The California Department of Real Estate has issued a consumer alert about the growing number of scams being perpetrated against timeshare owners in connection with timeshare resales.
Most scams that are taking place involve a promise of a quick sale of the seller’s timeshare interest in exchange for an upfront fee. However, after the fee is collected, little or nothing is done to sell the timeshare interest.
According to California DRE officials, there are three common fraudulent practices that scammers are utilizing.
The first is when timeshare reseller fraudsters pose as legitimate and licensed real estate brokers, thereby providing a false sense of security to someone buying the property. These scammers then demand the payment of money upfront in connection with the purported resales. However, no services of any kind are actually provided.
Secondly, scammers falsely tell timeshare owners that the “agent” has found a “ready and willing” buyer for their timeshares. The scammer asks for listing or “paperwork fee” to effect the transaction, but once the fee is collected, the seller never hears from the company again.
Lastly, fraudsters pose as timeshare buyers and use such advertising slogans as “will buy your timeshare for cash”, “timeshares wanted”, or something similar, to lure timeshare owners. The scammers then ask the owners for “a small amount” of money up front to process the paperwork for the transfer. Once those monies are paid, the owners never hear from the scammers again.
“Given the economic strain many families are facing, timeshare ownership is a luxury some families can no longer afford,” said Barbara Bigby, acting commissioner for the California Department of Real Estate. “And with so many owners wanting to divest themselves of their timeshares, it has created an opportunity for fraudsters.”
The DRE has offered several tips for consumers to be aware of in order to not become victims to these timeshare scams:
- The request for an upfront or advance fee is a red flag. You should contact DRE before agreeing to pay an advance fee to determine the lawfulness of the fee.
- Only licensed real estate brokers may list and sell “timeshares for resale.” Check the license status on the DRE website to determine if the company or broker is properly licensed.
- Request a copy of the reseller agent’s written contract that you will be required to sign and a written disclosure of all fees and costs, and you are wise to never pay for services or assistance in advance of the performance of services.
- Check out the company or persons with the Better Business Bureau.
- Check them out through a Google, Facebook, or related search on the Internet. Often consumers who have been scammed will post their experiences, insights and warnings long before any criminal, civil or administrative action has been brought against the scammers.
