Timeshare Terminology

Amenities: Properties or resorts offer extra desirable features that increase the value of one’s stay. Resort amenities often include swimming pools, tennis courts, Jacuzzi, spa and fitness facilities, golf, boating, skiing, water sports, amusement park discounts and various planned children’s activities. Many amenities are standard features and others carry an additional cost (such as golf, spa services, watersport equipment, etc.), depending on the resort.

 

American Resort Development Association (ARDA): The professional association representing the vacation ownership and resort development industries. Members range from privately held companies to publicly traded companies and international corporations with expertise in shared ownership interests in leisure real estate. The membership also includes timeshare owner associations (HOAs), resort management companies, and consumer owners through the ARDA Resort Owners Coalition (ARDA-ROC). ARDA has a Code of Ethics that defines key elements of the vacation ownership and community-development business and outlines appropriate practices that each individual and member company is required to follow. Please visit www.ARDA.org for more information.

 

Biennial: A vacation ownership product that provides a week’s worth of accommodations every other year. These owners are often referred to as either “odd” or “even” year owners.

 

Bonus Weeks: In an effort to increase travel to certain destinations, resort and exchange companies offer bonus weeks to their members for a modest rental fee, without requiring the members to relinquish a week in return. Developers may also offer unreserved weeks to their owners in a similar fashion.

 

Closing Costs or Fees: Expenses paid by the buyer and/or seller at the time of closing. Typically applies to deeded purchases, as with any real estate transaction.

 

Condo Hotel: Condo hotels offer of a portion of their hotel room inventory for sale to the public. The owner may use it for vacation or corporate housing needs, or place it in a rental program typically managed by the hotel.

 

Condominium: A type of ownership of real property where there is ownership of an individual unit (or week) within a multiple-unit building or complex. Individual owners get fee title to the space as well as a percentage ownership interest in the balance of the project, including surrounding recreational facilities.

 

Deed: The document used to convey an interest in real property, where title to the real property transfers from one party to another.

 

Destination Club: Members are not buying a specific property/real estate, but rather the right to use at any of a portfolio of homes owned or operated by the club company. With few exceptions, they offer a non-equity based membership emphasizing a broad selection in vacation home experiences.

 

Developer: The party or company owning the property, unit/weeks or club memberships. The developer is responsible for constructing the accommodations and amenities on-site, selling the product and in many cases, providing management services for the property.

 

Exchange: An exchange company allows existing owners to trade their timeshare interests for comparable accommodations and travel-related services. Most resorts are affiliated with an exchange company, and many resort companies also offer an internal exchange mechanism that allows owners to exchange to resorts within their resort group. If an internal resort exchange is mandatory or long-term, it is usually considered to be a vacation club. Fractional and private residence club resorts may offer exchange opportunities for their owners as well. Some exchange companies have a special program for fractionals and private residence clubs.

 

Fixed Ownership: A type of timeshare ownership in which the owner knows the specific week(s) within a given year in which he has access to the accommodation year after year.

 

Floating Ownership: A timeshare arrangement in which owners reserve each year’s vacation time on a first-come, first-served basis. At most resorts with a floating program, unit allocation also floats, assuring owners comparable accommodations but not necessarily the same unit each year. Access may float within a season or year round.

 

Fractional/Private Residence Club: Resort accommodations with related use rights in increments of more than two weeks and sometimes as long as three months (quarter share). This type of ownership is almost always deeded and is a more affordable alternative to a second home. This product segment enjoys a high level of service and is considered the luxury tier of shared ownership.

 

Homeowners’ Association (HOA): All the owners of a property that are responsible for operating, managing and administering the project and may also own the common areas and elements jointly. Membership in the owners association generally is mandatory and operates at the direction of an elected board of directors. In most deeded resorts, the HOA will ultimately be responsible for managing the resort and usually hires a management company (including the developer) to operate the resort on a day to day basis.

 

Home resort: The resort location where a new purchaser owns or has a designated week in a club or points-based program. Ownership is usually tied to this home resort and generally involves priority reservation rights in that location.

 

Interval or Weekly Interval: The set number of days and nights of annual use,usually one week. by which vacation ownership is measured.

 

Lock-off: A type of timeshare unit consisting of multiple living and sleeping quarters designed to function as two discrete units for purposes of occupancy and exchange. The unit can be combined to form one large unit or can be split or “locked-off” into two or more separate units, allowing the owner to split the vacation into multiple stays or bank all or a portion for exchange purposes.

 

Maintenance Fee: Also called an annual assessment. A fee that timeshare owners are required to pay, usually on an annual basis, to cover the costs of running the resort, including daily management, upkeep, and improvements. Real property taxes may be included in the fee or billed separately.

 

Plan Year: The 365-day period within which an annual allotment of points must be used.

 

Points: A “currency” that provides highly flexible scheduling. Purchasers buy points based upon their estimated vacation needs, then use those points as they desire in any given year to reserve different combinations of accommodation sizes, locations and seasons, and may also acquire a variety of travel related services depending on the rules of the resort company. Resort accommodations are assigned a point “value” based upon unit size, length of stay, locations and seasonality. Points are used by some resort companies for both internal and external exchange.

 

Points Conversion Program: An offering whereby owners of a timeshare interval(s) pay(s) a fee to convert their interval for the equivalent in points.

 

Private Residence Club: See Fractional/Private Residence Club

 

Rescission: The period of time granted under state law during which a purchaser can cancel the purchase contract without penalty and receive a complete and full refund of all monies paid to the seller. Dictated by state statute and company policy, timeshare rescission periods vary from state to state, but range from three to 10 days, the most common being five days.

 

Resort Company: The company owning the resort, usually responsible for building and selling the accommodations and amenities. See “developer.”

 

Right-to-Use: A timeshare owner’s right to occupy a unit at a resort for a specified number of years and where no real estate interest is conveyed. Right-to-use owners do not receive a deed.

 

Timeshare Documents: Called by various names under state law (including project instruments) and depending on the project’s structure, these are the legal documents which establish and structure the vacation ownership resort or club. These documents may include a declaration, owners association articles and bylaws as well as rules and regulations.

 

Timeshare: Traditional timeshares regardless of whether they are backed by a deed or not, allow buyers to purchase an increment of time, typically one week, in a condominium, villa or apartment type of furnished vacation accommodation. Timeshare owners receive either a fixed week or a floating time reservation arrangement that may vary by unit type and season. More than two-thirds of timeshare interests today are deeded.

 

Trial Membership: An opportunity to experience the developer‘s primary vacation ownership product and services within a defined period of time after the initial sales tour.

 

Unit or Villa: The portion of a timeshare condominium, fractional, or club membership that is for the owners’ use.

 

Unit Week: The basic form of vacation ownership accommodations, consisting of the use of a dwelling unit for a seven day period from check-in to checkout.

 

Vacation Club: A marketing term often used to describe various types of timesharing that usually involves use or access to more than one resort location. Real estate ownership or points are included in this type of timeshare vacation club, and provides vacation flexibility to the owner. However, the term may also be used to describe travel clubs that offer discounts on hotels and other travel related services.

 

Vacation Ownership: A term often used to describe resort timesharing and other forms of shared ownership of leisure real estate, such as a fractionals and private residence clubs.