Virginia Timeshare Foreclosure and Right to Cancel Laws
Learn about Virginia timeshare foreclosure laws, right to cancel laws, and other timeshare contract laws.
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Virginia law provides consumers with a number of protections when it comes to timeshare transactions. For example, if you purchase a timeshare in Virginia and then want to back out of the deal, state law gives you the right to cancel the contract, but you only get a week to do so. Also, the timeshare developer must disclose certain information to you, including general information about the timeshare project, information about the timeshare exchange program (if there is one), and certain information about prizes and gifts (if they are offered as part of a timeshare advertisement).
Even though Virginia law provides quite a few protections for timeshare purchasers, you still need to be cautious 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 more about the most significant aspects of Virginia timeshare law.
Public Offering Statement
A public offering statement contains basic information about the timeshare development. In Virginia, the timeshare developer must provide you with a copy of the public offering statement before you sign the timeshare purchase contract (Va. Code Ann. § 55-374).
The public offering statement must disclose certain information about the timeshare to you, such as the developer's name and principal address, the name and address of the developer's agent for service of process, a copy of the annual budget for the project, and a statement that you have a non-waivable right of cancellation (Va. Code Ann. § 55-374).
Your Right to Cancel a Timeshare Contract in Virginia
Virginia law states that you may cancel a timeshare contract until midnight of the seventh calendar day after signing the contract. If the seventh calendar day falls on a Sunday or a legal holiday, then the right to cancel the contract expires on the day immediately following that Sunday or legal holiday (Va. Code Ann. § 55-376(A)).
How to Cancel a Timeshare Contract in Virginia
You can cancel the contract by either:
- hand-delivering the cancellation notice to the developer at its principal office or at the project (the resort), or
- mailing the cancellation notice by certified United States mail, return receipt requested, to the developer or its agent designated in the contract. The notice is considered effective as of the date postmarked (Va. Code Ann. § 55-376(B)). (Get more information about cancelling a timeshare purchase in Nolo’s article How Do I Cancel a Timeshare Contract?)
If you cancel, the developer cannot charge a penalty and must refund all of the money you paid within 45 days after receiving your notice of cancellation (Va. Code Ann. § 55-376(A)).
Disclosures Regarding Timeshare Exchange Programs
One of the common features of timesharing is the ability to exchange your timeshare week (or other designated period of time) for someone else’s.
In Virginia, a developer that offers an exchange program among timeshare owners must give certain disclosures to program participants including a statement of whether membership or participation in the program is voluntary or mandatory and that the purchaser's contract with the exchange company is a contract separate and distinct from the purchaser's contract with the developer, among other things (Va. Code Ann. § 55-374).
Disclosures Regarding Gifts and Prizes
Sometimes, timeshare sellers offer gifts or prizes to potential buyers to get them to attend a sales presentation. In Virginia, any timeshare advertisement that offers a gift or prize must disclose certain information such as the retail value of the prize, the odds of winning, the date the offer expires, and a statement that the offer is being made for the purpose of selling timeshares (Va. Code Ann. § 55-374.1).
Escrow Account Required in Timeshare Transactions
In Virginia, any deposit made in connection with the purchase or reservation of a timeshare must be held in escrow (Va. Code Ann. § 55-375).
The funds will be released:
- to you, if you decide to cancel the contract
- to the developer, if you default under the contract to purchase the timeshare, or
- to the developer, after the cancellation period expires (Va. Code Ann. § 55-375).
Virginia Timeshare Foreclosures
Timeshare purchasers sometimes take out a loan to finance their purchase of a timeshare. You should be aware that if you don't make your timeshare mortgage payments, you could lose your timeshare through a Virginia foreclosure (Learn more in Nolo’s article Timeshare Foreclosures.)
In addition to monthly mortgage payments, timeshare owners are ordinarily responsible for maintenance fees, special assessments, utilities, and taxes, collectively referred to as “assessments.” If you fail to keep up with the assessments, you will also likely face foreclosure. (Find out more in Nolo’s article Can a Timeshare Be Foreclosed for Nonpayment of Fees or Assessments?)
Virginia Timeshare Laws
The Virginia Real Estate Timeshare Act governs timeshare transactions in Virginia. To find the Virginia statutes that address timeshare transactions, go to http://leg1.state.va.us. Click on “Code of Virginia” and “Table of Contents.” Look in Title 55 (Property and Conveyances), Chapter 21.