The Dangers of “in Perpetuity”

The public is being warned of investing in timeshares, with payments based on an “in perpetuity” basis.

In one example, a couple bought such a timeshare in Stirlingshire, with annual management fees exceeding £500.

Eventually, the husband passed away leaving outstanding debts. In an attempt to address the situation, his wife inquired as to how she could cancel the management fees. Unfortunately, the managing director of the timeshare company stated that in his opinion, it was the responsibility of the Executors of the deceased’s Estate to make provision for such debts. The victim has been advised that she must declare bankruptcy and that any monies left over in the Estate will be frozen accordingly, so that the timeshare company can continue to recover their fees on a yearly basis.

Of course, one viable option would be to sell on the timeshare. However, the current property climate means there is almost no market for second-hand timeshares, and relatives will of course not want to inherit a timeshare and its substantial costs.

The advice then is to be wary of entering into any “in perpetuity” financial commitment which may well prove to be extremely difficult to settle. Do not be fooled either into thinking that if you enter into a joint agreement, that this type of contract will be settled on the death of your partner. Make a point of asking the timeshare company about such eventualities, before you are persuaded to sign on the dotted line and potentially find yourself in considerable debt.

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