How Do Vacation Certificates Work?
Timeshare resorts, travel clubs, automobile dealers and many other types of businesses may notify you by mail or telephone that "You have been selected for an island vacation that includes free airfare and accommodations" or that you can "Join our travel club and get a 'free' vacation." Maybe you filled out an entry form for a vacation sweepstakes or other prize giveaway at a store, fair, trade show or other local event. Some companies may advertise "free" vacations as a bonus for buying products or services.
To receive the vacation certificate, you may be required to make a purchase or attend a sales presentation, often at a timeshare resort, membership campground or other land sales promotion. In addition, there may be other conditions for acceptance, such as age or income requirements, or attendance with your spouse. You might also have to bring the notice you received from the company, and proof of your identity.
Vacation certificate offers vary. Some certificates include lodging in a hotel or timeshare resort for a certain number of days and nights in the United States or out of the country. Other offers include "free" airfare or a cruise, or give you one "free" ticket with the purchase of the second. Some certificates include discount or "free" coupons for restaurants, tours or attractions in the resort area.
You are usually required to fill out the vacation certificate with information such as your three choices of when you wish to take the vacation. You return it to the company 30 to 60 days before you wish to use the vacation offer.
Companies may require a non-refundable processing and handling fee, or a refundable deposit from $50 to $100 to reserve the vacation time request. Vacation certificates requiring a refundable deposit usually state that the deposit will be returned upon your arrival at the place of lodging or after you have used the vacation. Companies usually advice that written confirmation will be sent when the deposit is received.
CHECK FOR HIDDEN COSTS.
ARE THERE DEPOSITS REQUIRED? WHO PAYS FOR MEALS AND TRANSPORTATION?
Why Are Vacation Certificates Offered?
Businesses often provide vacation certificates in large quantities believing that the attraction of a "free" vacation will draw customers to their sales sites. The goal of the business is to sell a specific product or service. Although many people receive these offers, one promoter stated that very few will actually use the vacation certificate. For this reason, they can afford to promote the vacation certificate to many people.
According to one timeshare resort operator, the offer of "free" lodging is used to introduce a new timeshare resort to potential buyers. Another company stated that in offering the "free" vacation to its customers, it sold products and created goodwill.
Why Does the Airfare or Other Costs Seem So Low?
In many cases, if a low fare for transportation or low hotel rates are offered, the company makes up its loss in another area. In other words, you don't get something for nothing. For example, one marketing company offered low airfare to a resort island with hotel bookings made through the company. However, the marketing company did not state that is was on a space-available basis or that hotel rates were $40 a day higher than the average hotel, and you had to stay at least seven nights.
BBB Customer Experience
A survey of local Better Business Bureaus across the country showed that there have been consumer complaints about vacation certificate offers. Some consumers complained they did not receive the offered vacation certificate. Others complained the offer was misrepresented. For example, some participants stated that they received incomplete information regarding airfare costs and couldn't get airfare reservations or requested vacation times. One consumer claimed that the offer described over the phone was different from written information given after the sales presentation. Some consumers stated that other eligibility requirements were added to those conditions listed in promotional literature.
Florida requires companies such as timeshare resorts that offer lodging promotions to file certain information with the state's attorney general. In Maryland. timeshare promoters must register with the state's real estate commission. Also, Maryland residents receiving a "free" gift or prize promotion do not have to listen to a sales presentation or buy and product/service. Texas and New York state laws require, among other things, that the
odds of winning and the approximate retail value of the prizes be give in a company promotion.
Many states have actively sought to protect consumers against misrepresentations made by some vacation certificate promoters. For example, the Arizona Attorney General took legal action against one vacation certificate promoter who did not disclose all the limitations of the vacation offer. Although buyers had been told that extra fees would be charged for the peak season, they weren't told that 80% of the year was considered the peak season. The California Attorney General filed a complaint against a travel club company that called consumers and asked them for a major credit card number to validate a complimentary vacation. However, the company charged fees on the consumers' credit card accounts without their permission.
Consumers should contact their state's attorney general and find out if companies offering vacation certificates are required to register their offers with the state.
1) Contact your local Better Business Bureau for a reliability report on both the vacation certificate company and any other company involved in an offer that requires you to listen to a sales presentation or purchase a product. Until you are certain you wish to use the offer, do not give any company cash, check or credit card number.
2) Read the rules carefully. Do you meet the required conditions, such as age and marital status?
3) Determine if all costs involved in using a vacation certificate. It will be your responsibility to pay for anything not specifically mentioned. Do you pay for:
-- Hotel, timeshare or resort or other lodging?
--Transportation from your home to the resort? Or, do you first have to travel to a distant location where the company then pays for "free" travel?
--Transportation from the airport to the lodging accommodation?
--Additional fees for the peak tourist season? When is the peak season?
--Port taxes when visiting a foreign country?
4) Before traveling, confirm all arrangements directly with the:
--Airlines, cruise lines, etc.
--Hotel, timeshare resort, etc. (Requesting descriptive brochures directly from the lodging may help to avoid unpleasant surprises once you arrive.)
--Business sponsors such as restaurants or resort attractions offering discount or other coupons. Determine any restrictions on coupon use.
5) Ask the vacation certificate promoter what happens if the hotel or other accommodations are completely booked.
6) If a refundable deposit is required, when and how do you get it back? Find out what the company will do if it can't match your requests with a specific vacation time. Can you get your money back?
7) If "free" travel is offered, can you make your own travel arrangements or do you have to use a specific travel agent? If you use the company's travel agent and you must pay for a second ticket, determine if the cost of the second purchased ticket is more than if you made your own travel plans for two through another source. Is the rate competitive with rates available through other travel agents, airlines, etc.?
8) In general, the BBB advises that you consider attending a sales presentation only if you are interested in what's for sale, not for the prize alone.
9) If you attend a land sales presentation, obtain a copy of the Property Report often required by federal law, and read it before signing any contract or written agreement.
Warning Signs to Watch For.
Be alert to the following "red flags" that may signal fraudulent travel promotions:
--Salespersons who use high-pressure tactics such as:
-Demanding your credit card number before explaining all the conditions of the offer
-Requesting that you identify yourself by your credit card number(a sign of possible misuse of your card)
-Refusing to provide all the information about the total cost of the travel offer
--Post card promotional mailings that say you have won a weekend trip to a resort, but require you to pay a fee in order to claim the prize
--Low rates on air travel that require you to purchase an additional ticket for a companion
--Offers by companies attempting to subvert U.S. postal authorities by requiring a messenger, to courier, to deliver the travel package to you in exchange for your payment
This report is general in nature and not intended as a reliability report on any company, service or product.