Owning a timeshare can start as a dream vacation plan but can sometimes become a financial nightmare. Whether due to changing life circumstances or dissatisfaction with the timeshare, some owners want to escape the financial burden. When that happens, timeshare companies often employ a variety of collection tactics to ensure they get paid.
Timeshare companies usually start with constant phone calls and letters demanding payment. If that doesn’t work, they may escalate to reporting the delinquency to credit bureaus, affecting the owner’s credit score.
What about legal action and liens?
Timeshare companies may also take legal action against the owner, leading to wage garnishments or bank account levies. Additionally, they can place a lien on the property, making it difficult to sell or transfer until the debt is settled. In extreme cases, they might even initiate a foreclosure process on the timeshare property. These aggressive tactics can add significant stress to an already troubling situation.
Can bankruptcy alleviate the problem?
Filing for bankruptcy puts an automatic stay on all collection activities, including those from timeshare companies. The effectiveness of bankruptcy in terminating the timeshare contract varies depending on several factors. It is best to talk with an experienced bankruptcy attorney to weigh your options and discuss the best way to proceed.