If you buy a timeshare and regret it, most states have "cooling-off" laws. These laws let you get out of a timeshare contract if you act quickly, usually within three to ten days. In Alabama, the cooling-off period is five days.
Also, state law provides other protections for timeshare purchasers. For instance, Alabama law requires timeshare sellers to get a license and prohibits sellers from making misleading statements or being deceptive when trying to get you to buy a timeshare.
But you still need to be cautious when buying a timeshare. And you should understand that if you take out a mortgage loan to buy a deeded timeshare and stop making the payments, the lender, usually the resort developer, will probably foreclose.
In addition, timeshare owners typically must pay annual maintenance fees and special assessments. If, as an owner, you don't pay the fees and assessments, you might face a lawsuit for a money judgment or a foreclosure of your timeshare. (With a right-to-use timeshare, people generally sign a contract and agree to make monthly payments. While a developer may foreclose a deeded timeshare, a right-to-use timeshare is typically repossessed, which is a different legal process than a foreclosure.)
Again, you can cancel a timeshare purchase in Alabama within five days. If the fifth day is a Sunday, the deadline is extended to Monday as the fifth day. (In the case of a vacation time-sharing lease plan, you may also cancel the contract at any time if the accommodations or facilities are no longer available as provided in the contract.) (Ala. Code § 34-27-53.)
An Alabama timeshare purchase contract must contain specific information, including:
Also, a timeshare seller must give each prospective timeshare purchaser a copy of the public offering statement. A "public offering statement" has detailed information about the timeshare project and important matters to consider when buying a timeshare interest. (Ala. Code § 34-27-51.)
To cancel the contract, you must send notice to the seller in writing by certified mail, return receipt requested. (Ala. Code § 34-27-53.) It violates Alabama law for the seller to fail to honor a cancellation request. (Ala. Code § 34-27-54.)
If you cancel before receiving any benefits under the contract, the developer must give you a refund within 20 days after receiving the cancellation notice. If you received any benefits pursuant to the contract, the developer must give you the refund within 30 days, less the amount of any benefits you actually received. (Ala. Code § 34-27-55.)
Timeshare salespeople are known for using hard-sell tactics and misrepresentations to get you to make a quick decision about buying a timeshare. Alabama law protects timeshare buyers by requiring most timeshare sellers to have a license and prohibiting false statements and deceptive actions in timeshare sales.
Also, timeshare sellers sometimes offer gifts or prizes to get you to attend a sales presentation. Alabama law requires such sellers to make certain disclosures if using this kind of promotional device to sell timeshares.
Timeshare brokers and salespersons must be licensed in Alabama. (Ala. Code § 34-27-51.)
Alabama law prohibits timeshare sellers from using deceptive practices in timeshare sales, including:
Timeshare sellers are notorious for getting people to attend sales presentations by offering free gifts, prizes, or vacations. Alabama law prohibits the use of any promotional device (such as sweepstakes, lodging certificates, gift awards, premiums, or discounts) without fully disclosing:
In Alabama, if you take out a loan to purchase an interest in a deeded timeshare and fail to make your mortgage payments, the lender (again, typically, the developer) might foreclose.
In addition to monthly mortgage payments, timeshare owners are ordinarily responsible for maintenance fees, special assessments, utilities, and taxes, collectively referred to as "assessments." You might also face a foreclosure in Alabama if you fall behind in the timeshare assessments.
A few of the various options to avoid a timeshare foreclosure include:
If you want more information about timeshare laws in your state or need assistance canceling a timeshare, consider talking to a real estate attorney. Contact a foreclosure attorney if you're facing a timeshare foreclosure and have questions about the process or your options.
Need a lawyer? Start here.