Lawsuit against timeshare exit team: what owners should know

Last updated 2026-07-26

Can you actually sue a timeshare exit team?

Yes. If a timeshare exit company took your upfront fee and did nothing, or lied about what it could do, you generally have grounds for a breach of contract claim, a fraud or misrepresentation claim, or a claim under your state's consumer protection or deceptive trade practices act. Whether it's worth doing is a separate question. Most exit companies that collect large upfront fees (often $3,000 to $10,000 or more) and vanish are thinly capitalized, sometimes shut down under a different name, or based out of state. Winning a judgment is one thing. Collecting on it is another. Courts can't force a company to pay if the company has no assets and the owners who ran it filed personal bankruptcy or moved the money offshore. That's why the two biggest wins for defrauded timeshare owners in the last decade came from government enforcement, not individual lawsuits. The Federal Trade Commission and multiple state attorneys general have sued exit companies directly and won refunds, asset freezes, and permanent bans on doing business. Those cases do the expensive investigative work that an individual plaintiff usually can't afford.

What lawsuits has the FTC already brought against timeshare exit companies?

The FTC has brought several enforcement actions against timeshare exit and relief companies since 2018, and its own consumer alerts describe the pattern owners keep reporting. In 2021, the FTC and the state of Washington sued Consumer Advocacy Center Inc., doing business as Timeshare Exit Team, along with related defendants, alleging the operation charged consumers thousands of dollars up front while falsely promising to get them out of their timeshare contracts, in a case that led to a settlement including a monetary judgment and business restrictions ^[1]. The underlying complaint, filed in the U.S. District Court for the Western District of Washington, alleged violations of the FTC Act's prohibition on unfair or deceptive acts and the Telemarketing Sales Rule's ban on collecting advance fees for debt relief-style services before performance ^[1]. The FTC's broader consumer guidance recommends checking a company's standing with your state attorney general and the Better Business Bureau before paying anything, and never wiring money or paying by gift card, both classic signs of a scam operation.

Have state attorneys general sued timeshare exit companies too?

Yes, and these cases matter more for most owners than a private lawsuit would. State AGs have subpoena power, can freeze assets fast, and often negotiate restitution funds that get distributed to victims automatically, no lawyer needed on the consumer's end. Washington's Attorney General joined the FTC's 2021 action against the Timeshare Exit Team-affiliated entities ^[1]. Other states, including Florida and Tennessee, have pursued timeshare-adjacent telemarketing and advance-fee cases under their own consumer protection statutes. Wisconsin's Department of Agriculture, Trade and Consumer Protection enforces the state's deceptive trade practices law, Wis. Stat. section 100.18, which prohibits false, deceptive, or misleading representations made to induce a consumer into a contract ^[2], and consumers can use it as the basis for a private claim against an exit company operating in the state. If you paid an exit company and suspect fraud, filing a complaint with your state attorney general's consumer protection division costs nothing and adds your case to a pattern investigators may already be building. Search '[your state] attorney general consumer complaint timeshare' or check the National Association of Attorneys General directory for your state's contact page.

What has the FTC actually recovered for consumers in these cases?

The FTC tracks fraud complaint data through its Consumer Sentinel Network, which logged more than 2.6 million fraud reports in 2023 with reported losses exceeding $10 billion across all fraud categories, though the agency does not publish a single running total specific to timeshare exit fraud alone; those cases are folded into broader categories like advance-fee and business opportunity fraud ^[3]. What is public: the FTC's 2021 stipulated settlement against the Timeshare Exit Team-affiliated defendants included a monetary judgment and a permanent injunction barring the defendants from telemarketing timeshare exit services ^[1]. The honest takeaway is that recovery amounts in these cases are often a small fraction of what victims collectively paid, because the money is frequently spent, hidden, or moved before the case is filed. Do not count on a payout. Treat a favorable settlement as a possible bonus, not a plan.

Should you hire your own lawyer to sue an exit company?

It depends on the dollar amount and what you can prove. If you paid a few hundred dollars, small claims court is usually the right venue: filing fees are typically $30 to $100 depending on the state, you don't need a lawyer, and the process is built for exactly this kind of dispute. If you paid several thousand dollars and have a written contract with clear promises, a consumer protection attorney working on contingency might take the case, especially if your state's deceptive trade practices act allows recovery of attorney's fees, as Wisconsin's does for private claims brought under section 100.18 ^[2]. Ask any attorney you consult whether they've handled timeshare exit fraud specifically, and ask for the outcome of a prior case, more than a fee quote. What rarely works: paying another company big money to 'help you sue' the first company. That's a second version of the same scam, just wearing a different hat.

How do you know if a timeshare exit company is a scam before you pay?

Watch for a specific cluster of warning signs the FTC and multiple state AGs describe consistently. - A promise of a fast or effortless exit with no real assessment of your contract. No legitimate company can promise your resort will release you from a contract, because the resort, not the exit company, controls that decision.

• Large upfront fees with no escrow. Legitimate transactions in real estate commonly use a third-party escrow account so money isn't released until work is done. Exit companies that demand full payment up front, no escrow, are a red flag.
• Pressure to stop paying maintenance fees or the mortgage. This is one of the most damaging patterns. Stopping payment can trigger default, foreclosure, and credit damage, on top of whatever fee you already paid the exit company. Never stop payments you legally owe based on an exit company's advice.
• Cold calls claiming to be resort partners or timeshare 'compliance officers.' Real resorts don't typically cold-call to offer exit deals through a third party.
• No physical address, or an address that turns out to be a mailbox service. For a rundown of vetted companies and what legitimate exit services actually look like, see our guide to timeshare exit companies.

What should you do if you're still inside your rescission window?

Use it. This is the fastest, cheapest, and most certain way out of a timeshare, and it requires no lawsuit, no exit company, and usually no lawyer. Every state that regulates timeshares gives buyers a rescission period, a short window after signing during which you can cancel the contract and get your money back, no questions asked. The length varies by state, from as short as three days to as long as fifteen, and the rule is specific to where the resort (not necessarily where you live) is located. Confirm your state's rescission window with your state's statute or your state attorney general's consumer page before you assume you've missed it. To rescind, follow the exact instructions in your purchase contract, usually a written notice sent by certified mail to the address specified in the contract, postmarked before the deadline. Keep a copy and the mailing receipt. Our guide on how to get out of a timeshare walks through this step by step, and our rescission breakdown covers state-specific timing.

What if your rescission window has already passed?

You still have real options, they're just slower and less certain than rescission. Deed-back or surrender programs let some owners return the deed directly to the resort developer, sometimes for a small fee, sometimes free, if the resort has such a program and the owner is current on fees. Not all resorts offer this, and the ones that do often require you to be paid in full with no outstanding loan balance. Selling on the resale market is legal but usually returns very little money. Timeshares have almost no resale value; a huge share of listings on sites like the Timeshare Users Group and eBay's timeshare category sell for $1 or list with no buyers at all, because ongoing maintenance fee obligations make them a liability, not an asset, in most buyers' eyes. If you're trying to sell, be realistic about price and never pay an upfront 'listing fee' to a company that contacts you unsolicited claiming to have a buyer already lined up, a very common resale scam. Some owners work directly with the resort on a hardship or financial-distress exit, especially if they're elderly, have a documented income drop, or inherited the timeshare and don't want it. It costs nothing to ask the resort's owner services department directly what options exist before paying a third party.

Are timeshares scams?

The timeshare product itself is legal and regulated in every state that permits its sale; it is not inherently a scam in the way a fake exit company is. But the sales process has a long, well-documented history of high-pressure tactics, and a large share of the exit industry that has grown up around unhappy owners is fraudulent. The distinction matters. A timeshare purchase you regret because the sales presentation ran four hours and included threats about a 'today only' price is a bad deal made under pressure, but the underlying contract is enforceable. A company that takes $6,000 from you and disappears without transferring or canceling anything is fraud, and that's the fact pattern behind the FTC's 2021 case described above ^[1]. Owners frustrated with rising fees often ask 'are timeshares scams' when what they mean is 'was I misled about the value of what I bought.' Usually the honest answer is yes, in the sense that resale value is near zero and maintenance fees rise most years, often faster than inflation, but that's a bad investment, not necessarily an illegal one.

How much do timeshares cost, and how much can you lose trying to exit?

New timeshare purchase	~$19,000 to $24,000	ARDA industry survey data [4]
Annual maintenance fee	~$1,000 to $2,000+	Rises most years; special assessments extra
Resale market value	Often near $0 to a few hundred dollars	Ongoing fee obligation deters buyers
Exit company upfront fee	~$2,000 to $10,000+	Cited in FTC enforcement complaint [1]

Timeshare purchase prices vary enormously by brand, location, and unit size, but industry surveys have put the average purchase price for a new timeshare interval in the range of roughly $19,000 to $24,000 in recent years, according to figures cited by the American Resort Development Association's industry data ^[4]. On top of the purchase price, annual maintenance fees commonly run from $1,000 to $2,000 or more, and those fees typically rise a few percent most years, sometimes with special assessments added for major repairs. Trying to exit through an upfront-fee exit company adds another cost layer on top of a purchase many owners already regret. Reported fees for exit services commonly range from $2,000 to $10,000 or more, according to complaints compiled in the FTC's 2021 enforcement filing against the Timeshare Exit Team-affiliated entities ^[1]. If that fee produces nothing, an owner can be out both the original purchase price, years of maintenance fees, and the exit fee, with the timeshare contract still fully in force. | Cost category | Typical range | Notes |

How do you sell a timeshare if you'd rather not deal with an exit company at all?

Selling directly is possible, and it's usually cheaper than paying an exit company, though it rarely returns meaningful money. List through the resort's own resale or transfer program first, if it has one; some developers will facilitate a transfer for a modest administrative fee, and buyers get a cleaner title history than through a third-party broker. If the resort has no such program, licensed timeshare resale brokers exist in most states and are required to hold real estate licenses; verify any broker through your state's real estate licensing board before signing anything or paying a fee. Never pay an unsolicited caller who claims to have 'a buyer ready' for your specific unit and just needs a processing fee first. That call is one of the most consistently reported timeshare scams to state AGs and the Better Business Bureau, and the promised buyer never materializes. Legitimate resale brokers earn commission on a completed sale; they don't need cash from you before finding a buyer.

Where does a $149 exit kit fit into all of this?

It fits as a starting point, not a substitute for the steps above. ExitHonest sells a one-time $149 Timeshare Exit Kit that walks owners through checking their rescission window, drafting a compliant cancellation letter, understanding deed-back eligibility, and building a paper trail before they ever consider paying a larger exit company or a lawyer. It does not contact the resort or developer on your behalf, it is not a law firm, and it cannot promise any particular cancellation or exit outcome, because no legitimate service can promise that. What it can do is help you figure out, cheaply, whether you're still in a rescission window, whether your resort has a deed-back program, and what a legitimate next step looks like before you spend thousands on a company you can't fully vet. If you're at the research stage, the exit kit builder is a reasonable place to start before signing anything with a paid exit firm.

What should you do right now if you already paid an exit company that did nothing?

File a complaint with the FTC at reportfraud.ftc.gov and with your state attorney general's consumer protection division; both agencies use these complaints to identify patterns and build enforcement cases, even when they can't resolve your individual complaint directly. Pull your original contract with the exit company and check for a right-to-cancel clause of its own; some states require these contracts to include a short cancellation period too. Dispute the charge with your credit card company if you paid within the chargeback window. Under the Fair Credit Billing Act, a written billing error notice must generally be sent within 60 days of when the first statement showing the charge was mailed to you, as set out in the FTC's consumer guidance on disputing credit card charges, though many card issuers will look at older disputes case by case ^[5]. Keep every email, invoice, and phone log. If a state AG or the FTC later brings a case against the company you paid, documented complaints are exactly what builds that case, and consumers who filed complaints are often the ones who show up on a restitution list.

Frequently asked questions

How to get out of a timeshare?

Start by confirming whether you're still inside your rescission window, since that's the fastest legal exit; check your contract and your state's statute. If that window has passed, ask the resort about a deed-back or surrender program, try the resale market with realistic price expectations, or consult a vetted exit company. Never pay large fees to a company that promises a specific outcome.

How do you get out of a timeshare after the rescission period ends?

You'll typically need a deed-back program (returning the deed to the resort, sometimes for a small fee), a resale (usually for little to no money), or a hardship-based negotiation directly with the developer. There's no universal legal exit after rescission; each path depends on your specific resort's policies and your contract terms.

How to sell a timeshare without losing more money?

List through the resort's own resale program first if one exists, or use a licensed resale broker verified through your state's real estate licensing board. Expect little or no profit; many timeshares resell for $1 or less because ongoing maintenance fees make them unattractive. Never pay an upfront fee to a caller who claims a buyer is already lined up.

How to get rid of a timeshare you inherited?

You are not automatically required to keep an inherited timeshare; heirs can often disclaim (formally refuse) the inheritance before accepting any benefit from it, which avoids taking on the maintenance fee obligation. Consult the estate's probate attorney about disclaiming, and separately ask the resort about deed-back options for inherited units.

Are timeshares scams?

The timeshare product itself is legal and regulated, so it isn't a scam in a legal sense, though sales tactics are frequently high-pressure and resale value is nearly zero. The bigger scam risk sits in the exit industry: many companies charge large upfront fees and deliver nothing, a pattern the FTC has sued over directly.

How much is a timeshare?

Average purchase prices for new timeshare intervals have run roughly $19,000 to $24,000 in recent industry survey data from the American Resort Development Association. Prices vary widely by brand, location, season, and unit size; resale prices are typically far lower, often near zero, because of ongoing fee obligations.

How much do timeshares cost per year in maintenance fees?

Annual maintenance fees commonly range from about $1,000 to $2,000 or more per interval, and they typically rise a few percent most years. Special assessments for major repairs or storm damage can add thousands more in a single year, on top of the regular annual fee.

Can you sue a timeshare exit company that took your money and did nothing?

Yes, generally under breach of contract or state deceptive trade practices law, and small claims court works for smaller amounts without needing a lawyer. Collecting on a judgment is the harder part if the company has no real assets. Filing a complaint with the FTC and your state AG is free and helps build broader enforcement cases.

Has the FTC won any lawsuits against timeshare exit companies?

Yes. In 2021 the FTC and the Washington Attorney General sued Consumer Advocacy Center Inc., doing business as Timeshare Exit Team, and related defendants, alleging deceptive advance-fee practices under the FTC Act and the Telemarketing Sales Rule, resulting in a settlement that included monetary judgments and business restrictions on the defendants.

What are the warning signs of a timeshare exit scam?

A promise of a fast or effortless exit, large upfront fees with no escrow protection, pressure to stop paying your mortgage or maintenance fees, unsolicited cold calls claiming resort partnership, and no verifiable physical business address are the core red flags the FTC and state attorneys general describe repeatedly in complaints.

Should I stop paying my timeshare maintenance fees while I try to exit?

No. Stopping payments you legally owe can trigger default, foreclosure proceedings, and serious credit damage, regardless of what an exit company advises. Any legitimate exit strategy should not require you to breach your existing contract obligations first.

How do I check if a timeshare exit company is legitimate before paying?

Check the company's standing with your state attorney general's consumer protection office and the Better Business Bureau, ask for references you can independently verify, confirm whether fees go into a third-party escrow account, and walk away from anyone who promises a specific outcome or timeline.

Sources

1. FTC v. Consumer Advocacy Center Inc. d/b/a Timeshare Exit Team, Case No. 2:21-cv-00191 (W.D. Wash.): 2021 FTC enforcement action against Timeshare Exit Team-affiliated companies alleging deceptive advance-fee practices
2. Wisconsin Statutes section 100.18, Fraudulent representations: Wisconsin's deceptive trade practices statute prohibits false or misleading representations to induce a consumer into a contract and allows private claims
3. FTC Consumer Sentinel Network Data Book 2023: FTC tracks fraud complaint data including advance-fee and business opportunity fraud categories annually, logging over 2.6 million reports in 2023
4. American Resort Development Association, 2023 State of the Vacation Timeshare Industry: Industry survey data on average timeshare purchase prices
5. Federal Trade Commission, Disputing Credit Card Charges: Consumers must generally send a written billing error notice within 60 days of the statement date under the Fair Credit Billing Act