Huh, I Didn’t Know Our Resort Even Had a Transfer Policy!

TTR started out as an online database for five of the timeshare resorts with which the principals of Grant Wolf, Inc. are association consultants or are Board Members.  In January 2010, we performed an audit of the member rosters of these five resorts. These resorts were developed and sold out in the 1980’s and 1990’s. Starting from that initial audit, our efforts have developed into an on-line database named the Timeshare Transfer Registry® that we believe will assist timeshare Associations in managing what has become a real threat to their sustainability.

As part of this project, we worked with two very experienced timeshare attorneys, to develop a set of transfer policies. We specifically were interested in developing a set of procedures that could be applied to all prospective transferees uniformly and that were not only reasonable but met the Associations’ duties as set forth in the resorts’  governing documentation.

What we were surprised to discover was that the Declarations of all five of the resorts already had “Notification of Sale of Time Share Interest” provisions which uncannily defined procedures that 30 years after they were written, were directly applicable to dealing with the challenges presented by the unburdening operations of today. Had these provisions been enforced,and the resorts were aware of the practices of the unburdening companies, I wouldn’t be writing this today.

With very slight modification, we were able to develop the model transfer policy language that TTR recommends:

Not later than (30) days before the voluntary or involuntary sale, transfer or assignment of any Vacation Ownership, Timeshare Interval or Timeshare Estate the current Member shall notify the Association in writing. The current Member or their authorized escrow agent shall submit a Standardized Vacation Ownership Estoppel request, a Company Resolution from the proposed transferee (if a Corporation, Trust or Company), a Membership Application from the proposed transferee and a pro forma of the conveyance document prior to its recordation. In the absence of such notice and required documentation, and prior to the Association’s approval of the recordation of the conveyance documents, the Association shall not be required to recognize the transferee for any purpose. Any action taken, prior to the giving of such notice and required documentation by the transferor, as an Owner, shall be recognized by the Association. Prior to receipt of any such notification and documentation by the Association, any and all communications required or permitted to be given by the Association shall be given to the Owner.

We suggest that you review the governing documents to see if your resort has  similar language already in place. Even if you can’t find the exact language, Associations are universally granted certain general powers and duties (duties being the operative word). These would include:

  1.  To adopt, publish and enforce, from time to time, Association Rules.
  2. To levy and collect and enforce Assessments.
  3. To compile a roster of the names and addresses of each Owner (the “Roster”).
  4. Enforcement by legal action of the provisions of the governing documents.
  5. The power of foreclosure for failure to pay assessments.

These are really the only duties that your Association needs to be charged with by the governing documents in order to to adopt TTR’s recommended transfer policy.