Disappointed in The Timeshare Store

[delmar411]

So if someone commits to buy and puts down earnest money, and then at 11 days they back out...aren't there *other* penalties? If I'd backed out at 11 days after we bought into DVC, there would have been penalties...is the ONLY penalty just losing the earnest money with resale?

I am having a hard time understanding in layman's language just what the earnest money is for, if there are 10 days to back out with no penalty, and then, from what my brain can come up with, at 11 days you'd OWN that property and would have to sell it on your own.

Help? In normal simple words?

For the timeshare store you'd lose your deposit, half to the seller and half to the broker, and then you'd also be responsible for covering the remaining balance of the full commission. It's right there in the contract, section 3.

3. If Buyer fails to make any payment or perform any of his obligations hereunder, Seller has the option of terminating this contract and Buyer shall forfeit the deposit and the escrow agent is authonzed by the Buyer to pay one-half of the deposit to tne Broker and tie balance to Seller, except that the Broker's portion shall not exceed the full commission Buyer agrees upon default to pay Broker full commission minus Brokers portion of the forfeited deposit.

 

[Jerry@dvcstore]

Each state passes its own laws regarding the amount of time you have after buying a timeshare property to return it for a full refund. The process of returning an unwanted timeshare shortly after purchasing is known as Timeshare Rescission, or rescinding. The timeshare rescission process refers directly to the interval of time that is legally allowed to pass before you can no longer return a timeshare contract, or change your mind about your time share purchase. The ability to return an unwanted timeshare shortly after purchasing is not something your timeshare salesperson is likely to mention (unless you ask), but it is built into every state's legal code as a protection for consumers; some people also tend to refer to this time as the "cooling off period" following the purchase.

It makes no difference if you purchased your timeshare through RCI, Wyndham, Celebrity, Disney, Fairfield, Hilton, Hyatt, Mariott, or another timeshare, the Right to Rescission is entirely dependent on the state law where the timeshare property was Purchased / Sold. Each set of documents/purchase papers accompanying a timeshare sale will include form explaining how to rescind. It will likely be titled something similar to, "Cancellation of Time Share Purchase." If you fail to comply within the window of legal rescission you would forfeit your deposit and could be sued by the seller / developer.

Timeshare Rescission Cancellation Periods if purchased in:

Alaska – 15 days
Arkansas – 5 days
Arizona – 7 days
California – 7 days
Colorado – 5 days
Connecticut – 3 days
Delaware – 3 days
Florida – 10 days
Georgia – 7 days (business)
Hawaii – 7 days
Illinois – 5 days
Indiana – 3 days (business)
Iowa – 5 days
Kentucky – 5 days (business)
Louisiana – 7 days
Maine – 10 days
Maryland – 10 days
Massachusetts – 3 days
Michigan – 5 days
Minnesota – 5 days
Mississippi – 7 days
Missouri – 7 days (business)
Montana – 7 days
Nevada – 5 days
New Hampshire – 5 days
New Jersey – 7 days
New Mexico – 7 days
New York – 7 days
North Carolina – 5 days
Ohio – 3 days
Oregon – 5 days
Pennsylvania – 5 days
Rhode Island – 5 days (business)
South Carolina – 5 days
South Dakota – 7 days
Tennessee – 10 days
Texas – 5 days
Utah – 5 days
Vermont – 3 days
Virginia – 7 days
Washington – 7 days
West Virginia – 10 days
Wisconsin – 5 days (business)

There are some state missing. I do not have the data on these other states.

 

[disneynutz]

entirely dependent on the state law where the timeshare property was Purchased / Sold.

If you buy a timeshare in Florida or Hawaii, live in another state and sign the docs in your home state. what determines were the timeshare was sold? The timeshare location, where the docs were signed and/or where the broker/agent is located?

Bill

 

[bom_noite]

It makes no difference if you purchased your timeshare through RCI, Wyndham, Celebrity, Disney, Fairfield, Hilton, Hyatt, Mariott, or another timeshare, the Right to Rescission is entirely dependent on the state law where the timeshare property was Purchased / Sold.

Jerry, I am not trying to be difficult, but, I am struggling with the entire "Florida Law Prevails". I am sure you are sick of this, but, it is a very interesting topic.

Everything I read suggests that South Carolina law prevails. States have absolute jurisdiction over the land and property within their borders (with some limited exceptions). If DVC offered a 10 day Right of Rescission and South Carolina required 20, do you think for a second that because WDW is based in Florida would mean anything to a Judge in South Carolina?

I was curious what my BCV contract states. It appears DVC may attempt to cover themselves with the following wording: This agreement shall be governed under and interpreted and enforced in accordance with the laws of the state of Florida.

I would guess that if an HHI owner looked at their contract they would see the the exact same wording.

It goes on to say (paraphrasing the legalese), if any provision of this contract is in violation or is usurped by any local law then only that one isolated point would be considered moot and the remainder of the provision (not in violation) and contract will still be considered valid.

It appears to me that the DVC Lawyers are stating that they would like to have Florida Law prevail. But, they also acknowledge that local laws can at times take precedence. And, if and when that occurs (and we are called out on it) - here is how we will handle that.

While I am not a lawyer, I have some background with contracts. From my experience the lawyers usually like to meet or exceed any individual state or national law so they can steer clear of potential lawsuits. For example: DVC was kind enough to give me a 15-day right of rescission. Why 15 if Florida only requires 10? Perhaps because some states provide 15 days.

In this case my GUESS is this: I have no doubt that SC law applies. On the other hand, the SC law insinuates that the right of rescission was constructed to protect the buyer. A 10 day right of rescission increases the protection required by SC Law. The seller was provided a contract that clearly spelled out 10 days and acknowledged that fact with a signature. No Harm - No Foul.

In my mind the question is not: Is 10 days legal or illegal. I think the question is what State Court would hear the matter. My guess is a FLA Judge would say I am not going to adjudicate a matter involving SC Statutes and throw the case out.

 

[bom_noite]

I will also point out that I read Exactly what Dean wrote regarding South Carolina Law. Based on what I read the right of rescission requirements only apply to a company involved in selling timeshares and has no applicability over resales.

The term "seller" does not include the following:

(a) an owner of a time sharing interest who has acquired the time sharing interest for his own use and occupancy and who later offers it for resale on his own behalf or through a real estate broker;

And, I think that is where Dean is going with his line of questioning: What if someone called up the TSS and said - I want to sell my HHI - but - I don't want any right of rescission offered to the seller.

My personal assessment is: The TSS would be fully within their rights to honor that request. And, if they had to go to court over the matter they would win.

On the other hand - if I was the owner of the TSS (I would still have Florida Law hanging over my head) I would simply tell the seller we cannot come to terms as I am not willing to take the risk over 1 property. It is not worth eating up my profit to explore this anomaly.

Let me also add: If Hawaii, California or South Carolina changes their Timeshare Laws to mandate a 15 day right of rescission - IF I owned the TSS I would certainly look in to modifying my contracts!

Jerry - you are right: "Each state passes its own laws regarding the amount of time you have after buying a timeshare property to return it for a full refund."
But those laws apply based on where the property is located - not where the contract is written. If what your saying is true, then you would be free and clear to open up a office in Greensboro or Hilton Head so you could buypass those silly Florida laws.

 

[Dean]

Each state passes its own laws regarding the amount of time you have after buying a timeshare property to return it for a full refund. The process of returning an unwanted timeshare shortly after purchasing is known as Timeshare Rescission, or rescinding. The timeshare rescission process refers directly to the interval of time that is legally allowed to pass before you can no longer return a timeshare contract, or change your mind about your time share purchase. The ability to return an unwanted timeshare shortly after purchasing is not something your timeshare salesperson is likely to mention (unless you ask), but it is built into every state's legal code as a protection for consumers; some people also tend to refer to this time as the "cooling off period" following the purchase.

It makes no difference if you purchased your timeshare through RCI, Wyndham, Celebrity, Disney, Fairfield, Hilton, Hyatt, Mariott, or another timeshare, the Right to Rescission is entirely dependent on the state law where the timeshare property was Purchased / Sold. Each set of documents/purchase papers accompanying a timeshare sale will include form explaining how to rescind. It will likely be titled something similar to, "Cancellation of Time Share Purchase." If you fail to comply within the window of legal rescission you would forfeit your deposit and could be sued by the seller / developer.

Timeshare Rescission Cancellation Periods if purchased in:

Alaska – 15 days
Arkansas – 5 days
Arizona – 7 days
California – 7 days
Colorado – 5 days
Connecticut – 3 days
Delaware – 3 days
Florida – 10 days
Georgia – 7 days (business)
Hawaii – 7 days
Illinois – 5 days
Indiana – 3 days (business)
Iowa – 5 days
Kentucky – 5 days (business)
Louisiana – 7 days
Maine – 10 days
Maryland – 10 days
Massachusetts – 3 days
Michigan – 5 days
Minnesota – 5 days
Mississippi – 7 days
Missouri – 7 days (business)
Montana – 7 days
Nevada – 5 days
New Hampshire – 5 days
New Jersey – 7 days
New Mexico – 7 days
New York – 7 days
North Carolina – 5 days
Ohio – 3 days
Oregon – 5 days
Pennsylvania – 5 days
Rhode Island – 5 days (business)
South Carolina – 5 days
South Dakota – 7 days
Tennessee – 10 days
Texas – 5 days
Utah – 5 days
Vermont – 3 days
Virginia – 7 days
Washington – 7 days
West Virginia – 10 days
Wisconsin – 5 days (business)

There are some state missing. I do not have the data on these other states.

Not to beat a dead horse but none of that is really in question. The ONLY real questions at this point are whether the FL law requiring the 10 day cancellation period is binding on an out of state timeshare sale and whether the proper cancellation procedures were followed in this case. If you believe it does apply, stating so directly and specifically would certainly simplify any discussions. I'll assume the proper procedures under FL law were followed for cancelation unless the OP says otherwise. My investigation on the former (FL law applying to out of state resales) through BPR and at least one lawyer today suggests that it would most likely not apply. I say most likely simply because it would be up to a judge to make a final determination if it were pushed legally, I couldn't find any legal precedence one way or another on a quick search. Further, it appears from what I've seen so far that ONLY FL laws would apply to resale from what I've seen so far, all of those other lengths are for retail or developer only. One angle we haven't hit upon is what the DVC POS says. I'm pretty sure all of mine say FL law is applicable, I'm betting that HH says SC law is applicable.

 

[VTNuke]

Not to beat a dead horse but none of that is really in question. The ONLY real questions at this point are whether the FL law requiring the 10 day cancellation period is binding on an out of state timeshare sale and whether the proper cancellation procedures were followed in this case. If you believe it does apply, stating so directly and specifically would certainly simplify any discussions. I'll assume the proper procedures under FL law were followed for cancelation unless the OP says otherwise. My investigation on the former (FL law applying to out of state resales) through BPR and at least one lawyer today suggests that it would most likely not apply. I say most likely simply because it would be up to a judge to make a final determination if it were pushed legally, I couldn't find any legal precedence one way or another on a quick search. Further, it appears from what I've seen so far that ONLY FL laws would apply to resale from what I've seen so far, all of those other lengths are for retail or developer only. One angle we haven't hit upon is what the DVC POS says. I'm pretty sure all of mine say FL law is applicable, I'm betting that HH says SC law is applicable.

I would think that if there is a clause, such as in this case, that states the buyer has 10 days to back out, AND if that 10 day period is longer than the state law for whichever state you want to say has jurisdiction, the 10 day rule would hold up in court. The intent of these laws is to protect the buyer, not the seller, so a clause that offers more protection to the buyer would be backed up by the court cases. Timeshare sales have a bad name in general with a ton of unethical sellers prior to these types of laws being passed.

Most of these laws were really based on direct sales, and although they apply to resales as well, they were less an issue than the direct sales market. Please keep in mind Disney and DVC do not have that reputation of unethical behavior.

 

[Dean]

I would think that if there is a clause, such as in this case, that states the buyer has 10 days to back out, AND if that 10 day period is longer than the state law for whichever state you want to say has jurisdiction, the 10 day rule would hold up in court. The intent of these laws is to protect the buyer, not the seller, so a clause that offers more protection to the buyer would be backed up by the court cases. Timeshare sales have a bad name in general with a ton of unethical sellers prior to these types of laws being passed.

Most of these laws were really based on direct sales, and although they apply to resales as well, they were less an issue than the direct sales market. Please keep in mind Disney and DVC do not have that reputation of unethical behavior.

I don't think anyone is arguing that the contract would hold up for cancellation or the reasons for the laws in place. The question is what is the underlying jurisdiction and how would the various state laws be applied. To me the OP's situation is simply a springboard to the larger underlying issue. Actually most (maybe all but FL) do not appear to apply to resales by a private individual.

 

[bom_noite]

I'm pretty sure all of mine say FL law is applicable, I'm betting that HH says SC law is applicable.

What I posted earlier:

I was curious what my BCV contract states. It appears DVC may attempt to cover themselves with the following wording: This agreement shall be governed under and interpreted and enforced in accordance with the laws of the state of Florida.

I would guess that if an HHI owner looked at their contract they would see the the exact same wording.

It goes on to say (paraphrasing the legalese), if any provision of this contract is in violation or is usurped by any local law then only that one isolated point would be considered moot and the remainder of the provision (not in violation) and contract will still be considered valid.

It appears to me that the DVC Lawyers are stating that they would like to have Florida Law prevail. But, they also acknowledge that local laws can at times take precedence. And, if and when that occurs (and we are called out on it) - here is how we will handle that.

 

[mikron]

I understand the 10 day rule, but this allows the buyer to hold and look for better pickings.

 

[bom_noite]

I understand the 10 day rule, but this allows the buyer to hold and look for better pickings.

I think it was originally created to protect consumers from high pressure timeshare sales tactics.

As has been pointed out South Carolina has the 10 day rule only for timeshare developers and zero days for a resale.

 

[Dean]

What I posted earlier:

I was curious what my BCV contract states. It appears DVC may attempt to cover themselves with the following wording: This agreement shall be governed under and interpreted and enforced in accordance with the laws of the state of Florida.

I would guess that if an HHI owner looked at their contract they would see the the exact same wording.

It goes on to say (paraphrasing the legalese), if any provision of this contract is in violation or is usurped by any local law then only that one isolated point would be considered moot and the remainder of the provision (not in violation) and contract will still be considered valid.

It appears to me that the DVC Lawyers are stating that they would like to have Florida Law prevail. But, they also acknowledge that local laws can at times take precedence. And, if and when that occurs (and we are called out on it) - here is how we will handle that.

This is pretty standard timeshare speak when lawyers are involved as well as standard wording for FL (and I assume other states) statutes to protect any statue or portion in case one portion is deemed invalid or is contradicted somewhere else. Often non US timeshares (MX, Caribbean) will run their fees and contracts through a state (FL or CA esp) to give leverage against the owners in case they don't pay, otherwise there is no jurisdiction from other countries for US buyers other than to take the ownership itself. However, and even though I'm the one that brought it up, I don't think the POS would have any applicable components relating to resale and any cancelation phase unless DVC got in to the resale side of things.

 

[Dean]

I understand the 10 day rule, but this allows the buyer to hold and look for better pickings.

Actually the FL law gives a full year if you don't follow the rules in place. One could close and be months out and receive a cancelation notice in theory.

 

[TisBit]

Jerry, I am not trying to be difficult, but, I am struggling with the entire "Florida Law Prevails". I am sure you are sick of this, but, it is a very interesting topic.

Everything I read suggests that South Carolina law prevails. States have absolute jurisdiction over the land and property within their borders (with some limited exceptions). If DVC offered a 10 day Right of Rescission and South Carolina required 20, do you think for a second that because WDW is based in Florida would mean anything to a Judge in South Carolina?

I was curious what my BCV contract states. It appears DVC may attempt to cover themselves with the following wording: This agreement shall be governed under and interpreted and enforced in accordance with the laws of the state of Florida.

I would guess that if an HHI owner looked at their contract they would see the the exact same wording.

It goes on to say (paraphrasing the legalese), if any provision of this contract is in violation or is usurped by any local law then only that one isolated point would be considered moot and the remainder of the provision (not in violation) and contract will still be considered valid.

It appears to me that the DVC Lawyers are stating that they would like to have Florida Law prevail. But, they also acknowledge that local laws can at times take precedence. And, if and when that occurs (and we are called out on it) - here is how we will handle that.

While I am not a lawyer, I have some background with contracts. From my experience the lawyers usually like to meet or exceed any individual state or national law so they can steer clear of potential lawsuits. For example: DVC was kind enough to give me a 15-day right of rescission. Why 15 if Florida only requires 10? Perhaps because some states provide 15 days.

In this case my GUESS is this: I have no doubt that SC law applies. On the other hand, the SC law insinuates that the right of rescission was constructed to protect the buyer. A 10 day right of rescission increases the protection required by SC Law. The seller was provided a contract that clearly spelled out 10 days and acknowledged that fact with a signature. No Harm - No Foul.

In my mind the question is not: Is 10 days legal or illegal. I think the question is what State Court would hear the matter. My guess is a FLA Judge would say I am not going to adjudicate a matter involving SC Statutes and throw the case out.

In my experience with the courts, I think the only issue would be as you stated, a shorter period then required, not longer. If Florida law required only 5 days and SC law 10 days and TSS refused to rescind at 8 days, there would be some legal issues.

Like many other things, the law requires a set number of days to rescind....the TSS store cannot go below that number, but if they give more days to rescind, there are far less legal issues and the TSS is covered more completely. The only question is, did the seller understand and be informed of this right to rescind and the amount of time the buyer had.

 

[Dean]

In my experience with the courts, I think the only issue would be as you stated, a shorter period then required, not longer. If Florida law required only 5 days and SC law 10 days and TSS refused to rescind at 8 days, there would be some legal issues.

Like many other things, the law requires a set number of days to rescind....the TSS store cannot go below that number, but if they give more days to rescind, there are far less legal issues and the TSS is covered more completely. The only question is, did the seller understand and be informed of this right to rescind and the amount of time the buyer had.

That portion of the POS would only apply to developer sales, not private resales.

The only question is, did the seller understand and be informed of this right to rescind and the amount of time the buyer had.

I don't think TSS really did anything wrong regarding the cancellation period but I do believe the wording in the contract used gave the buyer more options than they legally had otherwise. Thus the only real question to me isn't whether they gave the buyer a 10 day cancellation period, they clearly did and it was apparently clearly included in the contract. The only questions to me are 1. Did they (or should they) inform the seller about this variation (I say yes) and 2. is it ethical to continue to work with a buyer if they've already canceled one contract. They probably should have informed the seller about this issue either at listing or at contract discussions and IMO, it is not ethical to cont to work with a buyer who simply backed out of a legit contract. Realize that EVEN if FL law would prevail in this situation, it didn't have to be applicable. The seller could have listed with another company where it would not have applied had they known about this issue, no one knows what they would have decided had this been know, likely even the seller at this point.

 

[BWV Dreamin]

Dean's comments ( thanks for them by the way!) also raise another question. Where does the fiduciary responsibility lie if the broker represents both parties? I've never understood how this dual representation can occur with timeshare sales, where by law, this is not allowed in the housing real estate market. From an ethical POV, the broker should have that responsibility to the seller as they are paying them a commission for their services, and such needs to do whatever is legally possible to facilitate the sale. A buyer who willingly backs out of an agreement should at least not have that sellers listing agent continue to work with the buyer on another sale.

 

[Jason@dvcstore]

IMO, it is not ethical to cont to work with a buyer who simply backed out of a legit contract.

Dean--It is your opinion that it is not ethical for a company to continue to sell to a buyer who changes their mind about purchasing their product when they are canceling in the legal time given to them?

I worked for Disney Vacation Club from 1999 to 2001 and there were many cases where someone was becoming a new owner directly from Disney who had previously bought from Disney and had canceled for some reason. I don't think Disney Vacation Club should turn these buyers away because they canceled once before and I don't think The Timeshare Store, Inc.® should ever turn a buyer away because they canceled once before either.

I might be wrong regarding your opinion but I just wanted to let someone out there who may have bought from The Timeshare Store, Inc.® 5 years ago, 2 years ago or whatever that even though they may have once canceled their purchase they are more than welcome to come back to us and we will try and find you a property.

Jason

 

[Jason@dvcstore]

I've never understood how this dual representation can occur with timeshare sales, where by law, this is not allowed in the housing real estate market.

At The Timeshare Store, Inc.® we actually work as a transaction broker. I don't want to get that term confused with a dual agent. In the state of Florida the housing real estate market is typically handled in the transaction broker manner.

If you come to Florida or contact a real estate company in Florida you should assume the agent is operating as a transaction broker unless they notify you otherwise as stated below.

"As of 2008, the Florida Association of REALTORS® states that all buyers and all sellers, upon contacting a REALTOR®, are to assume the agent is operating as a Transaction Broker, unless they notify you otherwise."

Jason

 

[Jason@dvcstore]

Are the sellers informed of this? Was the OP informed or did they overlook it?

I hope I don't look too silly asking this question but I am trying to follow the thread and I can't figure what "OP" is short for which probably should be obvious.

For the longest time I thought the "DH" was referring to "Disney Husband" but someone finally told me it is "Dear Husband."

Jason

 

[Dean]

Dean--It is your opinion that it is not ethical for a company to continue to sell to a buyer who changes their mind about purchasing their product when they are canceling in the legal time given to them?

Maybe unethical wasn't the right choice or words (too strong) but I do believe it is not a good practice to cont to work with a buyer who simply backs out of a contract even if it is legal. I do think it's different for a resale situation than for retail. Normally in retail you are either not continuing to work with the company to purchase or you are cont to work with the same agent and seller. Obviously it depends on the circumstances and I don't know the circumstances in this case as to why the buyer backed out and I realize that you couldn't say much if you wanted along those lines for confidentiality reasons.

Are you going to address the question directly as to whether you and/or TSS feel that FL law is directly applicable to resales for other states handled through a FL based broker?