If you recently bought a timeshare and regret that decision, you might be able to cancel the contract. But you'll need to act quickly. The amount of time you have to cancel the purchase—called the "rescission period"—depends on state law. Usually, you have only a few days.
Read on to learn more about the right to cancel a timeshare purchase and how to back out of a timeshare deal.
The vast majority of timeshare purchasers get the right to rescind the contract within a specific amount of time. Most states (and some foreign countries) have laws giving timeshare buyers at least a few days—usually between three and fifteen—to cancel the agreement.
In Colorado, for instance, a purchaser has up to five calendar days after the sale to rescind a timeshare contract. (Colo. Rev. Stat. § 6-1-703). Under Nevada law, timeshare purchasers get the right to cancel a timeshare contract until midnight of the fifth calendar day following the date the contract was executed. (Nev. Rev. Stat. § 119A.410). (Keep in mind that statutes change, so checking them is always a good idea.)
State law also often requires that information about the right to cancel be included in the contract. The right to cancel is typically nonwaivable, which means that the seller can't ask or require you to give up this right.
Most of the time, you must send your cancellation in writing. Even if the law allows you to cancel the contract orally, it's a good idea to prepare and send a timeshare letter of cancellation to the seller.
A cancellation letter should typically include the following information:
While it's usually not necessary to provide a reason for canceling the timeshare contract, you do need to explicitly state that the purpose of the letter is to rescind the contract. A statement like "I am contacting you within the rescission period to cancel this timeshare contract" will usually work. Be aware that state law might provide specific information you have to include in your cancellation notice.
The method by which you should deliver the cancellation is usually set out by state law. Or the timeshare contract itself might provide instructions. Some timeshare companies allow hand-delivery of a cancellation notice. Others accept delivery only via registered or certified mail. Be sure to follow the instructions exactly and make sure the letter is delivered within the applicable rescission period; otherwise, your cancellation might not count.
If the rescission period has passed and you want to unload your timeshare, you'll probably have to sell it to a new owner rather than get a refund. (Though, be sure to watch out for resale scams.) Under limited circumstances, though, state law might give you the right to get out of a timeshare contract after the rescission period has expired.
In Arkansas, for instance, a buyer has five days to cancel a timeshare contract after execution of the contract of sale or up until receipt of the public offering statement. (Ark. Code Ann. § 18-14-409). But the purchaser may bring a lawsuit in court within four years to rescind the contract if there is a question about the accuracy of the public offering statement or validity of the timeshare contract. (Ark. Code Ann. § 18-14-403).
It's critical to understand all of your rights when purchasing a timeshare. If you sign a timeshare contract early in your vacation, the rescission period could very well expire before you even get home. To avoid missing the window of opportunity for cancelling the contract, be sure to read all of the terms of the contract at the time you purchase the timeshare. Most timeshare laws require the seller to include information in the contract about how long you have to cancel the deal, as well as the procedures for delivering a cancellation letter. But a timeshare seller might bury these details in the paperwork or the instructions might be confusing. To protect yourself, you should be familiar with timeshare laws before you sign the agreement.
To verify how much time you have to cancel a timeshare contract—and the specific procedures you need to follow—consider talking to a consumer protection attorney or timeshare attorney in the state where the timeshare is located. If you buy a timeshare abroad and want to learn about your cancellation rights, consult with an attorney or consumer protection agency in that country.