Should I use a personal loan to buy or exit a timeshare?

Timeshare purchase: Timeshare developers offer in-house financing at 15%-20% APR. A personal loan would be a lower rate alternative for the purchase price ($10,000-$50,000). However, the fundamental problem is not the financing rate: timeshares lose 80%-95% of their value immediately after purchase. They are virtually impossible to resell at the original price (average resale price on the secondary market is $1-$2 for many timeshares). Annual maintenance fees ($800-$1,500+) escalate each year. The total cost of ownership over 10 years often exceeds the original purchase price again. Do not take a personal loan to buy a timeshare.

Timeshare exit: Legitimate timeshare exit companies charge $4,000-$12,000 to negotiate a deed-back or legal exit from the timeshare contract. Some consumers borrow to pay these fees. Significant warning: the timeshare exit industry has numerous scammers. Verify any exit company with the American Resort Development Association (ARDA), BBB, and your state attorney general's office before paying. Some exit companies take large fees upfront and do nothing. Report scams to the FTC.

Lower-cost exit alternatives: Deed-back programs: some major timeshare companies (Wyndham, Marriott, Hilton) have in-house exit programs that are free or low-cost for owners current on maintenance fees. Contact the resort directly before hiring an exit company. Rent the timeshare: listing on Redweek or VRBO to offset maintenance fees is not an exit, but reduces the annual carrying cost while you pursue other options.