Permanent timeshares should absolutely be illegal. It's ridiculous to allow a permanent obligation to maintain a property that the "owner" isn't allowed to destroy.
How do you destroy an apartment? It's the same legally as any condo. When you bought it, you promised all the other owners to help maintain the building in exchange for them all doing the same. You need everyone's consent to undo that. You can't get out of a contract because it's a bad deal. Timeshares are just such a bad idea because you dilute the ownership to worthless levels and the management companies add on exorbitant fees of their own.
> You can't get out of a contract because it's a bad deal.
I think there is a difference between something that you dont know is a bad deal because it depends on future events (real estate market shifts or whatever) vs something that is a bad deal because you were mislead or didn't understand the contract.
If you take a risk and it doesn't work out - that is life. However that is a little different from the timeshare case, which seems less about risk and more about tricking people.
There's much worse tricks, like convincing you to fight a war as a soldier where you can't leave under threat of arrest or death, depending on the country, for example.
This reads as yet another symptom of the US mentality which sees government regulation and taxes as evil, but property rights and contracts as sacrosanct.
It shouldn't be possible to sign a contract that binds you to arbitrary amounts of future fees. When buying a property, you shouldn't be locked into doing whatever maintenance the co-property fancies unless you at least own a voting stake in that co-property. (And even then, only within reasonable limits.)
This is the same mentality that somehow sees student loans with >10% interest rate as anything but a symptom of a disfunctional economy.
At the very least, for cases like these, the government should tell scammers creating those constracts "You're free to put that ink on paper, but we're not going to use our monopoly on legitimate violence to enforce it".
The UK is way ahead on this one. Enter into a contract to own part of a property as an "affordable" option. Get screwed by service charges that have no limit.
Contracts don't necessarily need a signature to be valid. If you order food at a restaurant, there is an implied contract that you will pay for the meal.
However, this amount is almost always stated in the menu, so it isn't arbitrary. In fact, in each of the above cases, the amount you pay is almost never arbitrary, but based on usage or a preset price.
I think they just mean that in many restaurants you pay only after receiving your food, but it's really not a very good comparison for a number of reasons.
Especially since all of the above listed things, but especially restaurants, have stated prices and often a means of negotiating them down or being entirely un-obligated if the providing party fails too severely.
And since, though not fully related, a restaurant can choose not to accept credit cards for instance, but there's often an obligation to state that clearly and visibly somewhere obvious beforehand, and always (in the US) an obligation to accept cash for debts owed in this manner.
I don't know how these contracts work in the US, but in the UK if you buy a leasehold apartment where you own the individual unit without having ownership of the building itself, there will be clause in the agreement that states if you fail to pay the maintenance fees or to keep the unit in good repair ownership can be reclaimed by the owner of the building.
There are no end of issues with leasehold properties, but there is at least a way out if you decide you can't deal with the maintenance fees attached. You'll probably end up with a terrible credit record for defaulting on your mortgage, but at least you can get out.
Yeah, it's the same. The timeshare association can reclaim the timeshare, but again, if it's worth approximately -$2,000, why would the timeshare association reclaim that unless it absolutely has to?
Presumably the difference with a condo is that the condo owner has a fair vote in the buildings management (usually an HOA in the US) and enough votes can be used to destroy the building if it achieves high enough liability-to-value ratio. That does not exist for a timeshare, the timeshare owners can never band together to change the governance of the building
That's a great observation. I've always wondered while biking past old apartment complexes in Mountain View being torn down: who foots the bill for the value destroyed, and who makes those decisions. If you owned one of those units, could you just get outvoted a lose a million-dollar condo like that?
My guess is the condo votes to sell the land to someone else, distribute the money to the condo owners and then dissolve. Generally the condo isn't worth a million dollars anymore though as the building is old. Or maybe it is worth a million but you were paid 1.1 million to get out as whatever replaces it is that much more valuable (if it really was worth a million I'd guess not, but the million dollar condos of 1950 are not worth nearly that much today but the land itself is worth a new million dollar condo.
It is also possible the condo voted to tear down the building and build new - if you owned the condo before you will have one again in 2 years, but you are required to live elsewhere in the mean time. (Million dollar condos in Iowa implies you can afford a second house/apartment, while in San Francisco it would not)
