Silverleaf Timeshare! ugh!!! Help!?

Question

So my husband and I were some how scammed into purchasing one of these timeshares from Silverleaf. It sounded like a great deal, but come to find out after we had already signed the paperwork that they had told us a bunch of lies.

Lies:

1. We could use the Piney Shores resort anytime.

2. We could use Bonus Time anytime, doesn't matter that we had purchased a blue/white week. We could use the resort even during the red season. Sun-Thurs would be free, and Friday and Saturday would be $50.

These are the reasons we purchased. Piney Shores is right off of Lake Conroe, and we love being out on the boat, we thought it would be super fun to be able to gather friends and go out whenever. Later we find out that we can't stay during the red season, which is the only freaking time we would want to take the boat out. Sure we can go out for the day, but we can't stay there.

If we just quit paying on the timeshare what is the worst that could happen? Will it hurt our credit that bad?

Answer 1

That is terrible not only once but twice they scammed you.

The sad part is that it seems to be happening everywhere and no one does anything about it just take a look at this stories:

http://timeshareownerscommunity.com/indu...

But before anything you should check in to your rescission period clause.  In some resorts you are still able to cancel as long as you have not used the unit.

If you just stop paying for the loan this might happen:

1. The foreclosure will be visible on your credit history. Lenders will take it into consideration that you didn't pay a debt before loaning you additional money. You will either not get the new loan or will pay a much higher interest rate.

2. The timeshare lender will report the foreclosure to the IRS. They will show the amount of money that was still owed at the time of the foreclosure as well as the value of the property at the time it was sold.

Let's say you paid $10,000 for the timeshare, had a remaining balance of $8000 and the timeshare is now wroth $4000. For tax purposes you have a $4000 non-deductible loss (timeshares are personal use property) and a $4000 cancellation of debt income. If you are not insolvent or bankrupt, the $4000 will be added to your income in the year of the foreclosure as 'other income.' (The loan is considered separately from the property so the $4000 loss doesn't reduce the COD income at all.)