Timeshare cooling off period

thewinelake66

We're quite keen on buying into a timeshare property in Madeira. So much so that we have signed the contract and paid the €1500 downpayment.

The way they do the downpayment is quite clever - they get you to book a stay at the hotel which is notionally free, so that money is still used towards the upfront payment on the timeshare. Then about 6 weeks later, the balance is due (in our case €5900).

We've now been made an offer by someone wishing to sell the remainder of their timeshare in the same property for a bargain price.

The contract states that there is a 14 day cooling off period that has expired (I think we're at about 17 days now) so my take is that we're obliged to pay the balance.
However, the salesman for the timeshare exchange seems to think that we can still walk away and all we'll lose is the €1500.

His suggestion is to say that we've got cold feet due to a change in circumstances (arguably true!) and we'd like to pull out and get a refund. He thinks that they might come back and say "we'll let you pull out of the main contract, but no chance of a refund, and we'll void that holiday". If that's the case, it's still worth it, as the alternative is financially far more attractive.

Of course the club sales people will think it odd when they see us in the resort after saying we were pulling out, and that could be socially awkward (my wife might feel uneasy about that).

Or I could be honest with the sales lady and say "We've been offered this incredible deal. Can we pull out of the main contract?"

What do the panel think?

DullGreyGuy

What does the contract state about cancellation? 

What legal jurisdiction applies to the contract? 

Doesn't the fact that someone else is selling off the timeshare at bargain basement price cause alarm bells to ring? How did you find this person? Presumably there is a broker or such involved and so how much the seller is getting is even less than you think

thewinelake66

The contract states that we have the right to cancel within 14 days - and we're now on day 17.

I believe it's Portuguese law that applies.

It's quite normal for sites like confusedabouttimeshare.com and others to act as a timeshare exchange. It was through such an organisation (that I know is well respected and long established) that I found out about this. The guy selling it is apparently very ill and desperate to sell. I've seen other offers that are better than the one offered by the resort sales team, but this is significantly better.

The broker takes a 10% cut on the vendor side and a £299 fee from us.

sheramber

You will not know until you ask. 

Make sure you have the position clear before you buy the other timeshare.

Remember the salesman is looking for commission, so don't rely on his word.

TELLIT01

The timeshare resort may simply refuse to allow you to purchase, and/or occupy, the other unit if you default on the original purchase.  I certainly wouldn't trust the vendor of the second property to be acting in your best interests.  They will get commission from the sale of the property to you.

It's imperative that you do nothing about the potential alternative purchase until you get written confirmation of whether or not you can still withdraw from the original deal.

Something else you need to check thoroughly, whichever property you end up with, is the annual maintenance fee and how much the fee can increase year on year.  Ensure you have that information in writing.  Many years ago we purchased in the UK and,along with many others, were told the m/f was only reviewed every two years and could only increase by the RPI.  That turned out to be a barefaced lie.  When raised at the AGM the chairman of the developers firstly denied that anybody had been told that, and when half the place stood to dispute his claim, simply sneered and said 'show me in writing'. 

Trust and timeshare should never be used in the same sentence.

onashoestring

You have nothing to lose by asking the company if you can cancel the agreement, however under the T&Cs you have there is no legal obligation for them to agree. You have signed an agreement to pay full amount. The cooling off period agreed in writing has past. I think it’s unlikely that they will agree and it would not make business sense for them to do.

The salesman for the timeshare exchange has given you very bad advice . If you take the chance that he is right and commit to purchase the second property -  it could you cost you thousands as you will still be liable for the amounts agreed in the first contract.   I would therefore be very cautious about trusting anything else that this salesman says about this property.

TELLIT01

Just to add to my previous comments - although the purchase isn't in the UK it doesn't mean that the company can't or won't come after the OP.  I owned in the UK, although I'm now thankfully rid of it, and the owning company could and did take people to court for failing to pay the maintenance fees, never mind reneging on the original purchase agreement.  They argued, not unreasonably, that allowing people to walk away from their obligations simply increased the costs for all other owners.

thewinelake66

Just to update, I asked the sales manager at the resort what would happen if I were not to pay the final amount. She said that they could offer easier terms, but if I were to cancel, then I'd lose the €1500 deposit.
Then I foolishly said "Are you sure? The 14 days has past"

She took a long time in replying and so I sent off the registered letter requesting cancellation.

This evening she replied saying she'd have to check with her boss!

If I'd not requested clarification, I think that any courts would have thought that her iniitial statement should be a mistake and likely binding on them. Now that I have, and he comes back and says "sorry, you have to pay", then I think we'd have to think carefully.
The agent selling the alternative has said "We get this all the time, they can never be bothered to come after you" but MRDA!
The worst case scenario would be that we end up proceeding with both contracts. Maybe not a complete disaster, but certainly far from ideal!
It is clear with this deal that not paying maintenance for a couple of years would simply result in losing the apartment.