Vacation club memberships function like a timeshare, but with more flexibility. Members pay an upfront fee and sometimes an annual maintenance fee to join the club. In return, they receive points or credits, which can be redeemed for stays at various properties or destinations affiliated with the vacation club. The points system allows members to choose when, where, and how long they vacation, offering a more tailored experience compared to traditional timeshares. The availability of locations and the value of points can vary based on the tier of membership and the specific terms of the club.
These membership schemes present an attractive appeal, offering multiple getaway destinations for you and your family throughout the year. What these membership programmes fail to inform you as the consumer, is that cancelling your membership can often include long, drawn-out processes with the consumer having to jump through many hoops before being disassociated with their vacation club.
Certain memberships go so far as to binding you as the owner of the time-share which includes the obligation to contribute to management fees as regulated by the Property Time Sharing Control Act.
Hidden costs associated with these businesses include:
- Annual maintenance fees;
- Exchange fees;
- Booking restrictions;
- Points expiration;
- Upgrade pressures;
- Travel costs;
- Interest on financing; and
- Special assessments for repairs to the properties.
In terms of the cancellation processes, each and every membership programme differ in their cancellation policies, however, the common trends for cancellation include:
- Cancellation fees;
- Hidden costs;
- Questionnaires;
- Management fees;
- Administration fees; and
- Cancellation may, at times, be only viable through an advanced notification of cancellation.
The process of cancelling is not as one would expect, and often these companies will draw out this process in order to continue to receive monthly debit payments from their members. Ultimately, should you choose to invest into these vacation club membership programmes, one must be careful to ensure that they are fully aware of all the hidden costs that are associated to these businesses. The most appropriate remedy for the consumer in these situations is to rely on Section 68 of the Consumer Protection Act 68 of 2008 which dictates that a supplier may not victimise a consumer by discriminating against them or penalising them should they wish to cancel. The cancellation charge may not have the effect of negating the consumer’s right to cancel.
Further to the above, Section 41 of the Consumer Protection Act states that a supplier may not misinform the consumer in terms of the conditions of the agreement. Should the consumer prove that they were misinformed when signing the contract, the contract will be void.
Vacation clubs can offer appealing flexibility and access to a wide range of travel destinations, but they also come with significant considerations that potential members must evaluate carefully. While the concept of accumulating points for luxurious stays is enticing, the reality often involves various hidden costs such as annual maintenance fees, exchange fees, and the risk of points expiring. Additionally, popular destinations might require more points, leading to unexpected expenses or the pressure to upgrade memberships. The long-term financial commitment is further complicated by potential resale difficulties, with memberships often losing value and being hard to sell. Furthermore, high-interest rates on financing, special assessments, and the cost of travel not covered by the points add to the overall expense. Cancellation policies are frequently stringent, making it difficult or costly to exit the arrangement, which can trap consumers in a contract that no longer meets their needs.
Should you have any questions or concerns relating to vacation clubs, whether it be prior to your commitment to becoming a member, or if you are desirous to cancel your membership and would like the assistance of the team that has achieved the best outcome for their clients, feel free to leave a comment or reply to the article below and we will be in contact with you.
If you would like to contact us directly:
Tel: 011 463 1214
Email: info@pagelinc.co.za