If you have purchased or are thinking of purchasing a timeshare in Texas or are facing a timeshare foreclosure in Texas, it’s important to learn the answers to the following questions:
Read on to find out some of the most important features of Texas timeshare law.
(Be sure to check out Nolo’s Buying or Selling a Timeshare and Timeshare Foreclosures topic areas where you can find information about selling or donating your timeshare, timeshare foreclosures, options to avoid a timeshare foreclosure, and consequences of a timeshare foreclosure.)
In Texas, you have the right to cancel a timeshare contract so long as you do it before the sixth day after the date:
The right to cancel cannot be waived. A contract containing a waiver of this right is voidable by the purchaser (Tex. Prop. Code Ann. § 221.041).
How to cancel the contract. To cancel the purchase contract, you may:
If you decide to cancel the contract, the developer must refund all payments you made before the cancellation:
(Learn more about cancelling a timeshare purchase in Nolo’s article How Do I Cancel a Timeshare Contract?)
The developer must provide a timeshare disclosure statement to you before you sign the timeshare agreement. The timeshare developer must also get you to sign an acknowledgement that you received the timeshare disclosure statement. (Tex. Prop. Code Ann. § 221.032).
The timeshare disclosure statement must include (among other things):
Texas law prohibits timeshare developers or salespeople from engaging in deceptive trade practices. The following acts, among others, constitute deceptive practices under the law:
If you take out a loan to purchase an interest in a deeded timeshare and fail to make your timeshare mortgage payments or keep up with the assessments, you will likely face foreclosure. (In addition to monthly mortgage payments, timeshare owners are ordinarily responsible for maintenance fees, special assessments, utilities, and taxes, collectively referred to as “assessments.” Find out more in Nolo’s article Can a Timeshare Be Foreclosed for Nonpayment of Fees or Assessments?)
In Texas, the foreclosure can be either judicial (meaning through the court system) or nonjudicial (which means the lender does not have to go through state court to get one).
Learn more about the Texas foreclosure process.
(To learn more about the difference between judicial and nonjudicial foreclosure, and the procedures for each, visit Nolo's Judicial v. Nonjudicial Foreclosure page.)
The laws that govern Texas timeshares are found in Chapter 221 (the “Texas Timeshare Act”) of the Texas Property Code. You can access the Texas statutes by going to www.statutes.legis.state.tx.us and selecting “Property Code” and “Chapter 221” from the drop-down menu and then clicking on “Go.”
(For general articles on foreclosure in Texas, visit our Texas Foreclosure Law Center.)