Condo Association Management Blog

How to rid of timeshares bottlenecking financing to condo association?

  

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I am an owner of one of 7 units that are quarterly/seasonal timeshares (fractional ownership)in Maryland, the other 27 units in the building are residential. Recently our timeshare association was advised that the previous property manager never did the proper paperwork to register our timeshare association with the State of Maryland and thus we do not exist. The timeshare association has been working as an association for 20 years. The timeshare units have been bought and sold repeatedly over the years. Because of a recent law (Fannie Mae Review Process B4.2.1-02, Ineligible Projects, 10/30/2009 https://www.efanniemae.com/sf/guides/ssg/sg/pdf/sg1209.pdf#page=575) it has just come to light that the developer in 1990 failed to properly document the transfer of the property, thereby showing one owner for all seven units ( him a limited partnership). The timeshare unit owners have a deed with their name on it and it is recorded at the Courthouse. So we have paid for the timeshares, have deeds in our name, the deeds are recorded in Land Records but the 7 timeshare units are owned on paper to a partnership. Because of recent legislation, (see link above) the residential unit owners are now being impacted because of the timeshares in their building. (Fannie Mae Review Process B4.2.1-02, Ineligible Projects, 10/30/2009) Individuals are unable to get loans to buy units or to re-fi them because of the timeshares, and the failure of the developer to properly document the transfer (one owner for all seven timeshare units). The rest of the units in the building will continue to decrease in value unless all of the timeshares get out of the timeshare designation. Any suggestions as to how unwind and get out of the timeshares. Getting people to agree may be a problem. I would love to purchase our timeshare and get out of the timeshare completely. But if timeshare holders in a unit don’t want to sale, can we create a partnership, or something like that. Of course we would have to have a contract to have some ground rules. Looking for solutions. Help.