We all know about how timeshare has been sold, the long drawn out presentation to wear you down, the oral misrepresentations to entice you, which then never materialise or appear in the contracts. Then we have the sales staff offering finance agreements if you cannot afford the timeshare, with these same sales staff arranging the loans and completing the application forms.
One such timeshare operator, Resort Properties / Silverpoint even went as far as selling packs of weeks as an “investment”, with an “oral” promise that these weeks would be sold at a “profit”, or even rented out to make the owner money.
The claimants say Resort Properties / Silverpoint arranged these loans indicating that by renting out the purchased “properties”, the incoming rentals would easily cover the repayments. As far as anyone knows this never materialised, if they were rented out the income just about covered the management fees on those weeks.
As for the reselling of those weeks for a “profit” which again they said would more than cover the cost of the finance, never happened. Everyone now knows that timeshare is not an investment, it is a drain. One only has to look on ebay to realise that people cannot even give them away, let alone sell them. We also see some very inflated prices from the many resale companies, after all those prices are what the owners want for them, not what they are worth.
These are the figures from one loan agreement over 15 years Inside Timeshare has been given for a 1 week timeshare, it is from Barclays:
- Cost of the timeshare £10,900.00
- Credit facility fee £65.00
- Interest £18,465.00
- Total amount payable £29,430.00
- Interest rate 17.6%
- APR 17.7%
So with an outlay of £29,430.00 it is not hard to see you will never recoup the “investment” promised.
It is also known that many of these sales staff falsified some of the applications, Inside Timeshare knows of one elderly couple who were pressured into signing up for one of these “investment” packs. When they purchased she was 76 and her husband was 78, both on small private pensions topped up with state pensions. Yet somehow they were given a loan through BPF for around £40,000!
The application was made out by the staff, they signed for the timeshare and the loan after around 6 hours of persuasion, also the husband was in need of his medication. It was not until several years later when they got into difficulty and the finance agreement was being looked over that it was found the income had been falsified.
When speaking with them they were asked, if had they gone to their own bank for a loan of this amount, did they think they would have been given it? Their answer was as you rightly suspect, a big affirmative NO! Their case against Silverpoint is waiting to be heard at the courts in Tenerife.
Another aspect of falsifying these loan applications is the purpose of the loan, on many we have seen it has gone down as “home improvements”. This was done to break the link with “timeshare”. Unfortunately, it could be argued that the people signing the agreements have been coerced into committing a fraud without their knowledge.
Barclay’s are not the only financial institution who are supplying the finance for timeshares, Hitachi and Shawbrook Bank provide such loans. In the case of Shawbrook, they announced back in July 2016, that they had set aside £9 million to cover defaults on these loans. They admitted they had not carried out their due diligence when accepting and granting them.
As far as “due diligence” is concerned, one has to ask how has this been done when the loans are agreed on the day?
- Have the correct credit checks been made?
- Has the income been verified?
- Has an income versus expenditure been done to check if the applicant can actually afford the repayments?
Somehow with the number of people Inside Timeshare has been in contact with, it would seem not. It looks like the only “checks” that have been made are ones that show your credit rating, such as Experian.
This has also been a problem in the US, where Irene Parker, Inside Timeshares US partner has been highlighting the problem.
Timeshare is going through a very big upheaval, with the likes of Resort Properties / Silverpoint, Anfi, Palm Oasis / Tasolan, Holiday Club / Puerto Calma to name a few, all being pursued through the courts. All of these companies have also had judgements against them from the Supreme Court in Madrid, the highest court in Spain, which have strengthened the Spanish timeshare laws. These cases are costing them dearly, we are looking at millions of pounds in repayments and declaring the contracts null & void.
If you have any questions or comments on this subject or would just like to know if you have grounds to make a claim, Inside Timeshare will find out for you and point you in the direction of reputable law firms.
Remember, there are many out there who say they are law firms but in reality they are not, many are just after selling you another product or even just out to steal your hard earned cash. A prime example of this is Litigious Abogados in Tenerife, which we have published many articles about.
As we have said before and will keep saying, doing your homework is vital.