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Owners Timeshare News

Another Timeshare Exit Company Bites the Dust

Despite an endorsement from personal finance guru Dave Ramsey, it didn’t end well for Timeshare Exit Team and many owners who paid them thousands. Now it’s gone. Here’s our take on what the company’s downfall means for the industry.

Mike Kennedy - Mar 09, 2022

Timeshare Exit Team, armed with an endorsement from personal finance personality and radio host Dave Ramsey, lured in hundreds of timeshare owners who paid upfront fees of $3,000 up to $9,000 in the hopes of getting out of their contracts. In September 2021, the State of Washington ordered the company (officially known as Reid Hein & Associates LLC) to pay $2.61 million in restitution and discontinue its deceptive practices. Now, it appears the company has closed its doors, according to an article in Resort Trades Magazine penned by industry group ARDA.

ARDA, the timeshare developer association, called the closure “yet another example of unscrupulous third-party exit companies leaving consumers high and dry.” It is unclear how any of them will get back the money they’re owed.

While I have no personal experience with Timeshare Exit Team specifically, it’s undeniable that there is a preponderance of scams within the timeshare exit industry as a whole. Something had to be done urgently to protect consumers. But we must also take a stark look at the reason companies like Timeshare Exit Team exist in the first place. Why were they able to gain ground? How did they effectively own the narrative in the secondary market for nearly a decade?   

Brandon Reed, the CEO of Timeshare Exit Team, contends that they’re the good guys.  “Despite the timeshare industry’s efforts to try to turn the story around, painting exit companies as the villain, we’re not going to stop. It is time the timeshare industry looks at itself and changes for the better,” he said in a press release prior to the company’s closure. 

Wherever you sit on the matter, he’s right about one thing: The dialog between exit companies and timeshare developers is focused on vilifying the opposition and not on addressing the actual problems timeshare owners may be dealing with. In an industry where consumer confusion is common and consumer protections can be relatively weak (compared to say, getting a mortgage), scamming can, and has in this case, become a pervasive problem. We believe — and the data supports it — that timeshare developers would make even more money if current and future owners had more clearly defined ways to defray the costs of ownership (like rentals) or to find an off-ramp altogether when the time comes.

Many consumers turned to Timeshare Exit Team to help them end their vacation ownership contracts because of Ramsey’s strong and repeated endorsements, supplemented by the company’s alleged 100% money-back guarantee. 

According to an MSN report, one owner of a timeshare in Branson paid the company $11,000 in fees thanks in part to “their faith in Dave Ramsey’s glowing recommendation.” After two years of no action, the owner was told that the case was still being worked on and therefore did not qualify for a refund.  

It’s a shame that unscrupulous people will take advantage of vulnerable consumers who want out of a timeshare that they’re no longer enjoying. It’s even more of a shame that a personal finance “guru” like Ramsey will tell his millions of listeners to trust a company that he hasn’t fully researched — but that happens to advertise on his show. 

“I have had no direct insight into Reed Hein’s operations, representations to its customers, or any other aspects of its business,” Ramsey told the court in the Washington case. “Again, others on my team are responsible for the details of the endorsement relationship, and I act based on their recommendations and advice.”

Whatever your opinion of Ramsey or timeshares in general (and for the record, I’m a very happy timeshare owner myself, and believe that most owners are as well), we think that owners deserve better.

I cofounded KOALA to create an ethical and transparent way for owners to rent out the timeshares they can’t use. We feel that timeshare rentals are a fair and sustainable way for owners to defray costs such as annual maintenance fees, while giving vacationers access to enjoyable and affordable resort stays.

As I’ve written elsewhere, the timeshare industry desperately needs a stronger secondary market — a place where owners can responsibly sell or otherwise divest from their timeshares. The absence of clear and fair options is precisely what allows scammers to thrive.

If you’re not using your allocated weeks or points, consider renting them on KOALA. And if you really want to exit your timeshare completely, we strongly encourage you to visit ARDA’s ResponsibleExit.com website for advice on avoiding exit company scams and using developer “deedback” programs. Timeshare companies are becoming more amenable to the latter, reacquiring unwanted timeshares from owners; but to be fair, that doesn’t work for everyone. If there’s an open loan, for example, things can get a lot more complicated. That said, it’s always worth checking out those options first. The Timeshare Exit article in KOALA’s Owner Resources contains additional information.

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