Maryland Timeshare Foreclosure and Right to Cancel Laws

Learn about Maryland timeshare foreclosure laws, right to cancel laws, and other timeshare contract laws.

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Maryland law provides quite a few protections for timeshare purchasers, such as making sure you get a copy of the public offering statement, providing a right to cancel a timeshare contract, and prohibiting timeshare developers from using advertisements that include false or misleading statements, among other things. But you still need to watch your step when purchasing a timeshare, and you should understand that if you don't make your timeshare mortgage or assessments payments, you may lose your timeshare through foreclosure.

Read on to learn about a few of the significant features of Maryland’s timeshare law.

Public Offering Statement

A public offering statement contains general information about the timeshare development and important matters that you should consider when acquiring a timeshare. If you buy a timeshare in Maryland, the timeshare developer (or the developer’s designated project broker) must deliver a public offering statement to you before transferring the timeshare and no later than the date of the contract (Md. Code Ann. Real Prop. § 11A-112).

The public offering statement must include, among other things, contact information for the developer, information about the timeshare project and timeshare units, copies of contracts and leases to be signed, information about timeshare expenses, financing (if offered), and fees, and information about how to cancel the contract. (Md. Code Ann. Real Prop. § 11A-112).

Your Right to Cancel a Timeshare Purchase in Maryland

In Maryland, you can cancel the timeshare purchase contract until midnight of the 10th calendar day following the later of:

  • the contract date
  • the day on which you received the last of all documents required to be provided as part of the public offering statement, or
  • the date the timeshare unit meets all building requirements and is ready for occupancy (Md. Code Ann. Real Prop. § 11A-114(a)).

The Right to Cancel Cannot Be Waived

The right of cancellation cannot be waived and the closing cannot occur until the cancellation period has expired (Md. Code Ann. Real Prop. § 11A-114(b)).

You can void the closing for a period of one year after the expiration of the cancellation period if the developer (or a representative of the developer):

  • tells you that you do not have a right of to cancel the contract
  • attempts to obtain a waiver of your cancellation rights from you, or
  • the closing occurs prior to the expiration of the cancellation period (Md. Code Ann. Real Prop. § 11A-114(b)).

How to Cancel a Maryland Timeshare Contract

You can cancel your timeshare purchase by sending written notice to the developer at the address provided in the contract (Md. Code Ann. Real Prop. § 11A-118). (See Nolo’s article on how to cancel a timeshare contract for more information on cancelling a timeshare purchase.)

Notice is considered given on the date postmarked, if mailed, or when transmitted from the place of origin, if telegraphed, so long as the notice is actually received by the developer (Md. Code Ann. Real Prop. § 11A-114(c)).

If notice is given by means of a writing transmitted in some manner other than by mail or telegraph, it is considered given when the developer receives the notice at it's principal place of business (Md. Code Ann. Real Prop. § 11A-114(c)).

Refunds

If you cancel, the developer must refund all payments you made (less any benefits you received) within:

  • 20 business days of your cancellation, or
  • five days after receiving funds from your cleared check, whichever is later (Md. Code Ann. Real Prop. § 11A-114(c)).

In addition, if the developer fails to provide you with a public offering statement before transferring the timeshare and you elect to cancel the contract, you are entitled to recover 110% of the sales price you paid (Md. Code Ann. Real Prop. § 11A-112).

Escrow Account Required in Timeshare Purchases

The timeshare developer must put any money you pay in connection with a timeshare purchase into an escrow account (Md. Code Ann. Real Prop. § 11A-116).

The funds must be released:

  • to you, if you cancel the agreement
  • to the developer, if you default in performing an obligation under the sales agreement, or
  • to the developer, after the closing (Md. Code Ann. Real Prop. § 11A-116).

Consumer Protections in Maryland

Timeshare salespeople are known for using hard-sell tactics and misrepresentations to get you to make a snap decision about buying a timeshare. Maryland law provides protections to shield timeshare purchasers from deceptive sales practices.

Advertising Regulation

Maryland law prohibits timeshare salespersons from using any false or misleading statements or advertising in connection with sale of a timeshare. For example, timeshare sellers cannot misrepresent the size, nature, extent, qualities, characteristics, or services of the timeshare project (Md. Code Ann. Real Prop. § 11A-119).

Real Estate License Required

In Maryland, all persons selling timeshares must be licensed real estate brokers (Md. Code Ann. Real Prop. § 11A-124).

Maryland Timeshare Foreclosures

In Maryland, if you fail to make your mortgage payments on a deeded timeshare, you will likely face foreclosure. In addition to monthly mortgage payments, timeshare owners are generally responsible for maintenance fees, special assessments, utilities, and taxes, collectively referred to as “assessments.” You will also likely face foreclosure if you fall behind in the timeshare assessments. (For more information on timeshare assessment foreclosures, see Nolo’s article Can Timeshares Be Foreclosed for Nonpayment of Fees and Assessments?)

How to Find Maryland’s Timeshare Laws

To find the statutes that govern timeshare transactions in Maryland, go to www.lexisnexis.com/hottopics/mdcode and look in the "Real Property" section of the Code of Maryland. Go to Title 11A to find the “Maryland Real Estate Time-Sharing Act.”

by: , Contributing Editor

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