Seller's costs include several different fees essential for the transfer of timeshare ownership. Let's take a closer look at some of the typical fees associated with most timeshare closings. Although not every fee mentioned may apply in every case, this overview will assist most sellers in grasping the purpose of each fee.
The term "title search" refers to the process of reviewing public records to verify and establish the legal ownership of a property. This process involves examining various sources such as deeds, tax liens, land records, and court judgments. Typically performed by title companies, individuals and businesses can request these searches at any time to identify any claims or liens associated with the property. A clear title is essential for completing any real estate transaction; if a title search reveals a lien, the transaction cannot proceed. We provide a comprehensive range of commercial title services, including title searches, title insurance, and property reports. Our expert team ensures that the title is free of issues before you buy or sell your commercial property.
The buyer can elect to purchase title insurance when buying timeshares on the resale market. This is an optional fee that will cover any title defects, liens or encumbrances that may not have been previously discovered throughout the closing process.
This is a developer-imposed fee that is charged for the transfer of the timeshare to the name of the buyer. The transfer fees that each resort developer charges can vary dramatically depending on the timeshare you are transferring. Be sure to consult with a trusted broker to understand what portion of your seller's costs are allotted to satisfy the developer’s transfer costs.
Some resorts may charge a fee for an estoppel or status letter, which is essentially a document that confirms the attributes of the ownership and its financial status, whether that be verifying the annual maintenance fee, or any outstanding loan balances that may be present.
The estoppel will show any outstanding balances or assessments associated with the timeshare and your closing company will compare what is shown in the estoppel letter to what you are contracted to buy or sell. In this way, an estoppel is an important step in ensuring that the buyer is receiving the exact timeshare they were contracted to receive, as well as ensuring the seller has paid all outstanding maintenance fees leading up to the closing process.
Depending on which brand of timeshare is being sold, fees associated with the developer’s right of first refusal process may need to be included. Some developers have a clause in the original agreement that the seller signed which grants them the chance to purchase the timeshare directly from the seller prior to the seller being able to transfer the timeshare on the secondary market. In order to waive their right, to allow the buyer to comfortably enter into a binding resale committment, this step must be completed.
The term recording fee refers to an expense a government agency charges for registering or recording the purchase or sale of a piece of real estate. The transaction is recorded so it becomes a matter of public record. Recording fees are generally charged by the county where the transaction occurs since it maintains records of all property purchases and sales. The amount of the recording fee varies from county to county.
Transfer taxes are levied by state, county, and occasionally city governments. While they are prevalent, they are not found everywhere; some regions do not impose any transfer taxes. The rates differ significantly across the United States. Typically, the seller is responsible for these taxes, which are calculated as a percentage of the sale proceeds. These taxes must be settled before a timeshare can be transferred from one owner to another. Both state and county transfer taxes exist, with rates ranging from 1.19% to 3.22% of the sale proceeds.
Certain sellers with unused time might notice an RMN fee reflected in their estimated net proceeds statement. This fee, which amounts to 20%, applies to any unused weeks or points being sold alongside the timeshare. It operates separately from the sale itself, and if any eligible unused time is not sold, it will be returned to the resort once the transfer process starts. Since this time has already been paid for through maintenance fees to the resort, many owners feel compelled to recover their investment by selling.
The use of a third-party closing company is an incredibly important step in successfully and safely transferring timeshares. A closing company is empowered to be an impartial agent that will protect both the buyer’s funds as well as the seller’s property, ensure the transaction is performed in accordance with the signed purchase agreement, and will be the central contact for developers, local governments, brokers, agents, and both buyer and seller throughout the sale.
To get the most accurate estimate on your timeshare resale closing services, it’s best to reach out to a dependable and trustworthy broker about a particular listing that piques your interest. These costs can vary greatly on the specific services you need, the resort / property you are interested in selling, which state the property is located within, among many other factors.
The process to transfer and ultimately close on a timeshare sale can vary greatly depending on the particular timeshare you wish to buy or sell. Generally, many transfers can be completed in about 30 – 60 days, but you will want to speak to a knowledgeable broker to get the most accurate estimate for your situation.
As outlined in the agreement, your offer is contingent upon your acquisition and submission of the required ownership verification forms, along with preliminary transfer approval from both the resort and the condominium association, all to be completed within ten calendar days. There are costs linked to each transfer requirement. Access to funds is essential to cover the costs associated with these procedures, along with all required documentation as each condition is fulfilled. Consequently, since the initial steps must be completed within ten days of accepting the offer, we kindly ask the seller to transfer the funds within 24 hours of signing the offer documents. To reduce long hold times and avoid potential delays or reviews, we do not accept personal checks or credit card payments. Instead, we request that you initiate a bank wire transfer from your financial institution, which enables us to promptly verify the availability of funds and mitigate any risk of payment defaults.
Upon receiving notification of your wire transfer, we will inform the buyer’s agent about the commencement of the transfer process. We will request an updated title abstract, submit the required transfer applications, seek approval for the perpetuity release, and collect any additional documents outlined in the contract. After fulfilling these requirements, we will send the documents to the Buyer’s agent and propose a closing date.
Any violation will be deemed a significant breach of the resale agreement, resulting in its permanent nullification, irrespective of the phase at which services are rendered. All parties recognize that, in accordance with applicable state and federal laws, if confidentiality is breached and the sale is canceled, any payments made up to that moment will be forfeited and non-recoverable. In these situations, it is highly recommended to consult with legal counsel.
As our team meets each requirement from the resort, association, county recording clerk, etc., we will draw funds from the escrow account to cover the appropriate fees and documentation.
1. Verification of ownership by title search
2. Request the resort to waive the right of first refusal
3. Request an Estoppel Certificate from the resort to verify that the account is in good standing
4. Submit the application for the resort to approve ownership transfer
5. Submit the application for the condo association to approve the transfer of maintenance fees and tax obligation.
To illustrate, our first set of requirements requires five important steps to be completed within ten days of offer acceptance. There are associated fees for each of these requirements. For example, two transfer applications need to be submitted because maintenance fees do not automatically carry over with the transfer of the deed or membership. Both the condo association and the resort impose separate application fees for this approval process, in addition to a fee that is charged once the applications receive formal approval.
We need access to funds to cover the costs related to these steps, along with all necessary documentation as each requirement is fulfilled. Contacting each client to request funds every time a fee arises would be an inefficient use of time. Consequently, since the initial steps outlined must be completed within ten days of offer acceptance, we require the seller to transfer funds within 24 hours of signing the offer documents.
To avoid long hold times and potential delays or reviews, we do not accept personal checks or credit card payments. Instead, we ask that you initiate a bank wire transfer from your financial institution, which enables us to quickly verify the availability of funds and prevent any payment defaults.
Your funds should be sent through a Fedwire initiated from your bank or mailed in the form of a cashier's check, issued by a Florida institution, made payable to the escrow agent in the amount requested. A personal check may delay the closing or may be unacceptable to the title or escrow company. An out-of-state check could also cause a delay in your closing due to possible delays in clearing the check. The preferred form of payment is a domestic or international wire transfer from the seller's chosen bank directly into the escrow agents account.
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