Beware salespeople’s big promises of profit from reselling time shares

As economic jitters filter down from Wall Street to Main Street, many people who own vacation time shares are considering resale as a means of securing ready cash. Dishonest companies or individuals are aware of this and, as has happened in past years, bogus sales programs are surfacing. So be very cautious if someone contacts you offering to resell your time share for a fee. Check the time share market with a reputable company to make sure the market for resale is good or you could lose your investment. A recent survey found that only 3.3 percent of owners reported reselling their time shares during the past 20 years, but during times of desperation many owners have been cheated by time share resale scams.

Unscrupulous companies may contact you by phone or mail. Salespeople are likely to tell you the market for resale is “hot” and that their company has a high success rate in reselling units. They may claim to have extensive lists of sales agents and potential buyers. For an advance “listing” fee, often $300 to $500, they promise to sell your time share for a price equal to or greater than your purchase price. To entice you further, they may offer a money-back guarantee, or an “up to $1,000” government bond if they can’t sell your time share for 80 percent to 90 percent of its appraised value, or if they don’t sell it within a specific time.

In reality, the market for resale may vary considerably depending on the location, time of year and other factors. The bogus solicitor’s “lists of sales agents and buyers” may consist of people who have never heard of the company or have no interest in buying a time share. It may be unlikely that the company can sell the time share at all, let alone for a price equal to or greater than your original purchase price. In addition, many owners who fell for this scam and whose time shares didn’t sell after a year have received a government bond worth only $60 or $70 from the company rather than the promised $1,000. Other time share owners were told after the fact that the company would offer no refund on the listing fee.

If you are considering resale of your time share and are approached by a company offering to broker, take these precautions:

. Don’t agree to anything over the phone until you check the company’s reputation.

. Insist that the salesperson send you written materials.

. Get a complete address: city, state and street (not a post office box) where it does business.

. Contact the state attorney general, Better Business Bureau and chamber of commerce in or nearest to the city where the sales agent is located.

. Determine if the company and-or its salespeople are licensed to sell real estate by the state in which your time share is located by contacting the state’s real estate licensing board.

Be wary of companies charging an advance “listing” fee for services. Consider opting for a company that offers to sell for a fee to be paid only AFTER the time share is sold.

You have several other resale options. You may try selling your time share yourself, by placing an ad in newspapers or magazines, or by contacting a real estate agent familiar with the area in which the time share is located. If all the time shares have been sold in your development, consider asking the seller to establish an on-site resale office.

No matter what else you do, always be certain to deal with established and well-known real estate agents and agencies that have a street address and are willing to have their legitimacy and reputation verified. If you encounter a sales agent who is unwilling to undergo reasonable scrutiny, show him or her the door.

Consumer Forum is a collaborative effort of the Bangor Daily News and Northeast COMBAT. Send questions to Consumer Forum, Bangor Daily News, P.O. Box 1329, Bangor 04402-1329. COMBAT is a nonprofit organization with annual dues of $10. For membership information, write to the above address.