Deed-Backs

[JLB Please excuse me, I'm a Dick. Not a moron just a Dick Find all posts View Profile Close JLB]

Why do you suppose timeshares, whether developers or associations or whatever, do not take weeks back (for free)?

[Jya-Ning Silver Contributor Find all posts View Profile Close Jya-Ning]

Add sell cost and MF, most of the deed back are more costly to handle.

Jya-Ning

[mshatty Super Moderator Find all posts View Profile Close mshatty]

Why do you suppose timeshares, whether developers or associations or whatever, do not take weeks back (for free)?

Eliminates owners to pay MF's.

[rikkis_playpen Diamond Club Contributor Find all posts View Profile Close rikkis_playpen]

The association does not have an effective means to sell or rent the "returned" ownerships and thereby monetize the inventory in a manner to offset the loss of maintenance fees.

However, pushing these owners into foreclosure doesn't make any sense either unless the association can find some way to monetize this process. Why spend money taking a property back, when the owner will give it to you for free? Is it really worth the legal cost just to try and scare other owners in the hope they won't also default?

Why a developer with an active sales force does not take it back is anyone's guess..

Seems to me it would make much more sense for the developer to accept the ownership back and push it back into developer inventory than to have owners attempting to sell the same interval on eBay for $1. What is more detrimental- adding a maintenance fee (for those developers who actually pay for their share) or having a possible buyer look on eBay and see your resorts offered there for pocket change?

[gandalf252002 Senior Member Find all posts View Profile Close gandalf252002]

I have to agree with Rikki on this one. Yes, they might loose the residual MF's let us say $1000 a year for round numbers. With many TS's being sold at $10,000 or more through the developer’s they could take, 7 or 8 years to sell it (have to take into account he time value).

This of course ONLY applies to developers who still have an active sales force. Then you have to take into account other costs such as marketing, sales people's salaries, etc. There is a balancing act that must occur where the develop ways the cost / benefit of taking back a unit. How quickly can the re-sell them? Is their more inventory than necessary for the sales force?

No active sales force, makes it only that much more difficult for the association to take deed backs. I concur though it makes more sense to simply take back a deed, rather than go through the costly legal battle of foreclosing.

You know the old saying; “you can't bleed money from a stone.”

My suggestion would be for the developers and associations to do essentially what the PC companies are doing. For a fee of say 3 years MF's they will take the deed back. This is essentially a win-win for both. It would rid the client of the “perpetual” burden, and the developer some of the burden of trying to re-sell it.

You can correct me if I am wrong; the up-front fees are not really the big issue with these companies. It is the fact they do not deliver what they sell, and what the customer is paying for, the end to the MF’s.

We know the market is crap, and that it is difficult to sell or even give away a timeshare. For those who see no other option, or for convenience chose this route, this provides that when the companies deliver what they promise.

[JLB Please excuse me, I'm a Dick. Not a moron just a Dick Find all posts View Profile Close JLB]

I wanted a few responses, so as to not influence the discussion, but, does anyone think it is because they are afraid of what might happen if they did?

[tonyg Goomba & Super Moderator Find all posts View Profile Close tonyg]

Perhaps. I know of one resort with no active sales staff that takes deed backs, if the unit is paid off and the mf's are payed a year in advance, and has announced that to it's owners. I'll have to inquire as to how that is going and get back to this thread. Unsold inventory does not generate revenue (unless rented), but it does not incur as much expense as an occupied unit does. Taking back desirable weeks and reselling them(in a timely manner) would be a plus for HOA finances.

[JLB Please excuse me, I'm a Dick. Not a moron just a Dick Find all posts View Profile Close JLB]

I wanted a few responses, so as to not influence the discussion, but, does anyone think it is because they are afraid of what might happen if they did?

Same question.

[odaddy Gold Contributor Find all posts View Profile Close odaddy]

I have a resort I own at that has unlimited day use year round regardless of season you own, they could easily give deeds away to the locals, who could use 3 pools 3 fintess centers indoor pool during winter and owner rates at 3 golf courses , they could groupon the memberships for 1 years dues easily, and yet they wont take deedbacks, lose 3 years of dues then pay another equivalent of 4 years in dues to foreclose, madness!

They also have sent letters to many owners offering to take deed backs before they foreclose and only 1 in 10 responds. Even when they try to take a deedback they cant. Weird?

[JLB Please excuse me, I'm a Dick. Not a moron just a Dick Find all posts View Profile Close JLB]

I have a resort I own at that has unlimited day use year round regardless of season you own, they could easily give deeds away to the locals, who could use 3 pools 3 fintess centers indoor pool during winter and owner rates at 3 golf courses , they could groupon the memberships for 1 years dues easily, and yet they wont take deedbacks, lose 3 years of dues then pay another equivalent of 4 years in dues to foreclose, madness!

Three of our weeks are similar. One for us and two for resale to locals who do not live in the development. About a third of golf league own in these TSs "for golf". They used to resell for $7500, sorta a gentlemen's agreement among owners, but with the recession the market has dried up.

[Carolinian Super Moderator Find all posts View Profile Close Carolinian]

All three of the resorts I own at, which are located in three different countries, and which are all run by member-controlled HOA's, take deedbacks. None of them advertises that fact, for obvious reasons, but all take them if a member calls and asks.

As a former HOA board member and president, I agree that foreclosure is more costly than taking a deedback, and any thinking HOA avoids it.

[ttt Member Find all posts View Profile Close ttt]

Sometimes it may be an accounting issue:
Unpaid & uncollected maint. fees remain on the books as an asset. Association owned weeks are on the books as a liability as the association is responsible for the fees for owned weeks.
I'm not an accountant, does this make sense? I remember hearing this years ago when I was working with several resorts to liquidate their inventory...

[rikkis_playpen Diamond Club Contributor Find all posts View Profile Close rikkis_playpen]

This is being implemented, although it is rare..

There are a handful of resorts that are now doing this. Again though, it all depends on the association being able to create some type of program to monetize these intervals.

It's a step in the right direction though.. After all, why have your owner pay thousands to PCC who will likely just turn around and drop the week in your lap two years later via foreclosure.

The part that really seems bizarre to me, are the associations and developers who either allow the PCC's to deedback or in some cases even purchase the weeks back from the PCC.. Why allow your owners to pay thousands to a PCC if you plan on taking the week back anyway?

Visit Disclaimer

Type the name VIN WG into the grantor search field..

At first glance it may appear these are ROFR decisions when the PCC tries to take ownership from the original owner- but if that was the case the deed should show the owner's name as the grantor and not the PCC.. This appears that the developer allowed the transfer to the PCC to occur, then stepped in and took the week.

My suggestion would be for the developers and associations to do essentially what the PC companies are doing. For a fee of say 3 years MF's they will take the deed back. This is essentially a win-win for both. It would rid the client of the “perpetual” burden, and the developer some of the burden of trying to re-sell it.

[JLB Please excuse me, I'm a Dick. Not a moron just a Dick Find all posts View Profile Close JLB]

Again, since the overwhelming majority of the industry does not take weeks back, do you think it is because they are afraid of what it might start?

[Carolinian Super Moderator Find all posts View Profile Close Carolinian]

Most of those which do take deedbacks may it a point not to advertise that fact. A member has to make an inquiry to find out.