What I've Learned about Timeshares: Part 4

The idea of timeshare exchanging is really very straight forward. You have a reserved week in Las Vegas on the third week of June. You’d rather spend a week in Hawaii on the second week of March. If you can find a Hawaii timeshare owner that has that second week in March reserved AND would rather go to Las Vegas on the third week of June, then you might be able to arrange a trade weeks with each other. Exchange companies play a middleman role in this process. Basically, members give their weeks to the exchange company and if the company has a week that you want, they give that week to you. In reality it’s a little more complicated than that and I’ll get into it a bit more in the next article.

Almost all timeshares are officially associated with an exchange company. The two biggest exchange companies are Resort Condominiums International (RCI) and Interval International (II). Marriott Vacation Club happens to be associated with Interval. So I’ll concentrate on them. At the time of this writing, their yearly membership runs at about $89. When you buy from Marriott, they will pay your first year’s membership. My experience with this was that if I wanted to exchange for a vacation after the expiration date of my membership, I had to pay the next year’s membership fee before I could complete the exchange. So when I purchased, by the time I got all the paperwork and reserved the week I wanted from Marriott, a few months had passed since my membership started. Since the week I wanted to exchange into was after the membership expiration, I had to fork over another year’s membership dues before I could make the exchange. Basically, that first year’s membership was a waste of money for me.

Each exchange also incurs an exchange fee. So now I’ve reserved my week with Marriott. I’ve paid my fee to lock-off my room. I’ve deposited both the studio and the 1-bedroom weeks with Interval and I now have to pay Interval an exchange fee when I find something I want to trade for. I don’t know for sure because I’ve never had to do it myself, but I believe that if you were making the reservation for someone other than yourself, you would incur some kind of fee as well.

This is what I mean when I talk about fees overwhelming timeshare owners. Look at this breakdown:
Maintenance Fee: $850
Lock-Off Fee: $125
Exchange Company Membership: $180 (2-years of membership)
Exchange Fees: $200 ($100 for the lock-off studio, $100 for the lock-off 1 bedroom)

These are the numbers that the salespeople gloss over during the sales pitch. Is it really any surprise that many timeshare owners are really unhappy with their purchase? Again, this is why I say that you never want to purchase as an investment and you certainly do not want to buy if you can barely afford your house.

Until recently Disney’s Vacation Club was also associated with Interval, but now they’ve recently switched to RCI. The interesting thing is that Disney controls the exchanges. I don’t have to pay a membership fee to RCI, at least, not directly. I’m sure part of my yearly dues goes towards that membership. Any type of vacation you take with your Disney points has to go through Disney’s member services. If you want to exchange your points for that week in Branson, you call up Disney, tell them what you want and if they can find availability, they’ll let you know. Of course you get charged a small fee for that service. For all the talk about how expensive Disney is overall, it’s amazing that they don’t have very many fees.

Of course, exchanging is completely voluntary. You are always welcome to use your week year after year. Same bat time. Same bat channel. That may work for you. More power to you, but the whole point that I personally bought was to see more of the world. In fact, I bought my Marriott with the explicit intent of exchanging. I’ve never stayed there. I live within a 15 minute drive. I guestimated the cost of exchanging when I made my decision to purchase. I was a little under, but not by too much.

Are you looking for a way to save money when you trade your timeshare? How about looking for a vacation home to rent? Take a look at http://www.reservnstay.com. All listings are free.