By Sheri in Minnesota and Debbie in North Carolina
Introduction by Irene Parker
Complaints about deceptive sales, and the resulting exit scams, are beginning to seem like a reality TV show. In the EU such scams are perpetrated by what they call “Claims” companies, promising the owner that they are entitled to an amount of money awarded by the courts. This con seems to have spread to the U.S. like a coronavirus variant.
Last week a Diamond Resorts member contacted me. They almost fell victim to a sophisticated crimeshare ring. The crooks promised the family thousands of dollars in restitution, informing them that because of a lawsuit filed against Diamond, and the resulting settlement, they were entitled to a payout of thousands of dollars. When the member asked the amount of the settlement, the caller informed her it was $800 million! The criminals gained their confidence in a classic racketeering play, gaining their confidence by getting them 50% of their money back a few months ago, recovering a small amount of money.
Racketeering: Your tires get slashed. The following week different people from the same group stop by and say they will offer protection from tire slashers, for a fee.
Now Hilton Grand Vacation owners are receiving the same type of call. As reported earlier this week, a post from the Diamond Resorts Hilton Grand Vacation Advocacy Facebook Group:
The “purpose” of the meeting is to “inform” members of a “Class Action” lawsuit against Hilton Grand Vacations, the reason is “breach of contract”, as Hilton offers weeks to non-members for “rent” when members cannot find availability.
After Inside Timeshare has received complaints from many who reported that they were sold on the ability to rent to offset loan payments and maintenance fees. Today Sheri and Debbie add their experiences. This makes twelve families who purchased to offset costs by renting. Sheri purchased from The Colonies at Williamsburg, part of Vacation Village. Debbie purchased from Hilton Grand Vacations.
Debbie received a call this week from an exit company that knew ALL her detailed information about her HGV purchase. They mentioned on the voicemail recording that they were calling concerning her upgrade. They knew her loan balance. Debbie thought the caller was from Hilton. When asked, the caller said the information they had obtained was public information. The caller added that there has been a high volume of complaints about misrepresentations. We have found Hilton Grand Vacations to be one of the more reputable timeshare companies. Hilton responded to Debbie’s report by saying that they will be looking into her concerns.
Our efforts are centred on consumer education. Given that now 14 families have reported that Westgate, Exploria, Vacation Village and Diamond Resorts sales agents also advised them to rent to offset costs, there is a pattern. There have been hundreds of complaints about renting and resale value since we began tracking complaints in 2016.
I spoke to professionals about the feasibility of renting to cover costs. They agreed no one should ever buy a timeshare counting on this. The market does not care what you paid for your timeshare or what your maintenance fees are. The price to rent is based on what the market will bear. A listing will grow cold if the week is overpriced and/or a low-demand vacation. There are professionals who can make money because they understand how to price the timeshare and the logistics of renting. They have time and more importantly, contacts. They are in the business of renting. The average consumer being sold that concept is generally not that person.
Judi Kozlowski is a licensed timeshare resale broker with ReMax Properties SW in Orlando, Florida. She is a REMAX real estate agent devoted exclusively to timeshare resales. I asked Judi if people should buy a timeshare counting on the ability to rent out their unit to cover maintenance fees and/or loan payments. According to Judi,
“It is absolutely not feasible to sell a timeshare based on the ability to rent to cover the cost of the timeshare. It is selling timeshare as an investment and it is against the law in Florida to do so. It is also against the rules of most of the Developers to rent what you don’t own. With Hilton and Marriott you must rent the deeded time period you own and nothing more. It must be at the home resort you own in as well. So you can’t buy Orlando and rent in Hawaii. Developers are canceling reservations made outside of what the Seller’s ownership is. You can’t rent RCI weeks. That is one of the biggest scams around right now. We just reported an HGV sales person in Orlando that promoted the leasing of the unit so that they would never pay a maintenance fee and could use the RCI weeks to vacation.”
I also reached out to our friends at KOALA, a premier timeshare rental platform. Sheri mentioned in her report that she had attempted to rent through Koala, AirBNB and other sites. Not only did co-founder Mike Kennedy offer his take on the subject, but he also spoke to Sheri and looked into why her Colonies week did not rent. Mike, a former timeshare sales agent, agreed that buying a timeshare counting on renting to cover the cost is not appropriate. According to Mike,
“KOALA’s marketplace is successful because we focus on getting results — not empty promises or setting false expectations to coerce them into paying exorbitant upfront fees. In fact, they pay zero upfront fees. As a result, we don’t get paid unless the owner does. Think about how that changes the DNA of the company they’re working with.”
We will expand upon Mike’s comments next week to learn more about why KOALA became an instantaneous success. This interview with co-founders Mike Kennedy and James Burbridge talks about renting logistics and pricing:
May 11, 2022 update
My husband and I upgraded our Hilton Grand Vacation week from an every-other-year week to an every-year week. We had the opportunity to speak to representatives at HGV to discuss our concerns, and to learn more about Hilton Grand Vacations. We are grateful that Hilton addressed our concerns. We will remain a Hilton Grand Vacation owner.
We purchased a 4 BR Colonies unit at Williamsburg week for $44,980 in June of 2019. The Colonies is a Vacation Village Resort. When we said we could not afford to buy because we owned a Westgate week, our Colonies sales agent, Jackie, gave us the name of her personal friend, Ed McGee, a real estate agent with Vacation Services International. She said that we could easily sell our Westgate timeshare to be able to afford to own at The Colonies. Jackie explained that selling our Westgate week and renting our Colonies unit would quickly pay off our debt. The information was “for our ears only.” “I’m not supposed to tell you this, but I have a personal friend who can sell your Westgate week,” Jackie explained. She said she owned two Colonies units, one to use and one to make extra money. She added that Ed could even rent the bonus Colonies week we were given with our purchase.
I contacted Ed McGee. On July 9, 2019 we paid him $199 for a listing to rent our Colonies week and $299 for a listing to sell our Westgate week. Not a thing came of it. Ed McGee listed our worthless Westgate unit for $39,000. I tried listing my timeshare weeks on social media, Air BNB, Koala, U Destinations, and Access Resort.
While the GM of The Colonies at Williamsburg, Mr Jim Bushey, was sympathetic, he explained that sales are a separate entity and we would have to speak to a sales manager. The sales manager was unconcerned, saying that we did not bring up renting at closing. Why would we? The closing goes over the terms of the contract.
I called Jackie about a year ago and told her that what she had recommended does not work. She showed no concern. Jackie can hardly deny she referred us to her personal friend. This offers proof that we experienced a bait and switch.
I will be filing a complaint with the Virginia Attorney General and the Virginia real estate ethics board. Jackie is a licensed real estate agent. It feels like Jackie and the sales manager at The Colonies stole $44,000 from our family.
Club Exploria filed a lawsuit against a law firm in which one of Club Exploria’s owners stated in court documents that a Club Exploria sales agent promised the ability to rent.
Nine Westgate owners reported that they were sold on the ability to rent. One military family bought a 4 BR Westgate unit advised to rent. They are a couple with a four year old, no way needing a 4 BR. Forced to default, the father’s security clearance is in jeopardy.
Benn Dover reported being sold a second Westgate 4 BR week advised to rent.
Benn launched a Westgate Timeshare Hostages Facebook Group.
Thank you to all who contributed to this article, especially Irene, Debbie and Sheri, over the years we have seen many deceptive tactics used by “Sales Agent” and one of the most disturbing factors is the age of many of the “victims”, they have been mainly seniors and many serving military or veterans. The selling of any timeshare with the pitch angling towards “investment” may not be illegal everywhere but is downright immoral, in Europe, it is totally illegal, hence the huge legal battles Silverpoint have been losing in the courts.
Have a good weekend, Baby Dog has been hiding under the cushions while waiting to begin his weekend fun, the look is all it takes.
Your comments are welcome, please place them on the relevant article, for further information or advice please use our contact page.