Understanding what timeshare fraud is and how scammers target owners and buyers can help you avoid financial loss and significant stress.
In this guide, we explain the most common types of timeshare scams, red flags to watch for, and the steps to take if you’ve been targeted.
Timeshare fraud refers to deceptive practices that trick individuals into paying for services related to their timeshare ownership that are either false or misleading. Scams target both owners and buyers, promising resale, rental, or exit solutions that often never materialize.
The FBI reports that Americans lost more than $300 million to timeshare scams linked to Mexican properties alone, in just the last five years.
Below are the most common types of timeshare fraud:
Fraudsters claim they have a buyer ready to purchase your timeshare at a high price, but first demand upfront fees for listing, appraisals, or “transfer taxes.” Once paid, they vanish.
Scammers pose as “exit companies,” promising to cancel your timeshare contract for a fee. Some even instruct you to stop paying your maintenance fees and redirect funds to them, leaving you in worse financial trouble.
Requests for escrow deposits, taxes, or legal costs before any service is delivered are a major red flag. Legitimate transfers don’t require large upfront payments.
Owners are told a renter is lined up for their unit. The scammer then requests advance “rental-related” fees for damages or taxes before disappearing.
Pro tip: Check out these helpful articles on what to look for when signing a timeshare rental agreement and how to rent a timeshare.
Buyers are tricked into purchasing timeshares in properties that either don’t exist or aren’t legally available as timeshares.
At purchase or timeshare presentations, high-pressure sales tactics can misrepresent value, availability, and investment potential. Hidden maintenance fees and restrictions often appear later.
Pro tip: Find out how to buy a timeshare here and how to get the best timeshare deal from resorts or developers here.
Previous scam victims are contacted again by fraudsters who promise to recover lost money, but only if another upfront payment is made.
To avoid being scammed, we recommend being alert to these warning signs:
Pro tip: In our article on common timeshare exit scams, we’ve included a personal account of someone who’s been scammed, and you can read more about how con men impersonate lawyers here.
Pro tip: If looking to exit your timeshare, always check directly with your timeshare developer first. Some offer legitimate resale, cancellation, or exit options such as deed-back programs. If the developer can’t help, learn about all other exit options available to you in our comprehensive guide.
If you suspect timeshare fraud:
Reporting not only helps your case but also assists law enforcement in shutting down fraudulent operations.
Timeshare Specialists and Resort Closings have set up the nation’s first and only timeshare scam hotline. If you have a case or questions, please give us a call. We’d like to understand what’s happened to you and help you. We also recommend using our Timeshare Scams Database, which lists over 200 fake timeshare selling or escrow companies.
Timeshare fraud is unfortunately common, but with awareness and due diligence, you can protect yourself from it. If you want to learn more about safe exit options, check out our services here and only opt for a reputable timeshare exit company (here are some reputable companies that can help you sell your timeshare).
If you’re looking to divest of your timeshare, at Timeshare Specialist, we’ll review your timeshare at no cost and tell you honestly if we can help. If we can’t, we’ll tell you that, too. Give us a call, fill out our contact form, or use our chat option to start the process today.
Timeshare fraud involves scams targeting timeshare owners or buyers, such as resale, rental, or exit scams, which often involve upfront fees for services that never materialize.
Be cautious if the offer is unsolicited, includes guaranteed results, or requests hefty upfront fees. Legitimate resales rarely involve these red flags.
No. While many scammers pose as exit companies, reputable and licensed providers exist. Research thoroughly and check reviews before hiring.
Stop all communication, notify your bank, gather relevant documentation, and report the fraud to the FBI’s IC3, the FTC, and your State’s Attorney General.
It can be challenging, but reporting quickly increases your chances. Recovery scams that promise to get your money back for a fee are usually fraudulent.
Never pay upfront fees, research companies with the BBB, check out our scam database, and always verify if your timeshare developer offers official programs.
Whether supporting a good cause or looking to divest your timeshare by donating it or gifting it to a friend or family member, our How to Donate or Gift Timeshares guide will walk you through all the steps you need to take.
Understanding what a timeshare exit company is and how it can help you can be half the battle if you’re looking to get out of a burdensome timeshare. This guide explores all those points and explains why Timeshare Specialists is a trusted partner in your timeshare exit journey.
