Estate Planning and Timeshares: What Your Attorney Won’t Tell You

You have done the responsible thing. You have met with an estate planning attorney, created a will or trust, designated beneficiaries, and organized your financial life so that your loved ones will be taken care of when the time comes. But there is a good chance that one significant asset — or more accurately, one significant liability — has been completely overlooked in this process: your timeshare.

Most estate planning attorneys do not spend much time on timeshares, and there are some important reasons why. Understanding those reasons, and understanding what your attorney may not be telling you, can save your family from a complicated and costly situation down the road.

Why Most Estate Attorneys Do Not Address Timeshares

Estate planning attorneys are skilled professionals who deal with wills, trusts, tax planning, and asset distribution. But timeshares occupy an unusual space in the legal landscape that most attorneys are not specifically trained to handle. Here is why timeshares tend to fall through the cracks:

Timeshares Are Not Traditional Assets

Most assets in an estate either have clear value (a house, investment accounts, life insurance) or are straightforward to handle (personal property, vehicles). Timeshares are different. They are treated as real property interests, but they often have little or no resale value. They come with perpetual financial obligations. And they are governed by complex contracts that vary significantly from resort to resort.

An estate attorney who is accustomed to working with houses, stocks, and bank accounts may not be equipped to evaluate the unique challenges a timeshare presents. As a result, the timeshare may simply be listed as an asset in the estate plan without any specific strategy for handling it.

The Liability Is Not Always Obvious

When an attorney reviews your assets, they typically focus on value: what is this worth, and how should it be distributed? A timeshare might appear on the books as an asset worth whatever you paid for it — say, $20,000 or $30,000. What does not always show up is the ongoing liability: the maintenance fees that increase every year, the special assessments, and the perpetual nature of the obligation.

An estate plan that treats a timeshare as a $20,000 asset without acknowledging the $1,500-per-year (and growing) maintenance fee obligation is not giving your heirs the full picture.

It Is Outside Their Area of Focus

Estate attorneys specialize in estate law, not timeshare law. These are distinct areas of practice. A general estate attorney may not be familiar with resort surrender programs, timeshare exit strategies, perpetuity clause challenges, or the specific laws governing timeshare transfers in various states. Rather than give advice on a topic outside their expertise, many attorneys simply include the timeshare in the general estate plan and move on.

How Timeshares Complicate Your Estate

A timeshare in your estate can create complications that ripple through the entire settlement process. Here are the most common issues:

Probate Delays

If your timeshare is in a different state than where you live, it may require a separate probate proceeding in that state, known as ancillary probate. This adds time, cost, and complexity to the estate settlement process. For example, if you live in Illinois but own a timeshare in Florida, your executor may need to open a probate case in both states.

Ongoing Costs During Settlement

Estates can take months or even years to settle, particularly if they are complex or contested. During this entire period, timeshare maintenance fees continue to accrue. These costs come out of the estate, reducing the inheritance available to your beneficiaries. If the estate does not have sufficient liquid assets to cover these fees, the executor may be forced to use personal funds or allow the fees to go delinquent, which creates additional problems.

Family Disputes

Few things create family conflict like unwanted financial obligations. If your will leaves the timeshare to one child, that child may resent receiving what they perceive as a burden rather than an inheritance. If it is left to all children equally, they must agree on what to do with it — use it, sell it, or exit it — and reaching consensus among siblings on financial matters is not always easy.

Difficulty Settling the Estate

An executor cannot fully settle an estate and close the probate case until all assets have been properly distributed or disposed of. If no heir wants the timeshare and it cannot be easily sold or surrendered, it can hold up the entire estate settlement process, preventing your beneficiaries from receiving their other inheritances.

The True Cost of Ignoring a Timeshare in Your Estate Plan

Consider a concrete scenario. You own a timeshare with an annual maintenance fee of $1,400. You pass away, and your estate takes 14 months to settle. During that time, the estate must pay approximately $1,633 in maintenance fees (assuming the fee increased during that period). Your heirs then inherit the timeshare but do not want it.

They spend the next six months trying to figure out their options, during which another year of maintenance fees comes due — now $1,470. They eventually engage a professional exit service, which takes another 6 to 12 months and costs a fee. All told, the timeshare may have cost your estate and your heirs $5,000 to $10,000 or more in maintenance fees and exit costs, plus countless hours of stress and frustration.

Now contrast that with a scenario where you address the timeshare proactively during your lifetime. You exit the timeshare before your passing, and the obligation simply does not exist in your estate. No fees, no delays, no family disputes, and no complications.

Strategies for Handling Timeshares in Your Estate

Depending on your situation, one of these strategies may be appropriate:

Strategy 1: Exit Before It Becomes an Estate Issue

This is the cleanest and most effective approach. If you no longer use or want your timeshare, exit it while you are alive and able to manage the process. This might involve using a resort surrender program, selling on the secondary market, or working with a legitimate exit company. Once the timeshare is out of your name, it is out of your estate.

Strategy 2: Create Specific Provisions in Your Estate Plan

If you are keeping the timeshare for now, make sure your estate plan addresses it specifically rather than lumping it in with "all other property." Consider including:

• A specific bequest that identifies who should receive the timeshare (ideally someone who actually wants it)
• Clear language giving your executor the authority to surrender, sell, or otherwise dispose of the timeshare if no beneficiary wants it
• A designated fund within the estate to cover maintenance fees and exit costs during the settlement period
• Instructions for your executor about resort contact information, account numbers, and the location of your contract documents

Strategy 3: Use a Trust With Care

Placing a timeshare in a revocable living trust can help avoid probate, including the ancillary probate issue if the timeshare is in a different state. However, the trust does not eliminate the underlying obligation. The trust beneficiaries still inherit the timeshare and its costs.

If you do use a trust, make sure the trust document includes clear provisions for how the timeshare should be handled, and ensure the trustee has the authority to exit the timeshare if appropriate.

Strategy 4: Have the Conversation Now

Talk to your family about the timeshare. Find out whether anyone wants it. If someone does, great — you can plan for a smooth transition. If no one wants it, that information empowers you to take action now rather than leaving the problem for later.

When to Exit vs. When to Include in Your Estate

The decision between exiting now and including the timeshare in your estate plan depends on several factors:

Exit now if:

• You no longer use the timeshare
• No family member has expressed interest in taking it over
• The maintenance fees are a financial burden
• The timeshare has a perpetuity clause
• You want to simplify your estate and reduce potential complications

Include in your estate if:

• You still actively enjoy using the timeshare
• A specific family member genuinely wants to inherit it and understands the costs
• The timeshare is a right-to-use contract that will expire relatively soon
• You are in a financial position to set aside funds for the transition period

Working With Specialists

Because timeshares sit at the intersection of real estate law, contract law, and estate planning, handling them properly often requires more than one type of professional. Here is when to bring in specialized help:

• A timeshare attorney can review your contract, explain your rights and obligations, and advise on exit strategies specific to your resort and state.
• An estate planning attorney can incorporate timeshare-specific provisions into your will or trust, ensuring your executor has the tools they need.
• A legitimate timeshare exit company can handle the practical process of negotiating with the resort and completing the exit, freeing you from having to manage it yourself.
• A financial advisor can help you evaluate the long-term costs of keeping the timeshare versus the one-time cost of exiting, and factor this into your broader financial plan.

The Conversation Your Estate Attorney Should Be Having With You

If you own a timeshare and are working on your estate plan, here are the questions you should ask your attorney — even if they do not bring them up first:

1. How will the timeshare be treated in my estate?
2. Does my executor have the authority to dispose of it?
3. What happens if none of my beneficiaries want it?
4. Will my timeshare require ancillary probate in another state?
5. Should I exit the timeshare now to simplify my estate?
6. Are there funds set aside to cover maintenance fees during estate settlement?

Your attorney may not have all the answers, and that is okay. The important thing is that the questions are being asked. From there, you can seek out the specialized guidance you need to make sure your timeshare does not become your family's problem.

Estate planning is an act of love. It is about taking care of the people you will leave behind. Making sure your timeshare is properly addressed is simply part of that care.