When you purchase a week of timeshare, points in a timeshare points-club or other long-term holiday ownership products an initial purchase price is paid to the vendor for which you receive the right-of-use of the product for a given number of years. Full details of this right-of-use will be in the contract and/or governing documents. In addition to the initial purchase price ownership also requires the payment of an annual charge – often referred to as the resort maintenance fees or management fees.
These fees are collected each year and are used for the management and maintenance of all the resort accommodation, grounds and facilities. A small amount is often included in the fees to act as a ‘reserve fund’ or ‘sinking fund’ to cover unforeseen eventualities or any major refurbishment that may become necessary.
When purchasing a timeshare or similar product from a developer, resale agent or private vendor the documentation you will be asked to sign will include a legal commitment to comply with the governing document of the product (often called the Constitution or Regulations). This includes a commitment to pay the ongoing annual charges.
Further information on this can be found in TATOC Consumer Guide 81 here.