Originally posted by: Citrix
Timeshares are a ripoff period.
Not really. There are several caveats.
1. Don't buy directly from the developer. Most "good" timeshare brands (Starwood, Marriott, Wyndham) can be found on Ebay for 35% of the price. Most recently I was in Maui and went to a Starwood presentation for a very nice resort. They pitched it at 60k. After we were done I went back to the hotel room and found the same point package at the same "home" resort for 20k.
Developer costs are ony about 35%. The remainder are comissions for the sales people and marketing with profits of ~10%.
2. Don't finance through the timeshare company. The lowest rates are typically 9.99%, if you can get a HELOC, or pay cash outright, it's a far better deal.
Typically, the people they "get" are people who buy on the spur, those who don't know the "full" story, or those who can't arrange cheaper financing.
3. Find a resort where you don't have to pay property taxes on your "fractional". This will save you a lot of money.
4. Buy with a company with many resorts, such as Marriott, Wyndham, Starwood, or Bluegreen. That way they have internal exchange points.
Overall, timeshares aren't horrible purchases, if done correctly. They get a bad name for people not being smart, but that's the same as any other item you purchase. It's certainly not for everybody (nor for me), especially if you like to travel around, like where there may not be an internal exchange.
However, for people who are smart it can be a great buy. Many of the new lines of timeshare a pretty damn nice, the Wyndham Presidential Club is *very* nice, far better than a hotel in many respects, and can be well worth the money. If you really like a destination and/or internal exchange program they can work reasonably well.