We are not attorneys and are expressing our experienced opinions within these answers.
If you are concerned, please contact an attorney for clarification.
We have had many companies and uninformed individuals cast false claims of illegality at us and many other companies that do what we do. Often, they even refuse to read legal law code when it's presented to them. So, we will keep it simple here.
Real estate law has been established over hundreds of years. All states follow the same basic requirements. Extra, non-legal or binding rules have been established to support company policies. These deal with title insurance, maintenance fees, local group policies, etc. But the basic requirements are all that is needed to deal with title.
- Both the buyer and seller must agree in writing to a transfer of title. It can be on a napkin, contract, or shirt sleeve as long as it can be shown in court that what was agreed to was done.
- A legal document called a DEED must identify the parties and property in the transaction.
- The DEED must be recorded in the county recorders office in which the property lies so that the transfer becomes public knowledge.
That's it. That's all. No broker or title company is required. No permission from another party is required unless that party is on the original deed. Either a buyer (donor) or seller (charity) can do the paperwork.
A mortgage can't be transferred without the lender's permission. It still remains on the property even after transfer unless the lender allows transfer of the MORTGAGE not the DEED. Even so, if the mortgage or any other lien (unpaid bill) is not paid, the person owing the money at the time the bill was created is still responsible for payment and can be sued for it. This means a currently due assessment, maintenance fee, owners association fee, mortgage, etc. are the responsibility of the seller. However, all future such bills are past that seller and can't be brought back to them.
US Law for consumer credit and foreclosures are strict and simple. The only options available for resorts is to go after the current owner and the property. Any contract they have outside that would be ruled unenforceable. This is pretty straightforward.
The only options available to any lien holder (timeshare company) are:
- Nagging billing
- Send to collections which is an upscale of #1
- Foreclosure on the property. This is to take title to the property so it can be liquidated and the proceeds used to pay off the lien. If there are insufficient proceeds, suit can be brought against the current owner for any shortfall. However, it must be shown that the sale price was realistic at a public auction or by court order dismissing any future charges.
So, here it is in a nutshell.
No permission is required by anyone except the seller (donor) and buyer (charity). As soon as the deed is recorded title is transferred and all future responsibility for the property goes to the buyer (charity). If new bills are created the new owner may or may not pay them. That's not illegal. It is the option of the lien holder (the timeshare company) to continue billing or foreclose on the property.
- We are a charity that does NOT use the timeshare. So restrictions of use don't bother us.
- We do not use credit so threats of credit ruination don't bother us.
- We inform the timeshare company of our intent to not pay their bills.
- We encourage them to take title back quickly and easily "in lieu of foreclosure" which is not a sale according to IRS regulation. This becomes a "freebie" for them to sell again at FULL profit. It's never marked down as "used".
- We use the law to free you and "encourage" them to stop the harassment.
- Nothing in this process is illegal.
Bottom Line - We use the law to encourage the timeshare companies to play fair.
- Ownership type: Deeded or Right-To-Use?
- What can affect Title Transfer?
- Have you tried these steps?
- Timeshare - What is the resort profit on its sales?
- Timeshare - Do I need resort permission?
- Timeshare - What will the resort tell you?
- Timeshare - Can the resort come back to me in the future?
- How long will it take?
- Process of Transfer?
- Why use an escrow company?
- What is an IRS Qualified Appraisal?
- Can the Property Be Transferred without Removing the Liens?
- What happens to Current Bills / Debt?
- Can Civil Action be Brought Against Me?
- How is VRI different than other services?
- What is VRI experience?
- What does VRI do with the timeshare?
- IRS on Real Estate Donations
- IRS on Mortgage Donations
- 100% Money Back Guarantee
- Bottom line: What does it cost?