The Top Ten Tricks That Timeshares Pull (By Tom Heehler)

Trick #2: Get customers to pay off their timeshare mortgage before they figure out they've been taken

Timeshares know that a certain percentage of customers will eventually figure out that they can negotiate out of their contract by using a law firm or an agency such as Resolution. That's why timeshares use a couple of sneaky tricks to get as much money as possible from their customers as quickly as possible. One such trick involves the interest rate charged. Usually it's pretty damn high. I'm talking anywhere from between 13% to 22%. This interest-rate strategy encourages customers to transfer their high-interest timeshare debt over to a lower-interest bank loan, which pays off the timeshare instantly. Once the timeshare has been paid off, it doesn't really matter if the customer figures out how to cancel their timeshare contract, because the timeshare already has its money. What's more, those customers who are unable to refinance, and who never realize the extent to which they've been deceived, will pay dramatically more money to the timeshare over a ten-year period, often more than twice the original purchase price.

A second strategy involves having the customer open a new credit card with a third-party provider such as Barclays, and putting the down payment (or even the entire amount) on that credit card. Often the customer is made to believe that the new credit card is issued by the timeshare itself, when it is actually a third party credit card. Once the timeshare debt has been transferred to the card, the timeshare is paid off entirely, and will feel little to no pain when the customer eventually figures out how to escape the contractual obligation.