The Florida Vacation Plan and Timesharing Act (HB 7025) went into effect on July 1, 2013 and was one of the most significant restructuring of the timeshare landscape in years.
The bill was designed with a noble purpose: to rid the industry of the Viking Ship timeshare transfer scheme.
A “Viking Ship” scheme refers to a process by which a timeshare exit company will transfer a timeshare property into a “shell” company, which is a corporation or limited liability company (LLC) that is created without any assets or real operations. This shell company is set up exclusively for the exit company to transfer your timeshare into in order to make it appear to the timeshare resort that the “shell” company is the new owner of your timeshare.
The exit company then transfers as many timeshare interests into it as possible for the sole purpose of having the timeshare resort charge the “shell” company all maintenance fees, special assessments, and taxes, but the exit company intends that the “shell” company will never make payment for those fees, assessments, and taxes. Eventually, the resort is forced to initiate foreclosure against these unpaid timeshare interests.
Ultimately, you (the timeshare owner) may be responsible for all these unpaid payments and the risk of foreclosure against you The “Viking Ship” scheme became so common that laws were enacted to protect the timeshare resorts against it. The laws state that where this scheme is put into effect, the timeshare would actually revert back to you, the timeshare owner — meaning that you would resume your timeshare ownership and all related financial responsibilities.
This practice costs timeshare developers and resorts millions every year, as maintenance fees are their primary revenue stream. Often times, in order to make up for the loss, resorts simply raise the annual maintenance fees for those remaining owners who have stuck to their initial agreement, even if they haven’t always been happy with their timeshare property. So, it has become a circular problem: Owners grow tired of exorbitant maintenance fees, they, in some cases, unknowingly transfer their properties to a Viking Ship company, the developer forecloses and re-lists the property, and everyone’s maintenance fees continue to rise.
Thankfully, this legislation was aimed at ridding the timeshare industry of Viking Ship schemes, while still allowing legitimate transfer companies to continue to help unsatisfied timeshare owners to terminate their timeshare contract in an ethical, amicable fashion. It’s important to consider all of your options and then act accordingly to remove your family from your timeshare agreement and avoid having to pay your annual maintenance fees.
The best course of action is to always stay as informed as possible about any decisions you’ll be making about your timeshare. If you have questions about ending your timeshare ownership, we invite you to reach out to us and speak with one of our expert consumer advisors. Simply call us at 877-354-4321 to take that vital first step toward financial (and timeshare) freedom for you and your family.
5 thoughts on “Timeshare Exit Insights – What is a Viking Ship Scheme?”
they are really professional.
This is great. NewtonGroup is really amazing.
Great News! The law DOESN’T apply to owners!
I went and read the entire law myself. The section relating to “Viking Ship” schemes ONLY relates to the title transfer company acting in a third party activity. Many people mistakenly think the use of “No person shall participate…” means everyone. According to the statute in only relates to third party title transfer services.
Sill Bad News – because of this many ethical and legal title transfer companies now refuse to deal with Florida timeshares.
Comments are closed.