There are many reasons to own a timeshare in Florida, mainly because you can enjoy the best of both worlds. Not only do you get a much-needed escape to your own personal paradise, but these opportunities are usually more affordable than a traditional vacation. But, there is one critical detail many individuals forget about when buying in, and that is what happens to it after death.
Without proper planning, what seems like a beautiful inheritance option can quickly become a financial stress for beneficiaries.
Timeshare ownerships rely on an agreement that is signed on the day of purchase. These contracts have specific legal clauses that outline your ownership rights and the period they last, typically a life span.
In the case of your passing, any timeshares you own would become a part of your estate. This includes any benefits and obligations attached to it that pass to your designated beneficiary or next-of-kin. If you only have a will to manage your estate, you will not avoid the Florida probate process. The court will still need to transfer ownership officially, and in cases of no will being left behind, probate will decide who gets the property according to state succession laws.
To keep your timeshare out of probate and immediately given to the beneficiary you choose, consider a revocable trust. This estate planning option ensures who will receive your property, does so quickly, and minimizes exposure to costly court fees. This means less red tape and hassle for your loved ones trying to receive it.
There are other situations to consider before leaving your loved ones a timeshare as part of your estate. Should payments have fallen behind, or you failed to keep up with required maintenance fees, for example, the resort’s owner may decide to foreclose. It is also possible any outstanding balance due could come out of your assets upon your death. If you plan to allow the property to go through Florida probate, remember that some real property is not exempt under state homestead protections. Make sure to speak with a knowledgeable estate planning attorney about your timeshare situation.
If a family member left you a timeshare as part of their estate, they probably imagined you and your loved ones making great memories on the property. This can be a blessing and a curse if you do not know the basics of owning one of these retreats.
Keep the following points in mind if you inherit a timeshare property:
Carefully Review the Timeshare Agreement
Trying to process the recent loss of a loved one is stressful enough without the legal obligations that come with managing their estate. However, if you received a timeshare, you must review the terms of the agreement, especially any regular fees and penalties that come with owning it.
Meet with the Timeshare Developer
Timeshare contracts can add significant complexity to any probate case, whether located in Florida or not. Set up a meeting with the developer of the timeshare and explain the situation. Many times, they have no way of knowing an owner has died until someone calls them. They can supply you with further information about the property and let you know if all payments are up-to-date. More importantly, you can find out what information they need to help ensure ownership gets transferred.
Continue Making Payments
While many of us would hate to inherit a new financial obligation we didn’t ask for, deciding to stop making payments is not the solution. Fees can pile up fast, and legal or collection proceedings could be taken against you. Instead, find out from the developer what their process is for timeshares bequeathed to loved ones. They likely have many options available to help you with this dilemma until you decide what to do with the property.
You Don’t Have to Take the Property
Taking on ownership of a timeshare may not be something you want, and you can decline your inheritance. Doing so would mean the property would go to the next-of-kin who could also deny it if they wish. If no one accepts it, the developer could pursue a foreclosure proceeding and would have any outstanding debt paid through the estate assets instead. If done correctly, this would help you avoid credit damage.
What about Selling or Transferring the Timeshare?
Selling a timeshare is not the same as a house. Depending on the provisions in the agreement your loved one signed at purchase, they may have to go through the developer first. Some companies claim to be timeshare resellers who purposely target those in this situation. These are almost always scams involving helping to sell the property (often illegally) for an expensive fee upfront. Always talk to the timeshare developer first about your desire to sell. They usually have a process to help you accomplish this and will not require money upfront.
A great idea for dealing with an unwanted timeshare is transferring ownership to someone else. If you simply want it off of your hands for little cost, the property developer will have valuable advice since this is not an uncommon scenario in their business. If it is completely paid for and not behind on annual fees and maintenance, this process will be more straightforward.
Timeshares are rarely the first order of business when settling an estate after someone passes away. Often, families had no idea their loved one owned this property or what to do with it. The best way to avoid this asset turning into a costly headache for those you love is to include it in your estate plan.
At The Legacy Law Firm, we help families with timeshare and estate planning questions every day. We know the common mistakes to avoid that could jeopardize your vacation property. Call us today at (954) 999-9683 or contact us online to discuss your unique situation, learn more, and get started.
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