Was Timeshare Exit Team Deceptive?
First, the genesis of (and culpability for) the timeshare exit industry is a complicated one and my thoughts have been documented. Like many of these exit companies, Timeshare Exit Team (officially known as Reid Hein & Associates LLC) promised to help timeshare owners exit their contracts. According to them, they were successful at many of those. While we can neither confirm nor deny those claims, that early brand recognition attracted hundreds of timeshare owners who paid upfront fees of $3,000 to $9,000, hoping to be free of their contracts. When armed with an endorsement from Dave Ramsey, that demand for Timeshare Exit Team’s services exploded. That growth continued until September 2021, when the State of Washington ordered the company to pay $2.61 million in restitution. The company has since closed its doors.
The company’s CEO, Brandon Reed, claimed they were the “good guys,” but many consumers who paid hefty fees (based on Ramsey’s strong endorsements) claim to have found themselves in a worse situation than before. One owner of a timeshare paid the company $11,000 in fees, partly due to their faith in Dave Ramsey’s endorsement. After two years of no results, the owner was told that their case was still being worked on and therefore did not qualify for a refund?. These already distressed timeshare owners ostensibly found themselves out of the proverbial frying pan and into the fire.
Dave Ramsey’s Role and the Lawsuit
Ramsey, a popular radio host known for his financial advice, is now facing a $150 million lawsuit from 17 ardent listeners who claim he played a role in defrauding them by promoting Timeshare Exit Team. The lawsuit, filed in April against Ramsey and marketing company Happy Hour Media Group, alleges that Ramsey was paid millions to advertise Timeshare Exit Team. Lawyers say Ramsey was paid $450,000 a month by Reed Hein for his services, amounting to $30 million in total.
Ramsey promoted Reed Hein between 2015 and 2021, and during that time, it’s claimed he received thousands of letters from listeners who were unhappy with the company’s services. In total, Reed Hein received $70 million in fees from customers referred to it by Ramsey. Each of the 17 plaintiffs in the lawsuit claim that they paid thousands for Timeshare Exit Team’s services after listening to Ramsey’s promotions. They report being advised to negotiate their own settlements with their timeshare companies, and often found it difficult to contact Reed Hein.
The Path Forward
The downfall of Timeshare Exit Team and the associated lawsuit against Dave Ramsey is a cautionary tale for consumers and advocates alike. As the timeshare industry continues to evolve, it is imperative that owners have access to clear and fair options for divesting from their timeshares. This case serves as a stark reminder that a stronger secondary market is desperately needed in the timeshare industry to prevent such scenarios from recurring. Platforms like KOALA offer a transparent and ethical way for timeshare owners to rent out their timeshares. It presents sustainable ways for owners to offset costs (such as annual maintenance fees) and give vacationers access to enjoyable and affordable resort stays. This is a win-win-WIN for owners, vacationers as well as the timeshare companies. I’m confident timeshare companies would prefer to evade attention that perpetuates the unfortunate (and very often inaccurate or incomplete) stereotypes about the word “timeshare” – as this case so vehemently does.
Disclaimer: This article represents the facts around the recent Class Action lawsuit involving Dave Ramsey, Timeshare Exit Team and its plaintiffs (Patrick vs. Ramsey) as I understand them and do not reflect any opinions of myself or that of KOALA or its affiliates or nor does it reflect any biases towards the timeshare industry, Dave Ramsey, Timeshare Exit Team or any other affiliated party as it relates to this ongoing case.