Can Timeshares Affect Your Credit?

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Neglected timeshare ownership may hurt your credit score. Few timeshare owners know of this fact when they buy a timeshare. The sales presentation does not necessarily talk about what may happen if you miss your timeshare payments. 


In this article, we will talk about your vacation property’s possible impact on your financial health.  

Table of Contents

How to Legally Cancel a Timeshare Contract?

New timeshare owners have a few days to cancel their contract. In this period, they can communicate with the resort company to let them know the intent to cancel. Ideally, this should be done before the rescission period. The timeshare owner may effectively end the agreement within this period without fearing financial or legal penalties. 


They have to act within this period if they regret their purchase. By communicating with the resort immediately, timeshare owners will avoid the financial burden of paying mortgage and maintenance fees.

What If I am No Longer in the Rescission Period?

Most of you reading this article may no longer be in the rescission period. In that case, you may have to find an alternative way to exit your timeshare ownership. If you just abandon your contract, the timeshare resort may take some steps that may impact your credit score. 


Why does this matter? Many people feel frustrated when trying to exit their timeshare ownership. Some take steps that may hurt their credit scores. An example would be to stop paying their timeshare fees altogether. Experts warn against doing this. Stopping your payments may lead to the resort foreclosing on the property. If they are successful, this may hurt your own financial health. 

Do Timeshares Report to the Credit Bureaus?

After the foreclosure process, the resort developer may report the results to the credit bureaus. Your credit score will take a hit if this happens. For this reason, timeshare exit experts recommend for owners to keep paying their fees even if they are trying to exit. Here at Forza, we recommend that you use legal ways to get rid of this financial commitment. That is if you care about your credit score.

Inherited Timeshares: Even people who did not sign up for the timeshare contract may end up having this problem. Because of the perpetuity clause included in many contracts, the financial burden of one person may be passed onto their heirs upon death. You might end up owning a timeshare even if you didn’t opt-in. Learn more about the details of inheriting a timeshare here.

Some of our clients didn’t even buy the timeshares. Some of them only inherited it from their parents, or they may have cosigned with a friend during the purchase. Even if this is the case, you may still be obligated to pay the timeshare fees when the original owner passes away.

Does Timeshare Debt Hurt my Credit?

Your credit score will take a hit after a period of non-payment of the loan or of the maintenance fees.

Just as you may have homeowner membership dues, special assessments, taxes, and services on your home, you may have the same type of responsibilities for your timeshare. If, for any reason, you can no longer handle the payment, or you become faulty on your dues, taxes, and fees, the timeshare organization can put a charge on your ownership share of the property. 

The resort may decide to foreclose on the timeshare property and report the results of the foreclosure process to credit bureaus. This can damage your credit score and harm your ability to sell your timeshare.

How can Timeshare Neglect Lead to Foreclosure?

The high price of timeshares often requires buyers to take a loan from financing companies. Most of the time, this type of loan is classified as a mortgage. In effect, if you miss paying your mortgage obligations, you may get a mortgage foreclosure on your record. 

Most companies that finance timeshares notify your payment history to credit bureaus if you fall behind on the repayment of your loan or delay in maintenance fees, which can severely affect your credit score.

If the finance company gets a final judgment, it can take many steps to obtain your paycheck or they might go after your assets. In fact, they might release a lien against your residential property. 


Trust us on this; timeshares can ruin your credit. Judgments and foreclosures stay on your credit report for as long as seven years. Late payments of your installments on your timeshare has the same effect as late mortgage payments. Poor credit can hinder you from buying a home or even purchasing a car or any valuable items.

The Burden Can Be Passed to Your Children

When the timeshare owner passes, their ownership is usually passed on to their heirs. Read your contract to determine who will inherit your timeshare ownership after you pass. In most cases, owners add their children as their heirs as recommended by the timeshare salespeople. As a result, the burden of paying the mortgage and the maintenance fees is also passed on. 


Foreclosure may happen when your children fail to pay the obligations that come with the timeshare ownership. If you want to prepare for this eventuality, you can read our guide for inheriting a timeshare. 

How Can I Get Rid Of My Timeshare Without Damaging My Credit?

1. Pay your timeshare bills on time

The best strategy to avoid damaging your credit score is by paying your financial obligations on time, as stated in your contract. Even if you plan to exit your contract, do not miss out on your payments. 

2. Avoid exit companies that tell you to stop paying your obligations

You may choose to hire a company to help you exit your contract. Some less reputable companies may give questionable advice to stop paying your timeshare mortgage or maintenance fees. This may push the resort companies to report your payment delinquencies to credit bureaus. 

3. Exit Your Timeshare Properly Before the Resort Starts the Foreclosure Process

Your credit score will only take a hit if you miss payments and the resort starts to foreclose on the property. By paying your timeshare dues on time, you prevent this from happening. However, you cannot keep paying your timeshare fees forever, especially if you cannot use your timeshare because of the travel restrictions. If you want to end your timeshare contract, you want to act now before the financial burden takes a tremendous toll on your finances. 


You may call Forza today to discuss the different options available to exit your timeshare. 

4. Keep Your Other Financial Obligations Current

Some of you may already have your credit score damaged by your timeshare ownership. In that case, you can prevent further damage by remaining current on the other types of debt you may have. This will help in repairing your credit score. 

5. Communicate with the resort

Some resorts will consider your situation and offer solutions that may allow you to sell your timeshare ownership. If you have diligently paid your timeshare fees, ending your timeshare ownership this way may keep your credit score untouched.


Contact your resort’s loyalty team as soon as possible to know of the solutions they may offer. Make it clear to the resort that you only want to exit your contract without hurting your credit score. If the solutions they offer do not seem fair, Forza is here for you:

6. Find a Legitimate Timeshare Exit Team to Facilitate a Graceful Exit from Your Contract

You may avoid hurting your credit score by exiting your contract correctly. You can do this yourself, or if you are not familiar with the timeshare exit process, you could hire professionals to handle the process for you like Forza. 


Here at Forza, we have helped countless timeshare owners cancel and exit their contracts. The strategies we employ are crafted according to the unique details of your contract. We do not use tactics that put your credit score at risk. 

If you need help in exiting your timeshare contract, give us a call at 877-822-5840. 

Or you could fill out and submit the form below to schedule a call. 


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