South Carolina Timeshare Foreclosure and Right to Cancel Laws

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 within a few days, usually three to ten days. In South Carolina, the cooling-off period is five days.

But if you don't cancel the purchase by the deadline and eventually stop making mortgage payments or quit paying your timeshare fees, you could lose the timeshare to a foreclosure or repossession, depending on what kind of timeshare you own.

How Many Days Do I Get to Cancel a Timeshare in South Carolina?

In South Carolina, if you buy a timeshare, you can cancel the contract within five days from the later of:

• the date you sign the contract, not including Sunday if that is the fifth day or
• the date you receive the disclosure agreement pursuant to section 27-32-100 (see below). (S.C. Code § 27-32-40).

South Carolina law also provides the right to cancel a timeshare contract if, at any time, the timeshare or facilities as described in the contract are no longer available and the resort is unable to provide you with comparable accommodations or facilities. (S.C. Code § 27-32-40).

The right of cancellation can't be waived.

How Can I Cancel a South Carolina Timeshare Contract?

If you want to cancel the purchase contract, you must notify the seller in writing by sending notice via certified mail, return receipt requested, or another verifiable means. The notice of cancellation is considered given on the date postmarked so long as the notice is actually received by the seller. (S.C. Code § 27-32-40).

If you give notice in writing and transmit it other than by mail, the notice is considered given at the time of delivery at the seller's address as identified on the contract. (S.C. Code § 27-32-40).

Can I Get a Refund If I Cancel My South Carolina Timeshare?

If you cancel and haven't received benefits pursuant to the contract, the seller of the timeshare must refund your payment within 20 days after it receives your notice of cancellation. If you received benefits pursuant to the contract, the seller must refund your money, less the benefits received, within 30 days. (S.C. Code § 27-32-60).

Disclosure Agreement and Public Offering Statement for South Carolina Timeshares

A timeshare seller must provide the prospective purchaser with a written public offering statement regarding the purchaser's rights and obligations associated with the purchase of an interest in that vacation timesharing plan. The purchaser must receive the statement before signing a purchase contract, and the statement must include, among other things:

• the name and address of the seller
• a brief description of the interest being offered in the vacation timesharing plan
• the name of a person with the right to alter, amend, or add charges which the purchaser must pay (and the terms and conditions under which those charges may be imposed)
• a description of provisions to protect the purchaser's interest from loss due to foreclosure on an underlying financial obligation of the vacation timesharing plan, and
• a statement similar to the following: "You should purchase a timesharing interest as a vacation experience and for your personal use and enjoyment. You should not purchase a timesharing interest as an investment or for profit upon its rental or resale." (S.C. Code § 27-32-100).

Other Protections for Timeshare Purchasers Under South Carolina Law

Timeshare salespeople are known for using hard-sell tactics and misrepresentations to get you to make a snap decision about buying a timeshare. South Carolina law also protects you in timeshare sale transactions. For example, South Carolina law makes it illegal for a timeshare seller to use fraud, misrepresentation, or to fail to disclose material facts to induce a timeshare sale. (S.C. Code § 27-32-110).

South Carolina timeshare law also prohibits a developer or salesperson from using false or misleading advertisements to sell timeshares. (S.C. Code § 27-32-190).

How Do Timeshare Foreclosures in South Carolina Work?

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. (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.)

Also, timeshare owners typically pay annual maintenance fees and special assessments to their homeowners' association (HOA.) If, as an owner, you don't pay the fees and assessments, the HOA might sue you for money or foreclose your timeshare.

In South Carolina, residential foreclosures are judicial, but state law allows the nonjudicial foreclosure of mortgages and assessment liens for timeshare properties. (S.C. Code § 27-32-325).

Deficiency Judgments in South Carolina Timeshare Foreclosures

When a lender forecloses a mortgage taken out to buy a timeshare, the borrower's total debt sometimes exceeds the foreclosure sale price. The difference between the sale price and the total debt is called a "deficiency."

Example. Say you take out a mortgage loan to buy a timeshare. The total amount you owe on the timeshare loan is $15,000, but the timeshare sells for $10,000 at a foreclosure sale after you stop making the required mortgage payments. The deficiency is $5,000.

In some states, the lender may get a deficiency judgment (a personal judgment) against the borrower for the deficiency amount. Whether you'll face a deficiency judgment after a timeshare foreclosure depends on state law.

In South Carolina, the borrower doesn't have to pay a deficiency judgment after a nonjudicial timeshare foreclosure, even if the proceeds from the sale of the timeshare are insufficient to cover the debt. (S.C. Code § 27-32-320).

Ways to Avoid a Timeshare Foreclosure in South Carolina

A few of the various options to avoid a timeshare foreclosure include:

• selling the timeshare
• donating the timeshare to a charity (not all charities will take a timeshare, but some might, and you'll have to get current on payments first)
• negotiating with the resort to reduce the amount you owe
• arranging a repayment plan, or
• working out a deal to give the timeshare back to the resort (called a "deed in lieu of foreclosure" or "deedback").

Unfortunately, if you own a timeshare and don't want it anymore, you could have issues getting rid of it. Selling or donating a timeshare or completing a deedback are often difficult to accomplish. You might have better luck working out a settlement with the developer. Talk to an attorney to learn more or get assistance in working out a resolution to avoid a timeshare foreclosure.

Talk to a Lawyer About Your South Carolina Timeshare

If you want more information about timeshare laws in South Carolina 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.