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A BILL TO BE ENTITLED
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AN ACT
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relating to the transfer or termination of certain timeshare |
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interests. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 221.003(b), Property Code, is amended to |
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read as follows: |
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(b) Timeshare properties located outside this state are |
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subject only to Subchapters C through H and J. |
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SECTION 2. Chapter 221, Property Code, is amended by adding |
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Subchapter J to read as follows: |
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SUBCHAPTER J. SERVICE AGREEMENTS TO TRANSFER OR TERMINATE A |
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TIMESHARE INTEREST |
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Sec. 221.101. TRANSFER OR TERMINATION OF TIMESHARE |
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INTEREST. In this subchapter: |
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(1) "Termination" with respect to a timeshare |
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interest: |
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(A) means: |
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(i) the release of contractual obligations |
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relating to a timeshare interest by the developer, association, or |
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managing entity; or |
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(ii) the invalidation of a timeshare |
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interest by a judgment or court order; and |
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(B) does not include the cancellation of a |
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purchase contract governed by Subchapter E. |
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(2) "Transfer" with respect to a timeshare interest |
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means the conveyance of all or substantially all of a timeshare |
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interest. |
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Sec. 221.102. APPLICABILITY. (a) This subchapter applies |
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to a timeshare interest if the timeshare interest has been acquired |
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only for the purchaser's personal, family, or household use and: |
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(1) the timeshare interest is owned by a resident of |
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this state; |
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(2) the timeshare property is located in this state; |
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or |
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(3) the timeshare interest acquired is in a multisite |
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timeshare plan required to be registered under Subchapter C. |
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(b) Except as provided by Subsection (c), this subchapter |
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applies to a person who: |
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(1) is acting in the ordinary course of business; and |
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(2) directly or indirectly, regardless of whether |
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acting in person, by mail, by telephone, or by any mode of Internet |
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or electronic communication, offers or advertises an offer to |
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engage in, for consideration, the following activities: |
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(A) obtaining or attempting to obtain on behalf |
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of a timeshare interest owner: |
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(i) a release of the owner's timeshare |
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interest from any person, including the developer, association, or |
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managing entity; or |
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(ii) a judgment or court order invalidating |
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the owner's timeshare interest; |
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(B) selling, renting, listing, or advertising a |
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timeshare interest on behalf of a timeshare interest owner; |
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(C) purchasing a timeshare interest from a |
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timeshare interest owner; or |
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(D) assisting in the transfer of an owner's |
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timeshare interest. |
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(c) This subchapter does not apply to: |
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(1) a license holder under Chapter 1101, Occupations |
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Code, acting as a broker, agent, or salesperson under that person's |
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license in connection with the transfer or termination of a |
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timeshare interest; |
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(2) a developer, association, or managing entity for a |
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timeshare interest to be transferred or terminated; or |
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(3) an attorney, title agent, title company, or escrow |
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company that: |
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(A) provides only closing, settlement, or other |
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specific transaction services in connection with the transfer or |
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termination of a timeshare interest; and |
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(B) does not otherwise engage in activities |
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described by Subsection (b). |
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Sec. 221.103. GENERAL DISCLOSURES REQUIRED. A person |
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subject to this subchapter who enters into an agreement with a |
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timeshare interest owner to facilitate the transfer or termination |
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of a timeshare interest shall provide to the timeshare interest |
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owner the following written disclosures, as applicable: |
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(1) the name, telephone number, and physical address |
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of the person providing services under the agreement and any |
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affiliate, agent, or third-party representative of that person; |
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(2) a description, legally sufficient for |
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identification, of the timeshare interest to be transferred or |
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terminated; |
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(3) a description of the method of transfer or |
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termination or a copy of the instrument that will be used for |
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transferring or terminating the timeshare interest; |
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(4) a description of any interest the timeshare |
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interest owner retains after the transfer; |
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(5) a description of the scope of a power of attorney |
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or other delegation of authority, if any, that the timeshare |
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interest owner is required to give to complete the transfer of the |
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timeshare interest; |
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(6) an itemized statement of any amounts the timeshare |
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owner is required to pay as consideration or reimbursement for |
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services provided in connection with the agreement; |
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(7) the name of each recipient of amounts described by |
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Subdivision (6); |
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(8) the estimated date for completing all services |
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sufficient to transfer or terminate the timeshare interest; and |
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(9) a statement that, on completion of the transfer or |
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termination of the timeshare interest, the person will give written |
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notice of the transfer or termination to: |
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(A) the developer, association, or managing |
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entity, as applicable; and |
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(B) if applicable, the exchange company for the |
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timeshare interest. |
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Sec. 221.104. DISCLOSURE OF AUTHORIZED USE OF TIMESHARE |
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INTEREST. (a) A person subject to this subchapter who enters into |
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an agreement with a timeshare interest owner to facilitate the |
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transfer or termination of a timeshare interest shall disclose in |
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writing to the timeshare interest owner the name of any person, |
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other than the timeshare interest owner, who may occupy, rent, |
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exchange, or otherwise use the timeshare interest during the term |
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of the agreement. |
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(b) If a person is authorized to occupy, rent, exchange, or |
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otherwise use the timeshare interest during the term of the |
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agreement, the agreement must state the name of each person |
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receiving consideration for the occupation, rent, exchange, or use |
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of the timeshare interest. |
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Sec. 221.105. DISCLOSURES RELATING TO PAYMENT OF FEES FOR |
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TRANSFER SERVICES. A person subject to this subchapter who enters |
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into an agreement with a timeshare interest owner to facilitate the |
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transfer of the timeshare interest must disclose in writing to the |
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timeshare interest owner that the timeshare interest owner is not |
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required to pay any consideration or reimbursement under the |
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agreement until the timeshare interest owner receives: |
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(1) a written acknowledgement from the developer, the |
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association, or the managing entity that the person facilitating |
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the transfer under the agreement complied with all applicable |
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policies, if any, governing the transfer of the timeshare interest; |
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and |
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(2) a copy of the instrument transferring the |
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timeshare interest, recorded, if required by applicable law, in the |
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real property records of the county in which the timeshare property |
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is located. |
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Sec. 221.106. REQUIRED NOTICE FOR TRANSFER SERVICES. A |
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person subject to this subchapter who enters into an agreement with |
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a timeshare interest owner to facilitate the transfer of the |
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timeshare interest must provide to the timeshare interest owner a |
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statement printed in 14-point boldface type or 14-point uppercase |
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typewritten letters that reads substantially similar to the |
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following: |
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I (name of the person facilitating the transfer) WILL ACT IN |
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GOOD FAITH AND IN A COMMERCIALLY REASONABLE MANNER TO COMPLETE THE |
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TRANSFER OF OWNERSHIP OF YOUR TIMESHARE INTEREST NOT LATER THAN THE |
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180TH DAY AFTER THE DATE OF THIS AGREEMENT. |
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YOUR OBLIGATION TO PAY ALL COSTS AND FEES ASSOCIATED WITH |
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YOUR TIMESHARE INTEREST, INCLUDING ANY REGULAR OR SPECIAL |
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ASSESSMENTS OR REAL OR PERSONAL PROPERTY TAXES, DOES NOT CEASE BY |
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VIRTUE OF THE EXECUTION OF THIS AGREEMENT. |
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IF THE TRANSFER OF YOUR TIMESHARE INTEREST IS NOT COMPLETED |
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BEFORE THE 180TH DAY AFTER THE DATE OF THIS AGREEMENT, YOU WILL |
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CONTINUE TO BE RESPONSIBLE FOR THE PAYMENT OF ALL COSTS AND FEES |
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ASSOCIATED WITH YOUR TIMESHARE INTEREST, INCLUDING ANY REGULAR OR |
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SPECIAL ASSESSMENTS OR REAL OR PERSONAL PROPERTY TAXES. |
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Sec. 221.107. REQUIRED NOTICE FOR TERMINATION SERVICES. A |
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person subject to this subchapter who enters into an agreement with |
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a timeshare interest owner to facilitate the termination of the |
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timeshare interest must provide to the timeshare interest owner a |
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statement printed in 14-point boldface type or 14-point uppercase |
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typewritten letters that reads substantially similar to the |
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following: |
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I (name of the person facilitating the termination of the |
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timeshare interest) WILL ACT IN GOOD FAITH AND IN A COMMERCIALLY |
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REASONABLE MANNER TO COMPLETE THE TERMINATION OF YOUR TIMESHARE |
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INTEREST NOT LATER THAN THE 180TH DAY AFTER THE DATE OF THIS |
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AGREEMENT BY OBTAINING: |
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(1) A VALID AND ENFORCEABLE RELEASE FROM THE |
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DEVELOPER, ASSOCIATION, OR MANAGING ENTITY; OR |
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(2) A JUDGMENT OR COURT ORDER INVALIDATING THE |
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PURCHASE OR OWNERSHIP OF YOUR TIMESHARE INTEREST. |
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YOUR OBLIGATION TO PAY ALL COSTS AND FEES ASSOCIATED WITH |
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YOUR TIMESHARE INTEREST, INCLUDING ANY REGULAR OR SPECIAL |
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ASSESSMENTS OR REAL OR PERSONAL PROPERTY TAXES, DOES NOT CEASE BY |
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VIRTUE OF THE EXECUTION OF THIS AGREEMENT. |
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I CANNOT GUARANTEE THAT I WILL SUCCESSFULLY COMPLETE THE |
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TERMINATION OF YOUR TIMESHARE INTEREST. IF I FAIL TO COMPLETE THE |
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TERMINATION OF YOUR TIMESHARE INTEREST, YOU WILL CONTINUE TO BE |
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RESPONSIBLE FOR THE PAYMENT OF ALL COSTS AND FEES ASSOCIATED WITH |
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YOUR TIMESHARE INTEREST, INCLUDING ANY REGULAR OR SPECIAL |
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ASSESSMENTS OR REAL OR PERSONAL PROPERTY TAXES. |
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Sec. 221.108. RELIANCE. In making disclosures required by |
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this subchapter, a person facilitating the transfer or termination |
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of a timeshare interest may rely on written information provided by |
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the timeshare interest owner, the developer, the association, or |
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the managing entity. |
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Sec. 221.109. DUTY OF GOOD FAITH REGARDING TRANSFER OR |
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TERMINATION SERVICES. A person facilitating the transfer or |
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termination of a timeshare interest must act in good faith to |
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accomplish the transfer or termination not later than the 180th day |
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after the date the person enters into an agreement with the |
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timeshare interest owner. |
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Sec. 221.110. DECEPTIVE TRADE PRACTICES. A person subject |
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to this subchapter commits a false, misleading, or deceptive act or |
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practice within the meaning of Sections 17.46(a) and (b), Business & |
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Commerce Code, by engaging in any of the following acts: |
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(1) failing to disclose information as required by |
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this subchapter; |
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(2) making false or misleading statements concerning: |
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(A) the existence of an offer related to the |
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purchase or rent of a timeshare interest; |
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(B) the likelihood of the completion or the time |
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necessary to complete any sale, rental, transfer, or termination of |
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a timeshare interest; |
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(C) the value of a timeshare interest; |
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(D) the current or future costs, including |
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assessments, maintenance fees, or taxes, of owning a timeshare |
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interest; |
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(E) the method by which or source from which a |
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timeshare interest owner's name, address, telephone number, or |
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other contact information was obtained; |
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(F) the identity of the person providing services |
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to facilitate the transfer or termination of a timeshare interest |
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or any affiliate, agent, or third-party representative of that |
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person; |
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(G) the terms and conditions under which services |
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to facilitate a transfer or termination of a timeshare interest are |
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offered; |
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(H) the willingness of a developer, association, |
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or managing entity to: |
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(i) agree to the transfer or termination of |
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a timeshare interest; or |
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(ii) execute instruments necessary to |
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transfer or terminate the timeshare interest; or |
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(I) the manner in which consideration or |
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reimbursements paid by a timeshare interest owner will be used or |
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applied; or |
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(3) encouraging or inducing a timeshare interest owner |
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to stop paying the developer, the association, or the managing |
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entity in violation of a contract with the developer, the |
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association, or the managing entity before the completion of a |
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transfer or termination. |
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Sec. 221.111. SUPERVISORY DUTIES. (a) The person who |
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enters into an agreement to facilitate the transfer or termination |
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of a timeshare interest shall supervise, manage, and control all |
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aspects of the services provided under the agreement. |
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(b) Any violation of this subchapter that occurs during the |
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provision of services is considered a violation by the person who |
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enters into the agreement and any affiliate, agent, or third-party |
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representative of that person. |
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(c) Section 221.035 does not apply to a person providing |
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services under this subchapter. |
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SECTION 3. (a) The disclosure and notice requirements |
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provided by Subchapter J, Chapter 221, Property Code, as added by |
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this Act, apply only to an agreement to facilitate the transfer or |
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termination of a timeshare interest entered into on or after the |
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effective date of this Act. An agreement to facilitate the transfer |
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or termination of a timeshare interest entered into before the |
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effective date of this Act is governed by the law as it existed |
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immediately before the effective date of this Act, and that law is |
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continued in effect for that purpose. |
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(b) Section 221.110, Property Code, as added by this Act, |
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applies only to conduct that occurs on or after the effective date |
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of this Act. Conduct that occurs before the effective date of this |
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Act is governed by the law as it existed when the conduct occurred, |
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and the former law is continued in effect for that purpose. |
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SECTION 4. This Act takes effect September 1, 2015. |