_______________________________________________
SUBSTITUTE
HOUSE BILL 2513
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Passed
Legislature - 2002 Regular Session
State
of Washington 57th Legislature 2002 Regular Session
By
Read
first time 02/08/2002. Referred to Committee on .
Regulating timeshare interest reservations.
AN
ACT Relating to timeshare interest reservations; amending RCW 64.36.070; and
adding a new section to chapter 64.36 RCW.
BE IT
ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec.
1. RCW
64.36.070 and 1983 1st ex.s. c 22 s 8 are each amended to read as follows:
Any
individual offering timeshare units or timeshare interest reservations
for the individual's own account or for the account of others shall be
registered as a timeshare salesperson unless the timeshare offering is exempt
from registration under RCW 64.36.020. Registration may be obtained by filing
an application with the department of licensing on a form prescribed by the
director. The director may require that the applicant demonstrate sufficient
knowledge of the timeshare industry and this chapter. A timeshare salesperson
who is licensed as a real estate broker or salesperson under chapter 18.85 RCW
is exempt from the registration requirement of this section.
NEW
SECTION. Sec. 2. A
new section is added to chapter 64.36 RCW to read as follows:
(1)
For the purpose of this section, "timeshare interest reservation"
means a revocable right to purchase an interest in a timeshare project for
which construction has not yet been completed and an effective registration has
been obtained under this chapter.
(2)
An effective registration pursuant to this chapter is required for any party to
offer to sell a timeshare interest reservation. Promoters offering a timeshare
interest reservation under this section must provide the registered disclosure
document required by RCW 64.36.140 to each prospective purchaser before he or
she enters into a timeshare interest reservation. Prior to the signing of a
purchase agreement, the subject property or properties must be completed, the
timeshare offering registration required by RCW 64.36.020 must be amended to
reflect any changes to the property and must be reapproved by the department,
the disclosure document required by RCW 64.36.140 must be revised, and the new
version of the disclosure document must be provided to the prospective
purchaser.
(3)
Deposits accepted by promoters on a timeshare interest reservation may be no
more than twenty percent of the total purchase price of the timeshare interest
that is being purchased. Within one business day after being accepted by the
promoter, any deposit on a timeshare interest reservation shall be deposited in
an account in a federally insured depository located in the state of
Washington. This account must be an escrow account wherein the deposited funds
are held for the benefit of the purchaser. The department may request that
deposits be placed in impoundment under RCW 64.36.130.
(4)
In addition to the cancellation rights provided in RCW 64.36.150, the purchaser
has the right to cancel the purchase at any time before the signing of a
purchase agreement. If the purchaser notifies the promoter that he or she
wishes to cancel the timeshare interest reservation, the promoter must refund
the full amount of the deposit minus any account fees within ten days of the
notice.
(5)
If prior to signing a purchase agreement the purchaser learns that the promoter
proposes to raise the purchase price above the price agreed to in the written
reservation agreement for the timeshare interest reservation, the written
reservation agreement is void and all deposit moneys including account fees
shall be returned to the purchaser within ten days after the purchaser learns
of the proposed price increase.
(6)
If the promoter charges account fees to pay for administrative costs of holding
the purchaser's funds in escrow, these fees may be no more than one percent of
the total deposit paid towards the timeshare interest reservation by the
purchaser.
(7)
The promoter shall provide instructions to the escrow company for release of
the funds to be held in escrow in compliance with this section and rules of the
department.
(8)
The purchaser's right to cancel and the amount of the deposit proposed to be
retained for account fees in the event of cancellation must be included in the
contract for the sale of a timeshare interest reservation and the contract must
state:
PURCHASER
CANCELLATION RIGHTS
As a
purchaser of a timeshare interest reservation, you have the right to cancel
this timeshare interest reservation and receive a refund of all consideration
paid (less only those account fee deductions which were fully disclosed at the
time of the agreement) by providing written notice of the cancellation to the
promoter or the promoter's agent at any time prior to signing a purchase
agreement. You also have a right to cancel your purchase within seven days of
signing a purchase agreement.
(9)
If it appears that the timeshare project will become or does become insolvent
prior to completion, the promoter shall instruct the escrow company to
immediately return all deposits to purchasers of timeshare interest
reservations. If funds are returned under this subsection, the promoter may
not retain any portion of the deposits for account fees.
Passed the House February 15, 2002.
Passed the Senate March 5, 2002.
Approved by the Governor
March 28, 2002.
Filed
in Office of Secretary of State March 28, 2002.
