A timeshare property can be a worthwhile investment if you fully understand its advantages while mitigating potential risks at the same time.
Foreclosure on a timeshare property serves as one risk; therefore, potential investors need to review the fine print before making any decision. It’s also a legally binding venture and not something that you can just exit when you feel it hasn’t served its purpose. The Law Offices of Susan M Budowski, LLC shares some insights on this type of investment.
Knowing the Risks
Foreclosed timeshare properties often happen due to defaulting on your payment obligations, which can affect your credit score. Costs such as maintenance fees can be unpredictable as well, so think about whether you can allot money for unexpected expenses.
Since they are difficult to sell, you should expect agents to be determined in hard selling a property. The risks involved in this type of scheme can be high if you give in to the promise of a weekly vacation in a beautiful resort. However, some people can make the most out of their timeshare by renting them out, but this requires careful planning.
Around 9.2 million households own one timeshare property possibly because of the low sale price, which can be $21,000 on average. Existing owners are easier to persuade than a first-time buyer, according to experts.
Despite the associated risks, the American Resort Development Association said that the timeshare industry has recorded $9.2 billion of net sales in 2016 from $4.63 billion in 2010. This indicates that many Americans may have enjoyed the benefits of a timeshare, only if they managed to avoid the risks.
Like any other investment, timeshare properties carry their own risk. It’s up to you if you feel that the pros outweigh the cons. One way to keep yourself from falling into a debt spiral is hiring a contract reviewer who would make sure the terms are fair and reasonable.