Published 8 March 2020
Selling timeshares without a real estate license is a felony in New Mexico, but that’s not stopping out-of-state scammers from preying on unsuspecting timeshare owners, according to a February 23, 2018 bulletin from the New Mexico Regulation and Licensing Department.
Unlicensed solicitors claiming to represent full-service property management, real estate brokerage or title and escrow companies that list and sell timeshares are soliciting upfront fees from timeshare owners who want to list their fractional ownerships for sale. The problem is that the timeshares are never actually listed for sale and the fees are gone forever.
“We have received a surge of inquiries from consumers who have been contacted by a company that represents itself as R-5 Realty. R-5 Realty is not licensed by the real estate commission”, said Mike Unthank, Superintendent of the New Mexico Regulation and Licensing Department. Unthank went on to say that “Timeshare fraud is a serious crime, which can cost consumers thousands of dollars.”
Representatives of these phony companies are falsely identifying themselves to consumers using the names and license numbers of actual New Mexico real estate companies, unbeknownst to company officials. They use a fictitious Albuquerque address and instruct owners to send upfront listing fees to out-of-state or out-of-country escrow companies.
The Federal Trade Commission strongly suggests that you go into skeptic mode when contacted by a company offering to sell your timeshare, and take the following steps:
- Don’t agree to anything on the phone or online until you’ve had a chance to check out the reseller. Contact the New Mexico Attorney General at 844-255-9210 and ask if any complaints are on file.
- Ask the salesperson for all information in writing.
- Ask if the reseller’s agents are licensed to sell real estate where your timeshare is located. If so, verify it with the New Mexico Real Estate Commission at 800-801-7505.
- Deal only with licensed real estate brokers and agents, and ask for references from satisfied clients.
- Ask how the reseller will advertise and promote the timeshare unit. Will you get progress reports? How often?
- Ask about fees and timing. It’s preferable to do business with a reseller that takes its fee after the timeshare is sold. If you must pay a fee in advance, ask about refunds. Get refund policies and promises in writing.
- Don’t assume you’ll recoup your purchase price for your timeshare, especially if you’ve owned it for less than five years and the location is less than well-known.
Timeshares are big business. According to the American Resort Development Association’s State of the Vacation Timeshare Industry: United States Study 2017 Edition, there were 1,558 timeshare resorts in the United States in 2016, representing about 206,080 units. U.S. sales volume reached $9.6 billion in 2016, with rental revenue reaching $1.9 billion. A total of 5,300 resorts are operating worldwide, with approximately 20 to 30 currently operating in New Mexico, according to the RLD.
See you at closing.
Gary Sandler is a full-time Realtor and president of Gary Sandler Inc., Realtors in Las Cruces. He loves to answer questions and be reached at 575-642-2292 or Gary@GarySandler.com.