Is a Timeshare Worth Buying?

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The idea of owning a timeshare may sound appealing, but don't let your dreams of a vacation home and tropical getaway cloud your vision. Purchasing a timeshare constitutes a very big financial commitment -- one that can be difficult to obtain financing for if you don't have the cash on hand -- and the last thing you want is for your vacation dream to turn into a nightmare. When trying to decide if you should buy a timeshare, ask yourself -- and the timeshare agent -- several specific questions that can help you determine whether it's worth it.

What Kind of Timeshare Is It?

The only "true" way to buy a timeshare is if it's offered as a deeded ownership. That means you receive actual ownership of the property -- or, more often, partial ownership -- that you can sometimes even pass on to your beneficiaries. The two other common forms of timeshares are the right-to-use system and the points system. In the former, you purchase the right to use a resort a certain number of times over the course of a pre-determined period. In the latter, you purchase points that you can redeem for vacation time at various resorts. Neither two options are truly methods of buying a timeshare, though agents may market them as such.

Is the Developer and Management Company in Good Health?

The last thing you want is partial or full ownership of a timeshare in a resort that goes belly up. This can either destroy the value of your investment or, if another company purchases the resort, may change how you're able to use the timeshare. Before you buy into the resort, research the track record of the management company and the timeshare developer. This can include consulting local real estate agents to get their perceptions of the company; checking to see if other properties owned or managed by the companies have recently closed or filed for bankruptcy; and asking for a copy of the resort's operating budget and projections.

How Much Is the Annual Maintenance Fee?

All timeshares require the owner to pay an annual maintenance fee. This can easily cost $400 or more. You'll have to pony up this expense whether you've used your timeshare or not, and it can turn into a significant cost over the years. Ask how much this fee is and make sure it's within your long-term budgeting goals.

What Amenities Are Offered?

When you own a timeshare, you generally get access to the resort's various amenities without paying resort prices -- a potentially significant advantage. Ask for a copy of the resort's various services and features. Things to keep an eye out for include transportation options, such as shuttles to nearby attractions; the number of swimming pools and hot tubs; proximity to beaches, hiking trails and other outdoor attractions; and in-room amenities, such as television and wireless Internet.

Is It a Resale?

Buying a timeshare in a resale event can net you major savings, because resale units sometimes go for 70 to 50 percent less than the original owner paid. If it's not a resale, you may wish to scour the market for such sales as a way to get the vacation unit you want at a price that gives your bank account a little vacation, too.

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