It has been well known for a long time that Europe and the USA has had problems with timeshare, but consumers in Australia are also finding the same problems.
Pat McGrath a reporter for ABC News 7.30 covers the story of a young couple who were stopped in a shopping mall by an OPC, or timeshare tout with the ubiquitous scratch card, They were enticed to attend a presentation given by timeshare company Classic Holidays.
After being subjected to many hours of high pressure sales, even though they could not afford it, they eventually agreed to purchase. Not being able to afford it was not a problem, the representative of the “in-house” finance department was on hand and a finance agreement was made.
There were no real checks made as to whether the couple could actually afford the loan, which was for around Aus$21,000 at an interest rate of 15%.
As usual the promises made at the sales presentation did not materialise, one which the couple were enticed with was a 4 week trip to the US for Aus$4,000. Once the membership was received, they searched for the US trip, which was to be a dream holiday, the cost, Aus$8,000. A far cry from the price they were told at the presentation.
Eventually they managed to clear the loan, but were now saddled with the huge cost of maintenance fees. Which because of her contract lasting for 80 years she will be 110 years old before it ends.
The only option was to sell, but the young couple did not wish to burden someone else with the same problem. Their contract and membership has now been cancelled due to non payment of the maintenance fees, although happy with this they are inevitably very much out of pocket.
The same program also highlighted another timeshare problem, in this case it was sold as an investment, whereby the properties would be rented out giving the owners an income. Unfortunately these properties were taken over by Wyndham, and things have taken a downward turn.
The properties are badly maintained and becoming dilapidated, the grounds are overgrown and strewn with rubbish. One owner who brought in around Aus$7,000 a year in rental income now receives nothing after Wyndham takes out their management fees.
These are just two of the complaints that the Australian Securities and Investment Commission is receiving about this industry, they are now considering implementing tougher controls to regulate the industry.
You can see and read the full report on the following link.
If you would like further information on what can be done about any timeshare you have purchased then contact CLA International.