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Irene Parker

Friday’s Letter from America: Marcy’s Story Continued

Welcome to this week’s Letter from America and the story of Marcy, this story also goes to answer an often asked question “What happens if I just stop paying maintenance fees?” This is Marcy’s experience on this subject.

Marcy in California was left with little choice but to stop paying maintenance fees for two timeshares. Her never-ending struggles began in 2015. She had no outstanding loan with either timeshare. One of her timeshare companies now has a voluntary surrender program, but the liquidity problem is far from solved. 

Inside Timeshare first heard from Marcy in 2017. She contacted us terrified after receiving a threatening call from someone claiming to be an attorney from U.S. Consumer Attorneys.

Several lawsuits were filed against U.S. Consumer Attorneys. We heard they filed for bankruptcy. A marketer for an exit company informed us that they heard they were not taking new clients and then operated for a while under another name. The firm’s website was not accessible. 

Westgate filed a lawsuit against U.S. Consumer Attorneys in 2018

https://casetext.com/case/westgate-resorts-ltd-v-us-consumer-attorneys-pa

Wyndham filed a lawsuit against U.S. Consumer Attorneys in 2018

https://dockets.justia.com/docket/florida/flsdce/9:2018cv81251/535273

Diamond Resorts filed a lawsuit against U.S. Consumer Attorneys in 2018

https://www.law360.com/cases/5aa682b0ad39405fe6000007/articles

What Happened When I Stopped Paying Maintenance Fees  

See the source image

By Marcy in California

April 23, 2021

I have been reading many Facebook post comments from timeshare members asking what happens when you stop paying maintenance fees. I had no choice but to stop paying maintenance fees on one timeshare in 2015 and now have decided to stop paying maintenance fees on my remaining timeshare. I share my experience to support others like me – those who paid their bills on time all life long, but were left with little choice but to default. 

I think I am over and done with the timeshare from 2015. I sought release because of financial and medical hardship. I suffer from serious and chronic medical conditions. I am a widow, age 73.

I contacted Irene Parker in the spring of 2017 after receiving a call from Louis. He said he was an attorney with U.S. Consumer Attorneys. Phyllis in California contacted Irene the same day. We both stated that we were having a panic stress attack over our timeshare. To support and warn other seniors, Phyllis, Shirley, and I all shared our experience in May of 2018 in this Inside Timeshare article.  

https://insidetimeshare.com/fridays-letter-from-america-4/

Louis knew I owned a Diamond Resort timeshare at Ka’anapali Beach Resort in Hawaii and that I was two years behind on maintenance fees. He said I would have to pay him $2,900 to be released from the Diamond contract or they would take my home and could even take my children’s home should something happen to me. He further explained that my family would be responsible for paying our portion of all Diamond’s debts. They could even attach my wages if I was working, or my Social Security income. This man was horrible and I was terrified. I didn’t know what to do. I did not know if he was telling the truth. I was advised to inform Diamond Resorts and to inform Louis of this the next time he called. That ended that at least.  

Diamond Resorts now has a voluntary surrender program but they didn’t in 2015. When I contacted them in 2015 they would not take my week back. I was current on my maintenance fees when I inquired. I stopped paying maintenance fees. Three years passed without hearing anything. There was little to no effect on my credit score. Then, in 2018 I received a bill for $9,000 – three years of maintenance fees in arrears. I have not paid that amount and have not experienced any negative consequences, but it still kind of hangs over you. 

I reached out to Inside Timeshare once again this year about my Grand Palisades timeshare in California. We reached out to Grand Palisades in January to ask about their dissolution policy. I was current on maintenance fees, but after speaking with them I ceased making payments. 

I tried to sell this timeshare but no one wanted it. I had it posted on Marketplace for over a year and also tried to sell it on Craigslist. I called a licensed timeshare broker in California. He said that while Grand Palisades is one of the better timeshares, they felt there was no market for it. 

I spoke to a representative at the Grand Palisades HOA Loyalty Department. They said I would have to pay all of 2021 maintenance fees and then submit a request for medical hardship. The HOA would consider the request but there was no guarantee my request would be honoured.

I’m tired of fighting timeshares. I was current on fees in January, but after all that I’ve been through, it didn’t make sense to me to pay all of 2021 maintenance on the chance that I might be allowed a release. I pay quarterly so I would have to pay for the whole year. I am now two quarters behind. I offered $1,000 to take it back.

Why can’t the HOA evaluate a person’s medical condition and then have the owner pay the fees, especially if there is a termination fee added to the 2021 maintenance fees? The representative from Grand Palisades said that if I defaulted, there would be no consequences. At least that provides some comfort. 

Timeshares can be expensive and anyone’s life can change in an instant. One thing for sure – I needed help and from what I’m reading, so do many people. I don’t think the exit companies will disappear until the timeshare companies become more flexible with exit options. You don’t have to prove medical or financial hardship to sell a house. Inside Timeshare was there for me. Now I want to support others.  

Related article: Senior Defaults 

https://www.linkedin.com/pulse/senior-timeshare-defaults-irene-parker/

Once again Inside Timeshare would like to thank Marcy for her contribution this week, Inside Timeshare believes that these stories contributed by timeshare owners sharing their own experiences do help others. They help to answer the many questions that Inside Timeshare and our associated Fb groups receive on an almost daily basis.

 If you have any questions or comments on this or any other article please use our contact page and Inside Timeshare will get back to you.

Have a great weekend and join us again next week for more on the murky world of timeshare.

Friday’s Letter from America: Hilton Acquisition of Diamond

BREAKING NEWS

The Radio 4 program You and Yours will not be broadcasting the MacDonald Resorts segment today as planned, this is due to MacDonald Resorts contacting our reader and making an offer of settlement. Hopefully we will be able to publish a successful conclusion in the future.

Back now to our Letter from America.

Welcome to the end of another week with Inside Timeshare, today’s Letter from America is from an old friend, Irene Parker. It needs no introduction apart from it is a subject that has sparked many conversations, the acquisition of Diamond Resorts by Hilton Grand Vacations. Here Irene explores what this means to Diamond Members.

What does Hilton Grand Vacations Acquisition of Diamond Resorts Means to Diamond Members?

How Private Equity has Influenced Timeshare

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By Irene Parker

March 26, 2021

Several Diamond Resorts members have expressed bewilderment by the announcement this month that Hilton is acquiring Diamond Resorts. Former deeded owners of resorts purchased by Diamond – Monarch, Gold Key, Sunterra, ILX, Amber and others, were told that they had to give up their deed and convert to points. It is likely they will once again be told they must upgrade to have access to Hilton properties. Overall, Diamond members seem to feel Hilton’s acquisition is a welcome development. The transaction is expected to close by summer.

According to HGV CEO Mark Wang:

But when you think about the power of putting the Hilton brand on …. it will, number one, create a tremendous amount of credibility. It’ll allow us to attract customers, higher-quality customers than Diamond was able to attract.

We’re going to be– we’re launching a new brand called Hilton Vacation Club. And Hilton Vacation Club will be positioned just below Hilton Grand Vacation Club, which is an upper upscale brand. And Hilton Vacation Club will be an upscale brand. And the entry price points are significantly lower, about $20,000 lower to– to enter the system.

https://finance.yahoo.com/video/hilton-grand-vacations-ceo-diamond-154939235.html

What does it mean? How will it work?

According to Hilton’s website: 

Accelerates launch of HGV-branded trust product offering: rebrand Diamond’s properties over time to drive revenue growth in a new customer segment

My Comment: Trust-based means properties are owned by a Trust, but that is of no benefit to timeshare members who don’t “own” anything. Buyers of non-deeded points purchase a right-to-use product. They have no beneficial interest in a Developer’s Trust any more than a member of a Country Club or gym club has a beneficial interest in their club’s brick and mortar buildings. 

My question: Diamond’s properties are already in Diamond’s Trusts. Does Hilton plan to buy legacy (older) resorts, modeling Diamond’s business model?

  • Combining HGV’s points-based deeded product with Diamond’s points-based trust structure will allow the Company to cater to a wider audience, attract more new buyers and drive incremental growth in a capital-efficient manner.
  • HGV’s deeded product provides premium pricing, inventory sourcing flexibility, and the ability to pre-sell projects to support strong project-level cash flow, while giving buyers and owners the value of guaranteed availability.

My question: How is availability guaranteed? According to Hilton members I spoke with, availability is guaranteed by means of an advanced booking window. It’s not the same as owning a fixed week that is a true guarantee.     

  • The introduction of a trust product allows for lower barriers to ownership, reduced inventory delivery volatility and inventory recycling, enabling smoother sales and upgrades while providing buyers and owners network and pricing flexibility.

The biggest question on the minds of many Diamond members is – will there finally be a resale value. Rules change, but at last check if you buy Diamond points on the secondary market, you must buy 50% of the number of points you bought on the secondary market, directly from Diamond to be eligible for The Club, to be able to exchange. Will Hilton be so restrictive?   

Inventory delivery volatility reduction must be because points are of almost unlimited supply and eternal. 

Inventory recycling means foreclosing or taking back points. 

“Smoother sales and upgrades” is something Diamond members are very used to and many are wary of. 

One Diamond member expressed Diamond’s pricing flexibility: 

Kona 11/6/18 – Our agent tried to convince us to purchase Hawaii collection points for $11.40 per point, as opposed to $4.79 presented on Oahu the week before. Manager Brett asked us where the $4.79 came from. We shared the paperwork we had been given. He became rude and threatening saying, “it is illegal for you to have these papers.” The papers had been given to us.   

  • Integrates Diamond’s innovative Events of a Lifetime® experiential sales and marketing platform that drives strong engagement and Volume Per Guest (VPG) premiums with HGV’s owner base

My Comment: It is hoped Hilton will do a better job of informing the person presented with an EOL that it is a solicitation. 

Volume per Guest is a metric that is often used to show efficiency in sales. Total sales volume divided by the number of tours “guests” that each site has. 

Ex. Site sells 200,000 on a day with 25 guests = 8,000 VPG – This is the expectation for existing owners. (Figures provided by an industry insider)

Many on our Diamond member-sponsored Facebook have questioned how this remarkably high VPG has been achieved. 

https://www.facebook.com/groups/DiamondResortsOwnersAdvocacy/

DRI 7,000-12,000 VPG 

Wyndham 3,000-4,000

Bluegreen 3,000-4,000

Marriott 3,000-5,000

Hilton 4,000-5,500  

https://www.hiltongrandvacations.com/-/media/project/hgv/presence/news-media/press-releases-pdf/hgv_press-release_2021-03-10_final.pdf?la=en

The History and Effect of Private Equity on Diamond Resorts and Timeshare 

It’s not your Grandmothers’ Timeshare

Leon Black founded Apollo in 1990 with partners from Drexel Burnham Lambert, the junk-bond shop led by Michael Milken that collapsed in a scandal. 

https://www.bloomberg.com/news/articles/2021-03-22/leon-black-steps-down-as-apollo-ceo-succeeded-by-marc-rowan

Apollo took Diamond Resorts private in 2016 for $2.2 billion and made a bid to buy Hilton Grand Vacations three years later for about $40 a share. 

https://www.bloomberg.com/news/articles/2021-03-22/leon-black-steps-down-as-apollo-ceo-succeeded-by-marc-rowan

In 2018 – Private-equity firm Apollo Global Management LLC is preparing to take Diamond Resorts public …. Apollo could seek a valuation for Diamond Resorts of around $4 billion and aim to raise in excess of $500 million in the offering, though price expectations are moving around, according to people familiar with the process.

https://www.wsj.com/articles/apollo-plans-to-take-diamond-resorts-public-1524222000

HGV, spun out of Hilton Worldwide in 2017, will buy the Las Vegas-based Diamond Resorts (for $1.4 billion) from funds managed by affiliates of Apollo Global Management Inc., Reverence Capital Partners and others in an all-stock deal.

https://www.streetinsider.com/General+News/Hilton+Grand+Vacations+to+buy+Diamond+Resorts+International+for+about+%241.4+billion/18106449.html?classic=1&fbclid=IwAR138X7CdWS5ffgQB154da07xYABd9pJCmAhgueJ-UzRun8uHFx7FH3puXU

Private Equity v Hedge Funds (Investopedia)

Private equity funds more closely resemble venture capital firms in that they invest directly in companies, primarily by purchasing private companies, although they sometimes seek to acquire controlling interest in publicly traded companies through stock purchases. They frequently use leveraged buyouts to acquire financially distressed companies. Once they acquire or control interest in a company, private equity funds look to improve the company through management changes, streamlining operations or expansion, with the eventual goal of selling the company for a profit, either privately or through an initial public offering in a stock market. 

History Repeats Itself

The first Diamond member to submit an article about their timeshare experience to Inside Timeshare was in 2016. A family of five, with their firstborn off to college, they alleged that they were told if they became Platinum they could offset maintenance fees. The most recent Inside Timeshare article is about a Diamond member who received a $95,678 judgement contesting a $3,995 Sampler trial product. He alleged that he was told he could offset maintenance fees at $.20 per point by charging purchases to a Diamond Barclaycard.  

https://insidetimeshare.com/fridays-letter-from-america-73/

Many Diamond members have reported that they were told that if they did not give up their deed their heirs would be liable for the timeshare. There have been 157 Platinum members who have reported allegations that they were promised the ability to be relieved of maintenance fees, unlock equity, or be able to sell points if they became Platinum loyalty level or bought additional points. 

Do your timeshare math when purchasing a timeshare or upgrading.  Seniors especially need to amortize the buy-in price over their expected lifetime to determine if the outlay is worth the price.   

Thank you, Irene, as usual, you have given us much to think about, let us hope the industry itself wakes up and take notes from what their own members are saying.

Join us again next week as we explore and report on the murky world of timeshare, have a great weekend.

More Breaking News

On Monday Inside Timeshare will be publishing the latest on the Cazorla Group, the majority shareholders of Anfi, it has been announced that the courts have declared the Cazorla Group bankrupt.

Thursday Round Up Plus a Peek at Tomorrow

Today we have a quick round-up of the news this week, tomorrow we welcome back Irene Parker to Friday’s Letter from America slot, we also remind you of another You and Yours program on MacDonald Resorts going on air tomorrow, but more of that shortly. We begin with our round-up of this week so far.

On Monday, we brought you another “Nightmare on Timeshare Street” involving MacDonald Resorts. This story involves another reader who is currently experiencing the full wrath of MacDonald’s use of the law.

He is at his wits end, he feels he has nowhere to turn and is unable to get the legal help he needs due to cost. Once again, we see the bullying tactics of the timeshare companies against the most vulnerable and the law allows it.

This I personally believe is criminality in itself, a form of legalised extortion, tactics the Godfather Don Corleone would love!

Following that story we brought you news of cases heard in the High Courts, these involved two Anfi and one Silverpoint.

As usual with cases involving Anfi, they did not accept the rulings of the Court of First Instance and immediately lodged an appeal with the High Court of Las Palmas. It is something the lawyers and Inside Timeshare has come to expect in every case.

The High Court as they have done in every previous case has upheld the lower court’s decision and denied the appeal returning it back for the execution of sentence.

Silverpoint did the same thing in Tenerife, they appealed to the High Court of Santa Cruz, once again that court dismissed the appeal and upheld the original sentence. In this case, it has now been lodged with the Mercantile Court for the execution of sentence due to the liquidation process.

Tuesday it was once again Anfi in the frame, this time with the Supreme Court.

They lost at the Court of First Instance, then lost at the High Court, so decided in their wonderful wisdom to appeal to Spain’s Highest Court!

Yes, you guessed it, they lost!

We do have to ask the question, yet again: Why do they continue on this course of action?

Yesterday, we published information on a new company that has come to our attention, Theodora Consulting Ltd.

At present we don’t have that much information, but what we did publish certainly gives cause for concern.

Tomorrow we welcome Back Irene Parker with her Letter from America, which covers the ongoing news of the Hilton acquisition of Diamond Resorts. Irene has spent a great deal of time and effort in researching this article, Inside Timeshare is proud to welcome her back with such an important subject for Diamond members.

Following on from our MacDonald Resorts article, tomorrow at 12:20 pm on BBC Radio 4, the consumer affairs program You and Yours will be highlighting the stories of our readers over the past week or so.

Inside Timeshare will be listening to the broadcast and we hope you will be able to find the time to listen as well. For members of MacDonald Resorts, this is a very important item and will show you that you are not alone.

That is all for today, please do join us tomorrow for Irene’s article and do tune in to Radio 4 at 12.20 pm.

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Hilton Acquisitions by Irene Parker
Broadcast on MacDonald Resorts