This is a fairly common question if you frequent certain timeshare forums and complaint websites; sometimes it is a question asked by a consumer who is worried about the possibility due to personal circumstances, but in others it is a question placed by cancellation scammers in order to lure other people in.
Consequences if you don’t pay your timeshare
If you want to know the truth about the consequences if you don’t pay your timeshare you should read on; we have the low-down right here.
What happens if I stop paying for my timeshare?
If you find that you cannot, or suspect you might not be able to, make your payments you should talk with your timeshare provider to see what they can do to help. In any case, though, you should inform yourself about what is likely to come, and prepare for your credit score to dip as well as potential legal issues.
The consequences if you don’t pay your timeshare
Whether you default on your loan repayments or your maintenance fees, the consequences will be similar… however, you will likely be afforded a little more time to get up to speed with your maintenance fees than your loan (especially if you paid by credit card). If you absolutely cannot make payments you’re going to need to prepare for what is to come.
Consequences of not paying your timeshare maintenance fees
When you default on your maintenance payments the most immediate consequence will be the inability to use your timeshare. There is also likely to be a delinquency fee, interest on outstanding balances, and a reinstatement fee before you can begin to use it again. Of course, if you continue to avoid your responsibilities your debt will likely be sold to a collection agency (and they are a great deal less friendly than the timeshare companies).
Consequences of defaulting on your timeshare loan repayments
Defaulting will begin to have detrimental consequences even more quickly than forfeiting on your maintenance fees. As with any form of real estate, forfeiting on your timeshare payments could result in foreclosure and legal action as well as damage to your credit score and the selling of your debt to a collection agency. Furthermore, this could cause you trouble when you seek to invest in the future!
Debt Collection Agencies
Once your debt is handed over to a collection agency you will face pretty much constant harassment and immediate damage to your credit rating. If you continue to evade paying your debt you could face legal action, and you may even be reported to the Internal Revenue Service.
Your credit rating
If you can rectify the situation and get back on track fairly quickly you could avoid serious damage to your credit rating, but if you do not you will likely find it much harder to get credit in the future. It is utterly critical that you consider this, and of course that you consult your timeshare provider for options.
Beware timeshare cancellation scams
Finally, a little known consequence of forfeiting on your timeshare payments is the fact that you will come to the attention of cancellation scammers who are looking to capitalize on the misfortune of others. They will seek to convince people who are panicking that there is an easy way out; simply pay their fee and they’ll fix it for you… Sadly it doesn’t work like that, and such fraudsters leave many people in serious trouble.
The truth is that there’s no magic solution, quick fix, or easy way out if you don’t pay your timeshare; just like taking on a mortgage this is a big investment and commitment which has risks matching the potential rewards. If you are beginning to experience financial troubles please speak with your timeshare provider to see what they can do to help you!