How to avoid falling victim to a timeshare scam

Getting out of a timeshare can be tough and scammers try to take advantage of owners who are desperate to sell. Here’s how to spot a timeshare scam.

A timeshare allows multiple owners to use the same vacation property at different allotted times throughout the year. Typically, timeshare properties are located in desirable vacation destinations, like Florida or Mexico.

On March 2, eight timeshare companies based in Mexico faced penalties from the United States government for defrauding American timeshare owners and funneling the profits to a drug cartel. But timeshare scams have existed long before the recent ties to organized crime.

For instance, some scammers prey on timeshare owners who are desperately trying to sell their properties. Here are some tips on how to avoid falling victim to a timeshare scam.



In the U.S., nearly 10 million households own a timeshare, and the average price of most timeshare properties is more than $24,000, plus annual fees, according to the American Resort Development Association.

When a timeshare owner wants to sell their property, they often only get a third of what they originally paid in the resale market, says on its website. This reality gives scammers an opportunity to trick owners who are seeking to sell their properties by offering them a price that may be significantly higher than the property is actually worth.

How timeshare scams work

There are many different types of timeshare scams. But the FBI, U.S. Securities and Exchange Commission and the U.S. Department of Treasury all say these schemes typically involve fraudsters who make unsolicited contact with timeshare owners and claim to be representatives of a brokerage firm, travel agency or title company in order to steal money or personal information.

Some scammers promise to pay timeshare owners a significant sum of money for their property, but that never happens. Or, they may pretend to be a legitimate company by providing very official looking documents, including contracts and title paperwork, in an effort to scam timeshare owners.

Some companies take advantage of owners by posting fake timeshare resale ads that exaggerate or flat-out lie about what they can do to help.

“Be careful — these could be ads from timeshare resale scammers who will take your money, but won’t help you sell your timeshare. The truth is, the timeshare market is overcrowded, and it can be hard, if not impossible, to sell a timeshare. And no one can guarantee a sale or big returns,” the Federal Trade Commission says on its website.

Other fraudsters design fake websites that may mimic the websites of real timeshare companies but contain false information, such as incorrect names for company representatives to fool people into doing business with them. While other scammers may claim owners are entitled to valuable shares of stock in connection with their timeshare and offer to liquidate the shares in exchange for a commission.

“In some situations, timeshare owners are told that, to obtain the promised payments, the owners must pay a tax or fee. The fraudsters may claim that, prior to receiving the money for your timeshare or stock, you need to open an account at a specified bank and make a deposit to fund the account. If you make the deposit, the fraudsters will likely devise additional reasons to demand money in advance of the closing, which never occurs,” the FBI and SEC said in a fraud alert.

How to avoid falling victim to a timeshare scam

If you receive a phone call, email, or other communication regarding your timeshare, you should keep the following warnings in mind:

  1. Be suspicious of any uninvited offers regarding your timeshare, particularly those that seem “too good to be true.”
  2. Be extremely cautious of anyone who requests that you pay money upfront in order to obtain funds or property to which they claim you are entitled. 
  3. Be skeptical of any request to wire money in connection to your timeshare. 
  4. Be wary of high-pressure demands and tactics, which are often indicative of scams in general.
  5. Be careful if someone claims they have been provided with a “special permit” from the SEC – there is no such thing. 
  6. Be wary of hiring lawyers recommended by third parties who make unsolicited offers, as they may not be impartial.
  7. Be aware of scammers who claim to have buyers ready to make unsolicited purchase offers to timeshare owners. 
  8. Trust your instincts. If a timeshare solicitor makes you uncomfortable or tells you something that does not sound right, do not continue communicating with them.

“Fraudsters sound convincing, are very responsive, send you authentic-looking paperwork, and sometimes create websites that look legitimate. If you do not know the person with whom you are doing business with, be extremely cautious and do extensive due diligence,” the FBI and SEC said.

Report a timeshare scam

If you believe you have fallen victim to a timeshare scam, you should immediately contact your timeshare company directly and report the incident to your state attorneys general or local law enforcement. You can also file a complaint with the FBI’s Internet Crime Complaint Center.

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