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What is
Timeshare?
( It is spelled as one word, not two words: TIMESHARE. )
How It Works:
Once
you own a timeshare, you will have a happier life with it if you understand how the system works. In early times
it was a simple process, easy to explain and to understand, but with the growth of the industry and the introduction
of new types of systems it has become more complicated.
In general, it is still best to purchase at a resort and time
of year that you really like and where you would be happy to return each year for your vacation. However, some
people purchase mainly for the exchange possibilities, and that is where a lack of understanding can cause new
owners to think they've made a mistake by purchasing timeshare.
Below is a basic explanation of how to get the most out of your
timeshare purchase if you intend to take advantage of the exchange systems.
Realistic expectations
" No generality is worth a damn, including this one." --Oliver Wendell Holmes
Having said that, here are a couple of generalities that will
help you understand the system and get satisfaction from your timeshare purchase: 1) Expect to exchange like value for like value
and 2) Try to be a little flexible. Once you understand this-- plus what the value of your week actually is-- you
can conduct exchange searches that are more likely to get you what you want.
- Like for like: Your best chance for making a successful exchange is to ask for a resort that
is similar to yours in quality and in an area and season of similar demand. Determining the value of your week
involves several criteria, which we discuss HERE, but in short you may look at it this way: If your exchange week is
a studio in a location that is not highly popular, during a season when no one wants to go there, the odds that
you will be able to exchange it for any size unit during Christmas week in a place like Hawaii are slim to none.
Also, if you have a high season week in a popular place with
an overabundance of resorts, you may only be able to
exchange into certain other areas during periods with less demand because there is more supply than demand. On
the other hand, a studio during high season in an area of high demand and short supply might get you into almost
any area at any time, and in a larger unit to boot.
Flexibility: An exchange can only be completed if someone deposits a week that you want and
no one is waiting ahead of you for that week. If you increase the locations or number of acceptable resorts you
are willing to consider, deposit your week as early as possible and/or allow for a wider range of check-in dates,
you will increase your chances of making a successful exchange. If this kind of flexibility in your vacation desires
is not possible for you, if you are restricted as to the time period and/or geographic area you need for vacationing,
you might want to consider owning at a resort where you are happy to return most of the time. In such a case, exchanging
might not be the best choice for you.
How to make an exchange
Simply said, when you make an exchange with an exchange company you agree to give up your timeshare usage right
in exchange for the right to use one of the weeks someone else has deposited in the exchange company's " Spacebank"
. (Note that some exchanges companies will let you look through their inventory before you deposit your week other exchange companies won't allow you to search
until after
you deposit your week. You'll have to learn which alternative your exchange company uses before you start.)
Once you know the rules for your exchange company, you start your search by telling the exchange company what you
want, ie: geographic area, when you want to go, minimum size unit you'll accept, amenities you'd like to have,
and maybe specific resorts you are willing to consider.
The exchange company will then search their inventory to see
if they have anything available that meets your criteria and that is of
comparable value to the week you are depositing.
If there is, they will offer it to you as an immediate exchange. If they have nothing available that meets the
criteria, they will probably offer to put you on a " waiting list" in the form of an on-going search
for what you want. That way, if in the future someone deposits a week that matches your criteria you will be notified
and asked if you want it.
Once you accept an exchange: You need to make sure you know
the rules with the exchange company you are using. Some
exchange companies allow you to change your mind and cancel without penalty by offering a period of time to think
about it-- generally 24 hours or until the end of the next business day. Others will automatically complete the
transaction the minute they find a resort that meets your search criteria and then notify you if you don't want
it they may require you to pay a cancellation penalty.
Note that when your search for an exchange is not successful that doesn't necessarily mean the exchange company
doesn't have what you're looking for it might mean that they don't have a unit that meets your criteria and the exchange value of your week.
So, if you are using a low-value week to search for a high-value week, inventory that meets your criteria may be
deposited to the spacebank but will not be offered to you (unless no one takes that deposited week and its value
declines as its " expiration date" approaches).
Again, some of the factors that affect value are discussed HERE.
Depositing with an exchange company
How you go about depositing a week will depend on the type of ownership (fixed or floating) and which exchange
company you use. Make sure you understand the requirements with both your resort and the exchange company. In all cases, however,
the earlier you deposit your week the better the odds
are that you will get the exchange you want.
NOTE:
Exchange companies usually observe time limits for the deposit and use of a timeshare week. For example, with RCI you
cannot deposit earlier than two years in advance of the check-in date, and you have to accept a unit with a check-in
date no later than one year after the check-in date for your deposited unit. (You can extend the expiration date
with some exchange companies-- for a fee.)
As with hotels, airlines, Bed & Breakfasts, etc., you must
remember that even in timesharing everything is "
based on availability" .
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Fixed weeks
If you own a fixed week, you can usually deposit your week directly with the exchange company affiliated with the
resort where you own. In this case, the exchange company's records will show that you own that particular week
at that resort, so depositing can be as simple as a phone call or an on-line transaction with the exchange company.
If you deposit with an independent
exchange company, you will probably need to provide
some proof that you have the right to use that week, that your maintenance fees are paid, etc. The exchange company
will probably contact the resort for verification.
Floating (Flex)
weeks
If you own a floating week, you need to contact your resort to reserve a week before you can deposit it. Again,
the earlier you do this, the better your chances will be of getting the specific week that you want for exchange.
If you are depositing with an independent exchange company,
you contact the resort to reserve a week just as you would if you were planning to use the week. You then deposit
that week with the exchange company.
If you are depositing with an exchange company specifically affiliated with your resort it can be more complicated.
In the simplest situation, you reserve a week as described above, then deposit that week with the exchange company.
The exchange company will then contact your resort to verify that you indeed have the right to use that week.
Bulk Spacebanking: Bulk spacebanking means a resort deposits a large number of " unassigned"
units with the exchange company before owners decide to deposit their weeks. In such an instance the resort
will deposit weeks with relatively low demand based on previous years' history. They generally hold on to high
demand weeks for owners who choose to stay at the resort. (This precludes exchangers from getting the highest possible
trading power from their floating week since the highest demand weeks are held for use at the resort.) In this
scenario, you contact your resort to let them know that you intend to use your week for an exchange. The resort
will then tell the exchange company to transfer one of their bulk spacebanked weeks to your account in most cases
you do not get to choose which week you want.
> > The exchange
value of a timeshare
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