How Timeshares Work

Avoiding Timeshare Scams

Some timeshare brokers offer great prizes just for sitting through a "short presentation," which turns out to be a very long, very aggressive sales pitch.
2009 HowStuffWorks

Most timeshare offers ­are legitimate, but enough scams and shady deals have lured people in that timeshares have developed a bad reputation. Some timesh­are brokers also use hard-sell tactics and other practices that aren't necessarily illegal but are definitely unethical.

The first thing to watch out for is the sales pitch. Sellers often encourage people to stay for one of their sales presentations by offering extravagant prizes if they just stay for the entire pitch. Free vacations, cash rebates or new cars have all been offered. It pays to read the fine print, because often the free gifts aren't what they seem, or you will actually have to pay some kind of fee to qualify to win. There have been reported cases in which a free boat that was offered as a prize turned out to be a toy boat. Sometimes, people who already own a timeshare are convinced to buy another one with promises that their old one will be easily resold, when in fact the broker has no intention of selling the old timeshare.


Hard-sell tactics are easy to spot if you know what to look for, and that makes it much easier to resist. The broker may suggest a very attractive discount, but only if you sign a contract right now. The broker might attack your pride by suggesting that you "apparently aren't the right kind of person for this deal." The key to avoiding bad deals is to never make an impulsive decision. No matter how good the offer looks, never sign anything on the spot. Take the information home with you. Read the contract. Better yet, have a lawyer read the contract. Get the name and phone number of someone at the broker's company who you can call with questions. Weigh the costs -- and make sure they're disclosing all of them. Ask if you can visit the property you're buying -- it's not a good idea to spend thousands of dollars on something sight unseen. Photographs in a glossy brochure don't count.

Sometimes, new timeshare units are sold before the property has been built. If the financing for the construction falls through, it might never be built. Use an escrow service to hold your money until you're sure everything is in order.

If a property is poorly maintained, it won't be much fun to visit each year, so make sure there are terms in the contract outlining exactly what maintenance the resort will take care of. If they cut corners on upkeep, you'll have legal rights if they've violated the terms of the contract. If it isn't in writing, you might be out of luck.

For more information on timeshares and related topics, check out the links below.

Related HowStuffWorks Articles

More Great Links


  • BBB, "Timeshare Sales and Resales."
  •, "Timeshare Scams."
  • FTC, "Time and Time Again: Buying and Selling Timeshares and Vacation Plans."
  • FTC, "Timeshare Tips."
  • Holiday Group, "Glossary of Timeshare Terms."