How to Get Out of a Timeshare That Has a Mortgage Attached

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With the promise of a luxurious vacation every year in a place that you love, along with excellent marketing and skilled sales people, it can be easy to decide to purchase a timeshare. Over time, the desirability of your vacation mecca may fade, due to changing needs. Your family circumstances may have changed, or financially, you may not be able to afford the monthly payments and maintenance fees. If you still owe money on the timeshare mortgage, getting away from the timeshare can be a challenge for many reasons unless you have the cash to pay off any remaining mortgage balance.

Step 1

Determine if the mortgage on your timeshare is a mortgage loan secured by the property. Some timeshare loans

are personal loans, and do not have to be paid off before you sell your timeshare. In this case, you can sell your timeshare, and apply the money received from the sale to the timeshare loan, and pay off any remaining balance according to the original terms of the loan.

Check to see if the lender will allow you to do a short-sale of the timeshare. The lender may recognize that they are securing a depreciating asset, and that the mortgage balance is greater than the value of the property. The lender still may require you to pay the remaining balance on the loan after the sale, converting the loan to an unsecured loan. But you will be free of the yearly maintenance fees.

Source: finance.zacks.com

Category: Credit

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