Timeshares are complicated. The basics are the same: pay to use a property for a certain amount of time every year to vacation.
In this post, we’re going to talk about Right to Use (RTU) timeshares. Specifically, we’re going to look at what a Right to Use timeshare is plus RTU vs deeded or fractional ownership timeshares.
Right to Use (RTU) timeshares differ from traditional timeshares in that you have the right to use the timeshare for a specific period of time-based on the contract. You are not locked into the timeshare for life. Right to Use timeshares are particularly common in places like Mexico and other countries where limits are placed on foreigners owning real estate.
Let’s break this down into easier-to-understand parts.
To help you wrap your head around this, we’ll use a deeded (also known as a fractional ownership) timeshare as comparison.
With a fractional ownership timeshare, you are given a deed or title to the property. Think of it like the deed to a house or a title to a vehicle.
The difference from owning a deed on a house or a condo and a deeded timeshare is that you only own a fraction of the timeshare (thus “fractional timeshare”). What this means is that you only own the exclusive rights to your unit on certain weeks every year.
A Right to Use or RTU timeshare gives you no ownership in the property. However, you still have the right to use the property only at certain times.
The main difference between RTU and a traditional timeshare is that you have a fixed number of years that you can use the property. Once that time is up, so is your right to use the timeshare (more on this in the next section).
This could make RTU timeshares attractive to some people. I’m not going to tell you whether a timeshare is a good idea. That’s for you to decide.
I will, however, provide you the information you need in order to make an informed decision.
RTU (or Right to Use) Timeshare Terms
Right to Use timeshares or RTU timeshares, as was stated earlier, only allow a person to visit the timeshare under the conditions or terms of the contract.
These terms can vary.
The time that you will be under this contract could last from 20 years all the way to 99 years.
Everything else related to owning a timeshare still applies. You will still will be responsible for maintenance fees, assessment fees, taxes if applicable, as well as homeowner association fees (HOA) if the property has them.
These contracts can also get very creative.
These are known as an “accelerated program”.
For example, in an accelerated program, you will get to use the property for two or three weeks one year. Then the next year, you cannot use the property. In year three, you’ll be back for the number of weeks stated in your contract. The next year, you can’t stay.
And it will go back and forth like that until the contract is up.
It is completely understandable if you’re now asking, ‘If I have to pay all the associated fees of owning a timeshare but can only use it every other year, why bother with a RTU timeshare?’
That’s a great question!
The reason why this appeals to some people is because right-to-use timeshares (RTU) usually require less money upfront to get into.
And because it’s a contract, you can structure the terms to fit your lifestyle.
Perhaps you’re the type that doesn’t want to visit the same place all the time. But you do want the option to visit a place you like from time to time.
Maybe you want to stay at the timeshare this year. Next year, you might want to book a cruise.
With a Right to Use timeshare, you would – in theory – get the best of both worlds. And you won’t feel like you’re wasting money if you go somewhere other than your timeshare.
Other Details to Keep in Mind
Some other details to keep in mind when considering Right to Use (RTU) timeshares are:
- Your stay can be fixed week, floating week, or points based
- Will usually see RTU timeshares in countries that limit foreign real estate ownership
- Not lifelong ownership
- Terms are flexible. But can go from 20 years to 99 years
- Still have to pay regular timeshare fees such as maintenance fees
- You don’t “own” anything. The management company or developer owns the actual real estate
- Initial investment is lower than with a traditional timeshare
- Can sell or pass it on to family. But they will still be under the terms you agreed to
Differences Between Right to Use and Traditional Timeshares
To make it easier to figure out the differences between a Right to Use timeshare and traditional timeshare, I’ve made this comparison chart:
|Right to Use Timeshares||Traditional Timeshares|
|– Stay is limited to the terms of the contract||– Lifelong ownership|
|– Own nothing||– Own a portion of the property|
|– Terms are flexible||– Terms are fixed|
|– Usually found outside United States||– Found most places timeshares are sold|
|– Costs less upfront to get into||– Costs more upfront to get into|
Take a look at these before you go to a timeshare presentation, so you’ll be ready for what the salesperson throws at you.
And if you found this content useful, we’d be honored if you shared it with your friends and family on your favorite social media network.
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