During this time of financial difficulty, timeshare foreclosures have increased dramatically. Like foreclosures on homes, the result is very damaging to one’s credit for future large purchases. It’s simply another reason why many people should never purchase a timeshare ever.
But there is also a more hidden cost of timeshare foreclosures and non-payment of maintenance fees. The timeshare property management companies rely on having a certain level of revenue in order to maintain & manage the property properly. With a decrease in operating funds, they need to find it from other sources — namely those timeshare owners that CAN pay their maintenance fees. So, there are a number of reports of owners receiving special assessment bills due to the fact that the annual maintenance fees are not able to cover the operational cost of their timeshare resort.
It’s very similar to what is happening with local and state governments. Because of decreased tax revenue, they have to tax those that CAN pay to cover shortfalls. There’s very little use in taxing those that cannot pay, except perhaps penalties that may or may not be collected in the future.
All timeshare owners who paid their special assessments should ask if they can receive some of the profits when the economy improves and resorts are awash in maintenance fees. Think they’ll do it?