Real Estate Brokerage & Timeshare Listings & Offers in Tennessee

Instructor: Eileen Cappelloni

Eileen worked for the Orange County Asssociation of Realtors for 31 years. She has written real estate courses and exams for other publishing companies

This lesson will define and describe how real estate licensees handle timeshares in Tennessee. You will also learn about the laws governing listings, offers, and special rules about timeshare properties.

What is a Timeshare?

George and Betty retired recently. They had taken cruise vacations, visited different countries, and became interested in learning more about buying a timeshare, where you could either vacation in the same place every year or exchange the time you are given and use it for a different property located somewhere else. It seemed to operate so very differently than buying a vacation home or taking a cruise so George and Betty spent a long time researching the possibilities. A patient sales agent, Sarah, explained to them how a timeshare differs from other types of purchases and vacations.

Sarah explained that when you purchase a timeshare, you or your family own a vacation unit either for the rest of your lives or until you sell it. Your interest is legally considered real property. You buy the right to use a specific unit at a specific time every year, and generally, you may rent it, sell it, exchange it, and even leave it to your beneficiaries. You and the rest of the owners of the same timeshare development own a specific unit.

What are Your Responsibilities?

No matter how you've paid for it, you will be responsible for either paying a monthly mortgage and a maintenance fee, or if you've paid cash for the timeshare, you are still responsible for paying the maintenance fee plus property taxes if they're not already included in the maintenance fee. All timeshare owners share in the use and upkeep of the individual units and the common grounds of the property. There is usually a homeowners' association that typically handles management of the resort and day-to-day operations. The timeshare owners elect a Board of Directors, who determines the maintenance fees and selects a management company.

Timeshare Ownership

George and Betty decided to purchase a timeshare in 2018 and they are thoroughly enjoying their purchase. They have brought their grandchildren to their timeshare to visit and they have traveled to places they would never have been able to afford otherwise.

Timeshare Regulations

George and Betty extensively researched their purchase prior to buying. But not everyone does. The State of Tennessee ensures that consumers who might be interested in buying a timeshare are protected by state regulations. The state oversees timeshare advertising and policies and discourages timeshare developers and salespeople from attempting to conduct scams or using unscrupulous sale tactics.

Canceling a Timeshare Purchase in Tennessee

Tennessee timeshare law states that either the purchaser or the seller may cancel a timeshare contract if it's done timely. The right of rescission for the purchaser is up to 15 days if the purchaser has not actually seen the property prior to executing the contract, and if they have already seen it, they are still entitled to a 10 day-cancellation period.

Tennessee Timeshare Advertising Protection

The advertising rules also states that there shall be no verbal promises of resale guarantees or rental programs unless it is stated so in writing in the contract. Also, there may not be any false statements made of how a purchaser can use the exchange program.

It is also unlawful to represent any predictions of an increase in value or price of ownership.

Becoming Licensed to Sell Timeshares

Betty starts telling others about her and her husband's satisfaction with the timeshare they purchased and decided she wants to spread her enthusiasm by selling them.

Betty learns that Tennessee requires 30 hours of classroom training prior to taking the Timeshare Salesperson test. This does not allow her to sell any other type of real estate but she needs to pass this in order to become a licensed timeshare salesperson.

The Tennessee Real Estate Commission governs timeshare salesperson licensing; a timeshare salesperson must be affiliated with a licensed real estate firm that is associated with a registered timeshare development. A license is required to be issued by the Tennessee Real Estate Commission to engage in timeshare salesperson activities.

Betty learns the rest of the qualifications that she will need. She must:

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