Consumer rights under the purchaser deposit

The laws of some jurisdictions require that all or a portion of the funds or other property received by a developer of a timeshare plan from a purchaser of a timeshare interest in the timeshare plan must be deposited in an escrow account with an independent escrow agent prior to completion of the purchase transaction.

The purchaser is entitled to the return of the funds or other property if the developer defaults under the purchase contract, including the developer's inability to deliver the accommodations and facilities of the timeshare plan as promised. Some jurisdictions permit developers to access purchaser funds or property prior to meeting the conditions for releasing the funds or property by providing an alternative assurance covering the purchaser funds or property. Alternative assurances can include such arrangements as the posting of a letter of credit or obtaining a security bond in the full amount of the funds or property that are deposited in the escrow account. Funds or property covered by the alternate assurance are released as the conditions for release from escrow are met, and any funds collected in excess of the amount of the alternate assurance must be deposited in the escrow account until the total amount of funds or property covered by the alternate assurance is again below the alternative assurance limit.