Timeshares or timeshares are known for how expensive they are. They are properties you will buy for a period generally used for vacationing. Because of their high value, it is common to borrow money to buy one.
When you notice the high-interest rates and payments you must make, it is common to start looking for a refinance to catch up with the costs and finish as quickly as possible with the debt. If you wish, you can do this, but remember to find the right lender.
Procedure for refinancing a timeshare
The lender’s interest rate can be very high for timeshares. It is essential to find the appropriate company for financing. Few lenders advertise their refinancing options, but that doesn’t mean they don’t exist. Some loans you can use are:
- Home equity loans: will give you lower interest rates and is ideal if you have collateral built up on your home. Before applying, make sure you can pay the loan with this refinancing
- Personal loan: if you have good credit, the best solution is a personal loan to refinance the timeshare
- Credit card with 0% APR: if you can make a balance transfer with 0% APR using your credit card, the loan payment is faster. But you must be careful not to accrue interest again
- A secured line of credit: thanks, a HELOC will help you repay the loan at a low rate, but you need to make sure you will have the means to make the payments because your home will be at risk
What is the best alternative?
If the timeshare loan is inconveniencing you, the best thing to do is refinance it, but this is not the only alternative available. Among the options you will find:
- Rent your timeshare: this way, you will be able to keep it while you are not using it; this allows you to recover part of the costs you have had since you acquired it
- Sell your timeshare: evaluate whether you constantly use your timeshare; if not, selling it would be an excellent solution to pay the loan and not continue generating debts
- Make the full payment: if you have enough cash, catch up with the loan and keep your timeshare
- Ask for help from a company: if you want to stop having your timeshare but you cannot sell it, ask for advice from a company specialized in such cases for the cancellation of the product. Although it is also an expensive option
Do a credit check
The lender will check your credit report before applying for the loan, evaluate your credit score, and ensure all the information is correct to refinance your timeshare.
Find the best rates
Once you know what type of financial product you prefer for your loan financing, start requesting quotes. Almost all lenders will offer you rate quotes without pre-verifying your credit.
Once you have all the options, it’s time to complete the refinance application; make sure you have all the necessary documents and don’t lose contact with your lender. Ask all the questions required before agreeing.
Is timeshare refinancing a good alternative?
As mentioned before, refinancing is not a good solution in all cases. You can opt for this option when you want to keep your timeshare because you use it and do not see a sense in selling it.
It is also the best alternative to find a lower interest rate; this is simple when you have solid credit. Likewise, refinancing is an effective alternative if you intend to make lower monthly payments.
If you have bad credit, it is not advisable to refinance your timeshare because you will have higher interest rates. Eventually, you will only generate more debt. It is also not a solution when you want to get rid of your timeshare.
If you no longer want to deal with it, the most sensible thing is to sell it or requesting a cancellation. Before making any decision, you should seek professional advice. Remember that you should not buy a timeshare if you are not sure if you can afford all the expenses it generates.