Alternative types of owning real estate, such as condominiums and timeshares, have gained in popularity over the last twenty-five years. Misinformation, and occasionally fraudulent acts, have sometimes plagued consumers and developers. Several laws require that developers register their ventures with appropriate authorities and provide potential purchasers with specific information.
A condominium form of ownership means that individual owners own their specific units and have shared ownership of the grounds, facilities and the like. Individual owners pay a monthly fee to cover the costs of services, such as shared maintenance and insurance. In contrast, a cooperative form of ownership means that owners own shares in the corporation that owns the building or buildings in which they live. Each resident then rents a unit from the corporation, with the rent including the shared costs for mortgage, maintenance, taxes, and so forth.
Timeshares can be a convenient way to "own," or have rights to, vacation properties. With timesharing, owners do not own a particular unit but have a deeded right or a right to use a unit for a certain period of time every year. Fees cover the timeshare owner's portion of the mortgage, taxes, insurance and maintenance.
The primary statutes are the federal Land Sales Full Disclosure Act, the New Hampshire Land Sales Full Disclosure Act and New Hampshire RSA 356-C. Any condominium of more than 10 units, all "timesharing" developments, and subdivisions of more than 15 lots must register with, or formally be exempted by, the New Hampshire Attorney General. The registration (or exemption from the registration) must happen before the developer sells or offers for sale, any units, timeshare interests, or lots. This law also requires that the developer present all material facts about the property to potential buyers (a fact is "material" if it would influence the average person's decision to buy the property). Furthermore, the law requires that buyers' deposits must be held in escrow until the closing. Some projects must present a public offering statement to each buyer before or at the time of purchase. In addition, under the law buyers usually may cancel their purchase within five days after signing the purchase contract or five days after receiving the public offering statement whichever is later.
New Hampshire's RSA 356-C covers the rights of tenants in buildings being converted from rental property to condominium or cooperative ownership. Tenants have specific legal rights during the conversion process.
Tenants choosing not to buy their units have either 270 days or until the lease expires, whichever is longer, before being required to vacate the unit. For elderly or disabled tenants choosing not to buy, the developer must allow 18 months before requiring them to move.
Timeshare managements are usually governed by long, complicated legal documents. Timeshare owners often have the right to "bank" or trade their rights and get access to other timeshare vacation properties. Timeshare promotions may entice you to visit with prizes or free accommodations. The value of the promotional offerings may be overvalued and even misrepresented. It is important to learn all you can about timeshare ownership in general and the particular development where you may be purchasing. It is also important to avoid high pressure sales tactics until you or your lawyer have carefully reviewed the public offering statement and other documents connected with the timeshare. In most instances, a timeshare buyer has five business days to cancel a timeshare purchase agreement.
Example: While vacationing in the White Mountains, Jimmy and Jamie accept an offer to "get a free weekend vacation getaway, just for touring Rochmore Vacation Estates," a timeshare resort. After a 5-hour tour and presentation, the saleswoman gives them a "declaration," "bylaws," "public offering statement" and other marketing information. She presses them to "Make up your minds quickly because the prime timeshare weeks are selling out fast!" Jimmy and Jamie refuse to make a decision on the spot, agreeing only to look the documents over when they get home from their vacation.
Points To Remember
Where To Go If You Have A Problem
Contact the NH Consumer Protection and Antitrust Bureau if you have a problem or concern about a condominium conversion or timeshare:
NH Consumer Protection and Antitrust Bureau
33 Capitol Street
Concord, NH 03301-6397
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New Hampshire Department of Justice | 33 Capitol Street | Concord, NH | 03301