How to Handle Timeshares in Your Estate Plan (and Why It Matters)
Timeshares are one of the most commonly overlooked assets in estate planning and one of the most problematic for families after someone passes away.
Many people assume a timeshare is just another piece of property. In reality, it can create ongoing financial obligations and complications if it’s not properly addressed in your estate planning documents.
If you own a timeshare in Maryland or elsewhere, it’s important to have a clear plan for how it will be handled.
Why Timeshares Are Different
Unlike most assets, timeshares often come with:
Annual maintenance fees
Special assessments
Limited resale value
Restrictions on transfer
In many cases, beneficiaries don’t want the timeshare—but may end up inheriting it anyway.
Not All Timeshares Are the Same
Timeshares generally fall into two categories: deeded timeshares and right-to-use (contractual) timeshares.
A deeded timeshare is an ownership interest in real estate. This type of timeshare can typically be transferred by deed, included in a will or trust, and may be subject to probate if not properly planned for.
A right-to-use timeshare, on the other hand, is based on a contract. It gives you the right to use the property for a set period of time, but you do not own the underlying real estate. These arrangements are governed by the terms of the contract, which may limit transfer or even terminate the interest at death.
Because the rules are different, it is important to determine which type of timeshare you own before deciding how to address it in your estate plan.
What Happens If You Don’t Plan for It?
If your estate plan does not specifically address your timeshare, it may pass to your beneficiaries as part of your general estate or become entangled in contractual restrictions that create confusion.
This can lead to:
Heirs being responsible for ongoing fees
Disputes among family members about what to do with it
Difficulty selling or transferring the interest
Continued financial obligations tied to an unwanted asset
In some cases, beneficiaries may need to take additional legal steps just to avoid being burdened by the property.
Can Beneficiaries Refuse a Timeshare?
Yes, beneficiaries can disclaim (refuse) an inheritance, including a timeshare.
However:
The disclaimer must follow strict legal requirements
It must be done within a specific time frame
The asset will then pass to the next designated beneficiary
If multiple beneficiaries disclaim, the outcome can become complicated.
Planning ahead is far easier than relying on disclaimers after the fact.
How to Address a Timeshare in Your Estate Plan
A well-drafted estate plan can prevent confusion and protect your beneficiaries.
1. Be Specific in Your Documents
Instead of leaving everything “equally,” you can:
Specifically address the timeshare in your will or trust
Name a beneficiary who actually wants it
Provide instructions for sale or disposal
Clarity is key.
2. Use a Trust Carefully
If you have a revocable living trust, a deeded timeshare can be transferred into the trust, but that does not eliminate the underlying obligations.
You should consider:
Whether the trust should retain or dispose of the timeshare
Who will be responsible for fees
Whether the trustee has authority to sell or terminate the interest
For contractual timeshares, transfer into a trust may not be possible or may be restricted by the agreement. In those cases, the trust should include clear instructions for how the interest should be handled.
3. Give Your Fiduciary Clear Authority
Your personal representative or trustee should have explicit authority to:
Sell the timeshare
Transfer it
Negotiate with the timeshare company
Decline or abandon the interest if appropriate
Without this authority, your fiduciary may be limited in what they can do especially with contractual timeshares that require cooperation from the issuing company.
4. Consider Lifetime Planning
In many cases, the best option is to address the timeshare during your lifetime.
This might include:
Attempting to sell or exit the timeshare
Transferring it to someone who actually wants it
Working with the timeshare company on surrender or termination options
Even if these options are limited, addressing the issue early can reduce the burden on your family later.
Common Mistake: Treating a Timeshare Like Any Other Asset
One of the biggest mistakes is assuming a timeshare will be a benefit to your heirs.
In reality, it is often:
A liability rather than an asset
Difficult to sell
An ongoing financial obligation
This is especially true for contractual timeshares, where the terms of the agreement may restrict transfer or continue obligations regardless of whether the beneficiary wants the interest.
What About Timeshares in Other States?
Many timeshares are located outside of Maryland.
This can create additional complications, including:
Ancillary probate proceedings (for deeded interests)
Different state laws governing transfer
Additional administrative steps
Proper planning can help streamline this process and reduce delays.
Final Thoughts
Timeshares require thoughtful planning.
Without clear instructions, and without understanding the type of timeshare you own, they can create confusion, conflict, and ongoing financial obligations for your loved ones.
With the right estate planning strategy, you can:
Decide what happens to the timeshare
Protect your beneficiaries from unwanted burdens
Simplify the administration of your estate
Need Help Addressing a Timeshare in Your Estate Plan?
If you own a timeshare and are unsure how it fits into your estate plan, we can help you evaluate your options and create a plan that works for your situation.
Contact Holt Legacy Law to schedule a consultation.
Prefer to speak with someone directly? Call us at (410) 864-6395. We’re happy to help.
