Utah Sen. John Curtis on Friday joined personal finance expert Dave Ramsey on “The Ramsey Show” to discuss the timeshare industry and Curtis’ plan to protect consumers with the Timeshare Transparency Act.
Ramsey referred to the timeshare industry as “legalized fraud.”
During the interview, Ramsey and Curtis highlighted years of financial data and consumer complaints that show how the majority of timeshare buyers regret their decisions but are locked into long-term contracts with escalating fees.
Ramsey said that 85% of all timeshare buyers regret their purchase but can’t cancel it because of a short rescission window.
“Let’s face it, if 85% of the people regret getting into it, there needs to be some way for them to get out of it,” Curtis said.
Ramsey said that many people try to get out of their timeshares by selling them since they can’t back out of the contracts.
“There’s no backing out and there’s no way to sell the stupid thing because nobody wants to buy them. There are hundreds and hundreds and hundreds of them for sale on eBay for $1,” he said.
The pair agree many seniors who are on vacation away from people they trust get locked into contracts.
“They’re away from their normal support structure when they get into these very, very high-pressure sales techniques, then they maybe make a bad decision, and then they don’t have a window to change that decision,” Curtis said. “That’s just wrong.”
What is the Timeshare Transparency Act?
The Timeshare Transparency Act aims to regulate the timeshare business while providing consumers more clarity on what they’re actually purchasing.
The legislation was recently introduced by Curtis and Sen. Adam Schiff, D-Calif. Curtis briefly explained to Ramsey what it does.
“First, you should know what you’re buying — there should be transparency; second, you should know if there’s going to be radical changes to what you’ve bought; and third, you should be able to change your mind within an agreed upon period of time.”
The bill includes a 14-day free cancellation period which Ramsey claimed would cut timeshare sales by 70%.
“You’ll probably put them out of business,” he said to Curtis.
Curtis responded by saying: “If any business is dependent upon getting people to do something they don’t want to do, then they perhaps should go out of business. Now, my goal is not to put them out of business, my goal is just to make it so people can trust what they’re getting into.”