Owning a timeshare can be so expensive that, if you inherit one, you may want to refuse to take it by filing something called a “disclaimer of interest”.
This may be a surprise because typically inheriting something is a good thing. That's not necessarily the case with timeshares because a significant amount of them are basically worthless.
Even if you are bequeathed a timeshare that is totally paid off, you'll still have to pay monthly maintenance fees for as long as you have it. These maintenance fees can be $700-$800 a month or more. At $800 a month, you'll be paying $9,600 a year to use a timeshare for one week a year. Some deal.
Accepting the timeshare, using it for a while, and then selling it may not be an option because they're often difficult or impossible to sell. There are many other people trying to sell timeshares, which puts downward pressure on prices. Some timeshares are being sold on Ebay for $1 with more than a thousand dollars in purchase incentives. You can't even give some timeshares away!
Filing A Disclaimer of Interest
Fortunately, you can avoid the nightmare of timeshare ownership by not accepting it in the first place. You can legally disclaim an inherited timeshare by filing a document called a disclaimer of interest, also known as a renunciation.
A disclaimer of interest must be made in writing and filed in the appropriate office in the county where the timeshare is. It has to describe the timeshare that's being disclaimed, and must be signed by the person doing the disclaiming and two witnesses, one of which must be a notary.
Here are some additional things about disclaimers of interest and inheriting a timeshare that you should know:
Time is of the essence. There is a limited amount of time in which you can file the disclaimer. From the time of the death of the owner, you'll probably have nine months. The laws vary by state.
Filing a disclaimer of interest is irrevocable. You won't get another opportunity to take the timeshare after you've disclaimed it, and you can't disclaim after you've taken it and used it.
You may need to hire an attorney to help you write and file a disclaimer of interest.
If you decide to file a disclaimer of interest, you should let your relatives know what you're doing. If you disclaim it, the next person with a claim to it will have an opportunity to take it. If they don't want it, they will have to file their own disclaimer of interest.
It's also recommended that you send a copy of the death certificate to the resort and lending bank. If the resort doesn't know that the owner of the timeshare died, they could bring a foreclosure lawsuit. Sending the death certificate will keep them informed of what's happening and prevent a foreclosure action.
If you have a relative who dies, I hope they leave you some cash or property that has actual value, and not a terrible timeshare that is just a headache. If you've already have a timeshare and would like to get rid of it, there are ways to do that, which you can read about here.