European Resort Owners Coalition), an independent, not-for-profit timeshare trade association with a focus on consumer protection. They offer free and impartial support for timeshare members and owners.

The EUROC Timeshare Support Hub is an online support hub service and acts as a one-stop shop for essential information, addressing common queries, providing guidance on various aspects of timeshare ownership, and offering access to expert advice. Support is offered via email, online forms, telephone and WhatsApp, whichever method of communication is preferred by the person seeking assistance.

EUROC is a non-commercial entity. They will never ask for money or refer you to any specific third-party company. They will strive to help find a solution to the questions or issues you may be facing.

Website - Support Hub - EUROC Europe

Telephone - +44 (0)203 582 2345

Email – support@euroc.org