Ask Dr. Don By Don Taylor, Ph.D., CFA • Bankrate.com

Time-share troubles

Dear Dr. Don,
I have a time share in Florida that we have never used. It was purchased in 2000. I was lied to about the taxes and the upkeep. I have use of the time share every other year. How bad would it hurt me if I let them foreclose on this property? I own my house in Texas and I do not foresee needing to borrow money within the next few years.
Randy Restitute

Dear Randy,
You need to hire a Florida real estate attorney to help you make this decision. I'm not an attorney and can't provide you with legal advice, but I can refer you to Florida Statutes F.S. 721.80 time share Lien Foreclosure Act to give you an idea of what you're up against. What's key are the legal remedies available to the lender and the association in collecting any deficiencies remaining after foreclosure.

Turning in your keys won't make the financial pain go away and will ruin your credit rating to boot. Your notion that you can outwait the negative information on your credit report to get out from under this obligation doesn't consider the lender's and the association's ability to pursue these claims in court.

As long as you're not judgment proof, meaning you have a high enough income and net worth that the lender is likely to collect when it wins a judgment against you, you're likely to take a financial hit for the lender's lost equity and legal fees. The association will seek to collect the outstanding maintenance income, property taxes and legal fees.

The attorney can also review the sales contract to see if you have a claim against the association for breach of contract, or for its sales practices in selling you the time share. This, however, is a bit of a long shot three years after the sale.

Filing complaints with the Better Business Bureau and the Federal Trade Commission may not provide any financial relief, but it could stop other consumers from believing a salesperson's pitch about taxes and maintenance.