North Carolina Real Estate Laws & Rules Governing Timeshares

Instructor: Kyle Aken

Kyle is a journalist and marketer that has taught writing to a number of different children and adults after graduating from college with a degree in Journalism. He has a passion for not just the written word, but for finding the universal truths of the world.

Brokers in North Carolina must understand the rules of the North Carolina Time Share Act, the powers of the Real Estate Commission, and Timeshare Sales Operation Rules. This lesson attempts to simplify the Time Share Act.

Laws and Rules Governing Timeshares

In North Carolina, many people are motivated to spend money for a slice of paradise. There are many condominiums sold as resort timeshares. With sales increasing for timeshares, the industry has grown, and now there are many types of timeshares options.

However, some dishonest people have questionable sales practices when it comes to timeshares. To top that off, the real estate rules and laws governing timeshares can be complicated. This lesson attempts to simplify the rules and regulations regarding the Time Share Act in North Carolina.

Timeshares Deemed Real Estate

Real Estate Law 93A-42 states that a timeshare regarding real property in North Carolina is governed by its laws relating to real estate. Timeshare registration is done to obtain protection provided by the general statutes for recording other types of real property instruments.

The developer must record a timeshare instrument and deposit any money in a trust or escrow account within a bank or other financial institution in the state. If the purchaser is in default, the developer is not required to record the timeshare instrument. In fact, when a timeshare is recorded, it means that the delivery of the instrument from the developer to purchaser is complete.

North Carolina Time Share Act

The North Carolina Time Share Act has the following sections:

  1. Public Offering Statement: All developers will disclose in a public offering statement the financial obligation, the terms and conditions, nature and duration of agreement, availability, and right to cancel; it even has to be recorded.
  2. Purchaser's Right to Cancel: The purchaser has the right to cancel within five days, by mail or hand delivery. All payments for a timeshare will be put in a trust or escrow account and remain there for 10 days or cancellation by the purchaser. Finally, the developer must provide the purchaser with the statement required by the Time Share Act or be subject to penalties for violation.

Disciplinary Actions by Real Estate Commission

The North Carolina Real Estate Commission has the authority to adopt regulations and rules that are consistent with the provision of the North Carolina Time Share Act and General Statute of the state. The commission can take disciplinary action on its own or on a verified complaint of any person.

If the commission finds that a developer, timeshare salesperson, or project broker has violated any of the terms in the Time Share Act, it can hold a hearing. In fact, the commission has the power to revoke or suspend a real estate license issued to a project broker or timeshare salesperson. It can even censure and reprimand someone for many reasons, from negligent misrepresentation to paying a commission to an unlicensed person.

Someone in violation of any of the Time Share Act's terms can be found guilty of a Class 1 misdemeanor. Furthermore, every developer must designate a natural person to act as the Time Share registrar for all of its projects. The registrar is responsible for recording all timeshare instruments and releasing any liens. If a registrar knowingly or recklessly fails to record a timeshare, he is guilty of a Class 1 felony.

Timeshare Sales Operation Rules

According to the North Carolina Real Estate Commission rules, there are many sections that a timeshare developer, purchaser, or other licensee will need to know. This includes:

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