Browse Month

November 2016

MacDonald Resorts and Reasonable Recompense for Relinquishing.

Inside Timeshare has run several article on the difficulty many people have in “getting out” of their timeshares, not just in Europe but also in the USA.

Recently one of our regular readers Alan Stewart sent in some information which to say the least was staggering, this involved one company that we have written about in the past, MacDonald Resorts.

As we know they have put into place a relinquishment programme, which they believe is fair, most would not agree. Under their system a limited number of people can apply to hand back their membership, this is on a first come first served basis. It is also only offered every other year with limited numbers. Another aspect is the amount of maintenance they require in order to hand back, four years worth. For many that could be a huge amount.

The information Alan has supplied, apparently from the AGM documents is as follows:

From the Villacana Club;

36 apartments have been removed from the club and transferred to MRL. (MacDonald Resorts Ltd)

939 Holiday Certificates have been given back to MRL.

Also that £417,163 went into the Clubs Sinking Funds because of the money paid by owners to get out, but what it doesn’t say is that £1,251,489 went into MRL’s own pocket because of this.

I have just found out that they have also got from Elmers Court £1,091,985 that’s £2,343,474 so far from just two clubs.

I wonder just how much they received altogether from all the Clubs for their so called “REASONABLE RECOMPENSE”

In his message Alan uses the term from MacDonalds themselves “REASONABLE RECOMPENSE”. What is reasonable about taking these amounts from members who have paid their maintenance bills for years?

Why do they still pursue old ladies such as Mrs B for non payment, even though they paid for 10 years without using due to illness? (see link below)

http://insidetimeshare.com/illness-not-reason-surrender-timeshare/

It is well known that for these companies to continue to operate they need the maintenance / management fee from you their members. With an ageing membership and the lack of “new blood” buying into these clubs, they have dwindling finances, as they tell you themselves, the cost will be passed to remaining members. That is the excuse they use for “Reasonable Recompense” from those wanting to leave.

The question is why are people not wanting to buy in?

The simple answer is the internet now offers a bigger choice, without the problem of maintenance, another reason is probably down to the industry itself. Many may have seen the problems associated with timeshare from their own parents and family, this would obviously put them off. So again the industry has only itself to blame. Unfortunately it will be the remaining owners who will have to stump up the money to keep these clubs going, after all someone has to pay and it will not be the company.

Thank you to Alan for the information, it is through people like yourself that we can share with and inform others of what is going on.

Timeshare Transfer Agents and Exit Companies: Friend or Foe?

Irene Parker and I take a look at timeshare relinquishment comparing Europe to America. As many Europeans own timeshares purchased in America, it’s useful to have the complete picture. This time she asks the question “Timeshare Transfer Agents: Friend or Foe?

For those not familiar with the term, Transfer Agents advertise offering timeshare owners a guaranteed “deed-back” even if the timeshare program is not deeded. (more on this further on).

In Europe we have a different take on this subject, as we do not have the same model of Transfer Agents like the US. We tend to have resale firms and exit companies, some purport to be legal firms, who for a sizeable fee will relinquish your contract. Many of these companies do both, so the lines can be a ltiile blurred. Although we do have some of the same problems, such as resorts /developers who do not recognise the sale and or transfer.

Here we bring in the ongoing story of two elderly sisters, known as Mrs B. Around two years ago they took up the services of a company  who claimed they would get compensation for them if they joined their “Class Action” group. But in order to do this they had to pay around £5965 to relinquish their two timeshares, one was Oasis Lanz in Lanzarote, the other was Dona Lola Club on the Costa del Sol, run by MacDonald Resorts and Hotels.

Mrs B signed a power of attorney so the company could work on her behalf, all appeared to be above board. After around a year she eventually received notification that her timeshare had gone, both had been transferred / sold to a gentleman for £1 each. Inside Timeshare has all documents relating to this.

Sounds all well and good.

Well, as far as Oasis Lanz is concerned it is, Mrs B has not had any contact from them or received any maintenance bills. The problem is Dona Lola Club and MacDonald Resorts, they will not recognise the transfer. This has now caused a problem for Mrs B and her sister.

They have been subject to threats of legal action by a debt collecting agency, Network Credit Services, employed by MacDonald Resorts. According to them there is £1412.54 (as of April 2016) for maintenance, accrued after the supposed transfer, (this amount increases as time goes on).

So why do MacDonald Resorts not recognise this transfer?

On speaking to Network Credit Services and explaining that the debt was under dispute, Maureen stated that MacDonald Resorts will not recognise any transfer made by this company, because in Maureens words McDonalds just get paperwork back from  saying no longer required”. In other words, there was no actual sale or legal relinquishment. You will see the same in the article by Irene, using a company to take on the transfers.

This case is still ongoing with official complaints about the chasing of this “debt” going through the Financial Ombudsman Service.

Another aspect that is very common in Europe is the “Bait and Switch” tactic employed by many companies claiming to be “resale” firms.

The basis of this method is very simple, the timeshare owner either contacts a company they have found on the internet, or, they have been cold called by. They promise they can sell your timeshare and even give a very high valuation over the phone. Next they arrange a meeting to discuss your options.

Unfortunately there is no resale market, with one company actually stating this, so what then happens?

Simple, in order to get rid of your timeshare you must now purchase another product, be it leisure credits or discount holiday club. At the meeting ( read sales presentation), you are told that the product will cost around £10k to £12k. But don’t worry, we will discount that price for the value of your timeshare, so it will only cost you a fraction of that amount.

This was used to dupe many owners into Club Class and DWVC, where the incentive was the cashback offer. With this you are given a certificate for the value of the timeshare plus the cost of joining the club. In 3 to 5 years, as long as you follow the rules (which were complicated) you could then claim back the value on the certificate. So far we have never known anyone who did get paid out.

But what happened to your timeshare?

For many it was simple, they did not get rid of it, then after a couple of years they found they owned years of back maintenance. The timeshares were not transferred or relinquished, they are still liable for the maintenance and still own it, causing many a stressful situation with debt collectors.

So, let us look at what the situation is in the USA.

Timeshare Transfer Agents: Friend or Foe?

dollar    By Irene Parker November 20, 2016

Lately, a company by the name of Resort Release has been running an ad on my Facebook feed. It is always frustrating to invest time and energy campaigning to improve the timeshare industry, only to have companies we don’t approve of take out ads promoting their service. At least Inside Timeshare can control who posts on their site.

Transfer agents advertise offering timeshare owners a guaranteed “deed-back” even if the timeshare program is not deeded. The upfront fee ranges from $3500 to $7000 or more. Contracts taken back are “bundled” 25 to 50 and sold back to the developers, similar to what happened during the worldwide subprime mortgage crisis. The developers resell for full value.

What else can happen to the points or weeks or “inventory” recovered?

According to Greg Crist of the National Timeshare Owners Association,   

“There are basically four buckets that transfer companies often attempt to put inventory into…

Bucket 1 – Works with an inventory broker who may or may not have a direct inventory recovery agreement. *Branded properties only

Bucket 2 – Lists timeshare properties on eBay and Craig’s List for $1.00

Bucket 3 – Transfers to “Mules” *Foreign Nationals who may be judgement proof

Bucket 4 – Transfers to Companies who later dissolve the corporation administratively. *Leaves resort pursuing a clouded title, doubling recovery costs and impacting association’s bad debt line, which all remaining owners on the roster end up absorbing.”

saleman

Keep Reading

Timeshare Consumer Association: Incorrect Information

What are the regulations regarding cold calling?

This question has been prompted by the latest post on the TCA website, in their post they talk about a company based in Barcelona called La Moneda, this particular company was highlighted on 4 November by Mindtimeshare. This in itself is not the problem, it is the incorrect information they give regarding cold calling.

They state “Cold calling in the UK is illegal as it is considered a breach of privacy”. This is actually incorrect, according to the Information Commissioner’s Office website they state:

You can call any individual who has specifically consented to receive marketing calls from you – for example, by ticking an opt-in box”.

“You can also make live calls without consent to a number if it is not listed on the TPS – but only if that person hasn’t objected to your calls in the past”.

“In practice, this means you will need to screen most call lists against the TPS register. You will also need to keep your own ‘do not call’ list of people who object or opt out, and screen against that as well”

call-centre-2

The rules for live marketing calls are very simple and are as follows (again taken from ICO website):

“The rules on live marketing calls are in regulation 21. In short, you must not make unsolicited live calls to:

  • anyone who has told you they don’t want your calls; or
  • any number registered with the TPS or CTPS, unless the person has specifically consented to your calls – even if they are an existing customer.

You must always say who is calling, allow your number (or an alternative contact number) to be displayed to the person receiving the call, and provide a contact address or freephone number if asked”.

TPS is the Telephone Preference Service for individuals, all lists must be screened through this service, but it only applies to companies based in the UK, any company based elsewhere is not bound by it.

CTPS is the Company Telephone Preference Service and is for companies and other corporate bodies.

calls

We know that cold calls can be annoying, but it is a legitimate marketing tool, as long as the regulations are adhered to. In the end you are the one in control, you can just say not interested and ask them to remove you from their list. Once you asked them to remove you, then it is illegal for them to call again.

It is just a shame that a so-called Consumer Advice Association cannot even get their facts right, so the question has to be asked, can you trust any advice they give?

I leave you to decide on that one.

Follow the link for more information on this subject:

https://ico.org.uk/for-organisations/guide-to-pecr/electronic-and-telephone-marketing/telephone-marketing/

If you have any questions or comments on any article published, contact Inside Timeshare, if we do not know the answer we will find it.