Want to Buy a Tropical Timeshare?

Ernie Wilbur of New Orleans takes his family diving to Cozumel so frequently that when he heard the timeshare pitch at the Sol Caribe Resort in 1998, it made a lot of sense. He plunked down $15,000 to secure the use of a Sol Caribe suite four weeks a year for the next 30 years. Instead, what he got was a lot of heartburn and a few hundred new friends, who joined him to pursue legal recourse against the Sol Caribe owners.

Wilbur and his fellow vacationers had run into a buzz saw of come-ons, sleight-of-hand and mumbo-jumbo that read like a textbook of unsavory timeshare practices. First, a street hawker -- sometimes known as a "roper" in the trade -- offered Wilbur a free breakfast to attend a timeshare presentation. Others were offered such enticements as free scuba diving, tequila, car rentals, or cash. Whatever works.

At the Sol Caribe, which was configured as a hotel, not a condo complex, they showed Wilbur a choice of three units: a basic studio (essentially a hotel room), a junior suite with a private bedroom, and a full suite with two bedrooms. As the 90- minute presentation dragged on to a four-hour ordeal, Wilbur was passed from one rep to another, car dealership style. Each of these "heat merchants" trotted out various incentives in return for signing up as a "charter member" of the Sol Caribe Vacation Club. Wilbur told Undercurrent that they promised him four weeks a year with no maintenance fee (usually $300 per week), if he signed up on the spot. They told him that he could arrange with Century21 Tri-Timeshares to have his unused weeks rented at a guaranteed net of $700 per week. Every so often horns blew, balloons were unleashed, and the staff cheered the signing of another charter member (number 97 or 98 out of 100 charter memberships ... feel that urgency building?).

Wilbur bought the four-week package, figuring he could defray much of the cost of a nomaintenance- fee two-week family diving vacation by renting out his suite the other two weeks. He left Cozumel looking forward to his next visit.

Smoke Dreams

Next year, when he called to reserve his suite, they told him that the larger units were still being finished, so only the studios were available. When he asked for his weeks, they told him he would have to transfer the $300/week maintenance fee to a Mexican bank to get a reservation confirmation number. No one seemed to know about the no-maintenance fee offer. And when he called Century21 to rent his unused weeks, the guaranteed income of $700 went up in smoke. In fact, it would cost him $199 to list his unit, with no guarantee at all.

So he complained to a sales rep at Sol Caribe, who referred him to an outfit called Vacation Networks International, which offered a guaranteed sale if he listed his unit for $500. But guess what? It never did sell. Then, in February 2000, Wilbur was notified that the company that had sold the timeshare contracts was now bankrupt, and the contracts were no longer being honored by the new hotel managers.

That led Wilbur to get on the net, where eventually he linked with 300 other Sol Caribe victims, many of whom were divers. Together, they retained a Mexican attorney to sue on their behalf. However, that effort is moving at a mañana pace, and the attorney has not responded to e-mail and phone messages from Undercurrent. A website, www.solcaribeowners.com is devoted to sharing information about the fraudulent resort practices, which may have victimized as many as 2,900 people for up to $25 million.

Wilbur was smart, however. He put his purchase on his credit card and recouped his $15,000 by disputing the charge through his issuing bank. Still, the dogged Wilbur continues to visit Cozumel and has even attended a sales presentation at the property, which is now called the Park Royal, where he's seen familiar faces among the sales reps and has heard the same outlandish promises, with a couple of new twists.

We thought Wilbur's was the granddaddy of all timeshare sob stories, until Undercurrent learned about a diving couple who purchased two units in Cancun for the same week after having been plied with lethal margaritas. Still, there is nothing new to these rip-offs. More than two decades ago, timeshares at the Riding Rock Inn on the isle of San Salvador in the Bahamas were glowingly written about in Skin Diver magazine. Many divers bought in, but got little or nothing in the end.

If You Really Want to Buy

Not all timeshares are ripoffs. However, many people who buy them become dissatisfied, if not with the financial terms, then with the maintenance of the property, the inability to rent or sell, or even feeling obligated to return each year to support their failed investment.

Chip Ballew, a veteran of the industry, maintains the website www.timeshares.com, which separates the myths from the real world. He offers the following overview of timeshare ownership:

Don't purchase a timeshare to make a profit. Due to initial marketing costs, resale prices rarely appreciate enough to make a profit.

Vacation ownership is for those people who want to use a property for themselves and their families. This can be a costsaving way to vacation, but on the average it takes nine years to recoup a one-week investment.

Besides your purchase price, you will be responsible for closing costs, taxes, an annual maintenance fee, and possibly club fees. The annual fees can be $500 or more. If you join a company to exchange your timeshare, you will have an annual fee of up to $80. Each time you exchange your week, another fee can run up to $160.

Resorts can be disaffiliated from the exchange companies due to the facilities running down, which could further hinder availability or your ability to rent or sell. Before buying, contact the exchange company to see if they are a member in good standing.

The Exchange Game

Many timeshare purchases include membership in exchange clubs such as Resort Condominiums International (www.rci.com), the world's leading vacation exchange company. RCI provides access to more than 3,700 resorts in nearly 100 countries, including such diving Meccas as: Thailand, Malaysia, Bali, Fiji, Tahiti, Australia, Bahamas, Aruba, Tobago, Bequia, St. Thomas, Costa Rica, and the U.S.

According to an ABCNews.com report, exchanging your timeshare for another is one of the biggest attractions -- and the source of its biggest disappointments. Many people find that the "anywhere, anytime" claim is an exaggeration. "Top vacation spots such as Hawaii can be hard to exchange into, especially if the weeks you own aren't during high season or in a desirable property. Furthermore, renting your timeshare is also notoriously tough to pull off. ... Many who try end up losing even more money, since they pay advance fees to rental agencies who often don't find any interested parties."

Because so many dissatisfied buyers try to bail out of their units, there's a market glut. That's led to the rise of timeshare resale brokers, which often have their own tricks of the trade, such as charging exorbitant listing fees and advertising costs.

For someone who wants to buy -- or for a seller looking for the right price to offer -- look for bargains on websites such as tug2.net, the website of The Timeshare User's Group (TUG). With supply far outstripping demand, you can find your dream timeshare at perhaps half what the original buyer paid, minus a couple of already used weeks. Chip Ballew says, "Check classified ads, estate sales, auctions, licensed timeshare resale companies, and other timeshare owners. Look in the telephone directory in resort areas to find the licensed resale companies."

One caution: Watch out for a lien for unpaid taxes or maintenance fees. Verify with the resort that there are no obligations. The title search will also reveal any outstanding liens against a week. Purchasing title insurance is always advisable.

And next time you're in Cozumel, look for Ernie Wilbur. He'll probably be wearing his T-shirt that says, "Ask me about my timeshare. I'm going diving."