What happens if you default on timeshare maintenance fees

Last updated 2026-07-26

what actually happens if you stop paying timeshare maintenance fees

Nothing happens the day you miss a payment. But the clock starts immediately, and the resort's collection process is more organized than most owners expect. Most timeshare contracts specify a grace period, often 10 to 30 days, before a late fee attaches. After that, interest starts compounding on the unpaid balance, and resorts frequently charge annual rates in the high teens to mid-20s percent, similar to a credit card. Some contracts also add a flat late fee each billing cycle on top of interest. If you stay delinquent past 60 to 90 days, most resorts turn the account over to an internal collections department or a third-party collection agency. At that point you'll get calls and letters, and the account may be reported to the credit bureaus as a collection item, which can knock 50 to 100+ points off a credit score depending on your starting point and history. Keep going past that, usually somewhere between 6 months and 2 years depending on the resort's internal policy and your state's lien and foreclosure rules, and the HOA or resort can record a lien against the timeshare interest itself. From there, foreclosure (or in deeded-property states, a lawsuit for a money judgment) becomes the resort's real tool for forcing the issue. None of this happens instantly, and none of it is automatic nationwide. The exact timeline depends on your contract, your state's foreclosure statutes, and how aggressive that particular resort or management company chooses to be.

will i get sued or foreclosed on for unpaid maintenance fees

Yes, this is a real possibility, not a scare tactic. Timeshare associations have two main tools: lien foreclosure on the timeshare itself, or a personal lawsuit for the money owed. For deeded timeshares (real property interests), the association usually has a lien right built into the CC&Rs (covenants, conditions, and restrictions) that were recorded against the property when you bought in. Many states allow non-judicial foreclosure of these liens, similar to how a mortgage lender forecloses, which is faster and cheaper for the resort than going to court. Florida, for example, permits a trustee foreclosure process for timeshare liens under its statutory scheme for timeshare estates ^[1]. For right-to-use timeshares (a contract right rather than a deed), the association more often sues for breach of contract and seeks a money judgment, which can then be enforced through wage garnishment or bank account levies depending on your state's judgment-collection laws. In practice, small dollar amounts (a few hundred to low thousands in fees) usually don't trigger a lawsuit quickly, because litigation costs money too. Resorts often let a balance ride for a while, layering on interest and late fees, before deciding foreclosure or suit is worth it. But once a resort or its collection agency decides to act, deeded timeshare foreclosure is genuinely faster than home foreclosure in many states, sometimes wrapping up in a matter of months rather than years.

will unpaid timeshare fees hurt my credit score

Almost certainly, if the account goes to collections or gets charged off. The Fair Credit Reporting Act allows most negative information, including collection accounts, to stay on your credit report for up to 7 years from the date of the original delinquency ^[2]. A collection account for even a modest balance, a few hundred to a couple thousand dollars in overdue fees, can be enough to trigger a meaningful score drop, and it will show up to any lender pulling your report, more than timeshare-related lenders. This matters if you're planning to buy a car, refinance a mortgage, or apply for a new credit card in the next several years. Some owners assume a small industry (timeshare debt) won't get reported the way a credit card would. That's wrong. Resorts and their collection agencies report to Equifax, Experian, and TransUnion just like any other creditor, and the Consumer Financial Protection Bureau has fielded consumer complaints specifically about timeshare debt collection and credit reporting practices through its public complaint database ^[3].

can i go to jail for not paying timeshare maintenance fees

No. Unpaid maintenance fees are a civil debt, not a crime. You cannot be arrested or jailed for failing to pay a timeshare maintenance fee in the United States. Debtor's prisons were effectively abolished in the 19th century, and modern collection remedies for unpaid consumer or contract debt are limited to civil tools: liens, foreclosure, lawsuits, wage garnishment (after a judgment), and credit reporting. If a collector threatens jail time, that's a red flag for an illegal collection tactic. The Fair Debt Collection Practices Act prohibits debt collectors from threatening actions they can't legally take, and threatening arrest for a civil debt qualifies ^[4]. You can report that kind of threat to the Federal Trade Commission and your state attorney general.

what happens to unpaid fees if you inherit a timeshare

Heirs are not automatically stuck with a deceased owner's timeshare debt, but the estate is. If you inherit a timeshare through a will or intestate succession and you don't want it, you generally have the right to disclaim the inheritance, refusing to accept the property before you take any ownership action (like using it or paying fees on it). Once you disclaim, in most states you're treated as if you never inherited it, and the timeshare interest passes to the next heir in line or reverts to the estate, which the resort can then pursue for back fees through probate. The Uniform Probate Code's disclaimer provisions, adopted in some form by many states, generally require the disclaimer to be made within 9 months of the death for federal tax purposes, though disclaimer timing for pure inheritance-refusal purposes varies by state law ^[5]. The mistake people make is using the timeshare (booking a week, paying a fee) before deciding whether to disclaim. That can count as accepting the property, which forecloses the disclaimer option. If you've inherited a timeshare you don't want, talk to a probate attorney in the deceased's state before you touch it.

is it better to just stop paying and let the resort take it back

This is the single most common question owners ask, and the honest answer is: it depends on your state's foreclosure process, your credit tolerance, and how much you still owe versus the timeshare's real value. Here's the tradeoff. If you stop paying, you avoid throwing more money at an asset you don't want. But you're not in control of the outcome. Deficiency judgments (where the resort sues you for the difference between what you owe and what the foreclosed unit sells for) are possible in some states even after foreclosure, and the credit damage and collections hassle can drag on for years before the resort actually forecloses and closes the account. We are not advising you to stop paying fees you owe under your contract, and you shouldn't treat non-payment as a clean shortcut. It's a real financial event with real consequences, not a workaround. The better first move, especially if you're still inside your state's rescission window, is to check whether you can legally cancel the contract outright. See how to get out of a timeshare for the state-by-state rescission mechanics, because canceling during that window erases the debt and the ownership cleanly, no foreclosure, no credit hit.

can i just cancel the timeshare instead of defaulting

If you're still inside your state's rescission period, yes, and this is almost always the better path than letting fees go unpaid. Every state that permits timeshare sales has a mandatory rescission (cooling-off) window written into its statutes, during which a buyer can cancel for any reason and get their money back, no explanation required. The windows are short and vary widely. Some states set it at 3 business days, others go up to 15 days or more, and the clock usually starts from the date you sign or the date you receive all required disclosure documents, whichever is later. Confirm your state's rescission window directly, because getting the date wrong is the single most common way owners blow their only clean exit. If your rescission window has already closed, canceling isn't automatic anymore, but it's not the only option either. Deed-back programs, where the resort takes the property back voluntarily (sometimes for a fee, sometimes free), exist at many major resort systems. Read up on timeshare cancellation options and how deed-backs actually work before assuming default is your only move.

how do you get out of a timeshare that you can't afford anymore

Start with the free and legitimate options before anything else. First, confirm whether you're still in your rescission window; if so, cancel through the statutory process, in writing, following your state's exact requirements. Second, ask the resort directly about a deed-back or surrender program; several major chains (some Marriott Vacation Club, Hilton Grand Vacations, and Wyndham properties, among others) run internal deed-back or 'exit' programs that let owners return the deed without a resale, sometimes for a processing fee rather than a large payout. Third, if the resort won't take it back and you can't sell it (timeshares have almost no resale market; more on that below), get real legal or consumer counseling before hiring any company that demands a large upfront fee to promise an easy way out. The FTC has warned repeatedly about timeshare resale and exit scams that charge thousands upfront and deliver nothing ^[6]. Our Timeshare Exit Kit is built for this stage: a $149 one-time toolkit that walks you through checking your rescission eligibility, drafting deed-back and cancellation request letters, and building a paper trail with the resort, without an upfront fee model that promises results it can't control. It doesn't replace a lawyer for complex ownership disputes, but it covers the paperwork most owners are stuck on.

how much does a timeshare cost, and why do fees keep rising

Purchase prices vary enormously depending on the brand, location, and points system, but industry surveys give a rough range. The American Resort Development Association's (ARDA) owner research has put the average timeshare purchase price in the $20,000 to $24,000 range in recent years, though prices for luxury branded weeks or large points packages run well above that, and resale prices are often a fraction of the original developer price ^[7]. Maintenance fees are the recurring cost that catches owners off guard. ARDA-affiliated survey data has cited average annual maintenance fees somewhere around $1,000 to $1,100 per interval in recent years, and these fees are not fixed. They typically rise with inflation, special assessments for repairs, and resort renovation costs, and increases of 5 to 10% a year are common industry experience, not an outlier. Special assessments are the other shock. These are one-time charges, on top of the regular annual fee, levied when a resort needs a new roof, storm repairs, or a major renovation, and they can run into the thousands of dollars depending on the project and how many owners are splitting the cost.

how much are timeshares really worth on resale

Far less than owners expect, often close to nothing. The resale market for timeshares is famously weak; units frequently list for $1 on resale sites because sellers just want out of the maintenance fee obligation, not because they expect a payout. The core problem is supply. Millions of existing owners want out every year, deed-back and exit demand is high, and developers keep selling new inventory directly, so resale buyers have almost no reason to pay a premium for a used week when a broker or the resort itself is marketing new ones. ARDA's own research acknowledges the secondary market is thin and prices are typically a small fraction of the original purchase price ^[7]. If you're trying to sell, be realistic: a legitimate sale (through a licensed real estate agent handling timeshare resales, or a reputable timeshare resale marketplace) might net you a small amount or nothing at all after transfer fees, but it at least exits you from future maintenance fee obligations cleanly, which is the real win. Be suspicious of any company that calls out of the blue claiming they have a 'buyer waiting' for your unit and demands an upfront fee to close the deal. That's one of the most common scam patterns state attorneys general warn about repeatedly.

are timeshares scams, or is it more complicated than that

The timeshare product itself isn't illegal, and plenty of owners genuinely enjoy the vacations for years. But the sales and exit ecosystem around timeshares has a well-documented scam problem, and it's fair to be suspicious. On the sales side, high-pressure presentation tactics, exaggerated resale value promises, and understated maintenance fee growth are common complaints tracked by state attorneys general and the FTC. On the exit side, upfront-fee exit companies that promise a fast, no-questions cancellation and then disappear, or that instruct owners to stop paying fees (which just adds foreclosure and credit damage to the pile), are a recurring enforcement target. The FTC has warned consumers about deceptive timeshare resale and exit company practices, including illegal upfront fee demands ^[6]. The honest framing: timeshares are a legitimate but often overpriced and hard-to-exit product, and the exit industry that sprung up around owner regret has its own scam layer on top. Read our timeshare exit companies guide before signing anything, and never wire money or pay a large fee upfront to a company that cold-called you.

what should i do first if i'm behind on maintenance fees right now

Get the facts before you make any decision. Pull your original contract and figure out exactly what state's law governs it (usually the state where the resort is located, not necessarily where you live), and check whether any rescission right could still apply, some states have reopened or extended rescission rights in specific disclosure-violation situations, though this is rare and fact-specific. Call the resort's owner services line yourself and ask directly about hardship programs, payment plans, or a deed-back option. Many resorts would rather restructure a payment plan or take a deed back for free than spend money on collections and foreclosure, especially for older or lower-demand properties. If collectors are already calling, know your rights. The Fair Debt Collection Practices Act limits when and how often they can contact you, and bans threats, harassment, and false statements about what they can legally do to you ^[4]. Keep a written log of every call. And if you're evaluating whether a professional exit service is worth paying for, check that company against your state attorney general's consumer complaint database and the Better Business Bureau before paying anything upfront.

Frequently asked questions

How to get out of a timeshare?

Start by checking your state's rescission window; if you're still inside it, cancel in writing following your state's exact statutory process. If that window closed, ask the resort about a deed-back or surrender program, or consult a consumer attorney. Avoid any company demanding a large upfront fee for a fast, no-questions exit; that's a common scam pattern the FTC warns about.

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

Ask the resort directly about a deed-back, surrender, or 'exit' program; several major chains run these internally, sometimes for a processing fee. If that's not available, consider a licensed resale broker (expect little to no payout) or consult a consumer attorney about your options. Never pay large upfront fees to a company promising a fast cancellation with no real work behind it.

How to sell a timeshare?

Use a licensed real estate agent who specializes in timeshare resales, or a reputable resale marketplace, and set expectations low; many timeshares resell for very little because supply massively outweighs demand. Never pay an upfront fee to a company that cold-calls claiming a buyer is waiting; that's one of the most common timeshare resale scams the FTC has pursued enforcement over.

How to get rid of a timeshare you can't afford?

Check your rescission rights first, then ask the resort about a deed-back program before assuming you're stuck. Keep paying fees while you sort this out; defaulting triggers collections, credit damage, and potentially foreclosure. A hardship or payment plan conversation with owner services is often more productive than owners expect.

Are timeshares scams?

The product itself is legal, but the sales tactics (high pressure, inflated resale value claims) and a large chunk of the exit industry (upfront-fee companies promising fast, easy cancellations) have well-documented scam problems tracked by the FTC and state attorneys general. Treat any unsolicited exit or resale offer with real skepticism.

How much is a timeshare, on average?

Industry survey data from the American Resort Development Association has put average purchase prices around $20,000 to $24,000 in recent years, though this varies widely by brand and points package size. Annual maintenance fees have averaged roughly $1,000 to $1,100 per interval, and both figures tend to rise year over year.

What happens if you just stop paying timeshare maintenance fees?

Late fees and interest (often 18-24% APR) start accruing quickly, followed by collections calls within 60-90 days, then credit bureau reporting, a lien on the timeshare, and eventually foreclosure or a lawsuit for a money judgment, depending on your state and contract. It won't result in jail, but it can seriously damage your credit for years.

Can a timeshare company garnish my wages for unpaid fees?

Only after suing you and winning a money judgment in court; unpaid fees alone don't allow garnishment automatically. Whether wage garnishment is even legally available depends on your state's judgment-collection laws, since some states restrict or limit wage garnishment for consumer debts more than others.

Does unpaid timeshare debt affect my credit score?

Yes, if the account is reported to a collection agency or charged off, it can appear on your credit report for up to 7 years under the Fair Credit Reporting Act and can meaningfully lower your score, the same as any other collection account would.

Do I inherit my parents' timeshare debt automatically?

No. You can typically disclaim (formally refuse) an inherited timeshare before using it or paying fees on it, which generally prevents the ownership and debt from transferring to you. The estate, not you personally, remains responsible for unpaid fees. Talk to a probate attorney in the deceased's state before touching the property.

Can I go to jail for not paying my timeshare fees?

No. This is a civil debt, not a crime, and you cannot be arrested or jailed for failing to pay it. If a collector threatens jail time, that's an illegal collection tactic under the Fair Debt Collection Practices Act, and you can report it to the FTC and your state attorney general.

Is a timeshare deed-back program free?

Sometimes, but not always. Some resort deed-back or surrender programs are free if the account is current; others charge a processing fee, and some require the account to have no outstanding balance before they'll accept the deed back. Ask the resort's owner services department directly what their current program requires.

Sources

1. Florida Legislature, Chapter 721 (Florida Vacation Plan and Timesharing Act): Florida's statutory scheme allows a trustee foreclosure process for timeshare liens
2. Consumer Financial Protection Bureau, Fair Credit Reporting Act summary: Negative credit information, including collection accounts, generally may be reported for up to 7 years
3. Consumer Financial Protection Bureau, Consumer Complaint Database: CFPB has received consumer complaints specifically about timeshare debt collection and credit reporting
4. Federal Trade Commission, Fair Debt Collection Practices Act: Debt collectors are prohibited from threatening actions they cannot legally take, including threats of arrest for civil debt
5. Uniform Law Commission, Uniform Probate Code disclaimer provisions: Disclaimer of an inheritance generally must meet state-law timing and procedural requirements
6. Federal Trade Commission, "Thinking About a Timeshare Exit Company?" consumer alert: FTC has warned about deceptive timeshare resale and exit companies charging illegal upfront fees
7. American Resort Development Association (ARDA), State of the Vacation Timeshare Industry fact sheet: Average timeshare purchase prices and average annual maintenance fees reported by industry survey data