You need to be cautious, as there are pros and cons of the timeshare option.

It is important to understand the concept, the options, and the pitfalls and cautions.

Other commonly used terms synonymous with timesharing include: resort timesharing, vacation ownership, multi-ownership, interval ownership and shared vacation plan.

There are two main categories of timeshares: right-to-use and partial ownership.

Right to use
This concept is much like having a long-term lease, but with limited use for perhaps one, or maybe two weeks a year. It is similar to prepaying for a hotel room for a fixed period every year, 20 years in advance. In other words, you don’t have any portion of ownership in the property, you only have a right to use it for a fixed or floating time period every year. The right-to-use concept involves condominiums, recreational vehicle parks, and other types of properties.

The opportunity for return on your money in a “right-to-use” timeshare is limited or non-existent. This is because there is generally very little demand in the after-sale market, as well as other restrictions on resale or pricing of the resale. In practical terms, this type of timesharing is primarily a lifestyle choice.

Partial condo ownership
There are different formats. One involves owning a portion of the condominium (for example, 1/50 of the property). Each 1/50 portion would entitle you to one week’s use of the premises. Other people would also buy into the property. Normally you would be allocated a fixed week every year. In other instances, it could be a floating time, with the exact date to be agreed upon depending on availability.

In some cases, you might purchase a one-quarter or one-half interest. If the property is sold, you would receive your proportional share of any increase in net after-sale equity proceeds. You would also normally be able to rent, sell or give your ownership portion to anyone you wished. This type of “timesharing” is frequently referred to as fractional ownership.

Pitfalls and cautions
You may tire of going to the same place every year, as your needs may change. The timeshare programs that include an exchange option (switching for a week in a different location) are not always as anticipated, in terms of availability, flexibility, convenience, or upgrade fee. Make sure you know what you are getting. Some people who purchase the “right to use” type think they are actually buying a partial condo ownership portion.

Be wary of hard-sell marketing. In most cases, you are offered so-called free inducements (a buffet, dinner cruise, etc.) to convince you to listen to the sales pitch.

The dream fantasy is heavily reinforced, and high-pressure sales pitches, given by teams of salespeople, can go on for hours and be very persuasive­—if not aggressive. Furthermore, very manipulative techniques are sometimes used to get you to sign a credit card slip as a deposit. There is usually an ongoing management fee for maintaining the premises.

Timeshare sales in Canada and some U.S. states are sometimes covered by consumer protection, in terms of your right to get your money back by “rescinding” or cancelling the contract within a certain time period. However, for timeshares in other countries, such as Mexico, this is generally not the case. Timeshares are a dream for some, but a nightmare for others.

Speak to at least three timeshare owners (not recommended by the salesperson!) in the project you are considering, to obtain their candid opinion before you buy. Never give out your credit card for any reason as a deposit, or sign any documents without first speaking with a local real estate lawyer. Obtain a lawyer’s name from the local lawyer referral service or provincial or state bar association. Don’t let yourself be pressured. Check with the local Better Business Bureau. Then sleep on it for some time. If the deal seems too good to be true, it probably is. Buyer’s remorse is  common for people who buy timeshares while on vacation.  CL