Residency Program in Cancun, Mexico

So during my recent stay from 30 Dec 2019 until 2 January 2020 at Villa del Palmar – Cancun, Mexico, I was introduced to the Residency Program by the Concierge on the ground at the premises. I was invited to a free breakfast for me and my family, where they would only take 90 minutes of my time and where after I could enjoy 10% discount on hotel amenities and 50% discount on the first tour I book from a list of selected tours and excursions.

It seemed like a no-brainer so we scheduled for the next morning. “Come hungry” they said.

The next morning a sales agent joined us at the concierge desk and took us to breakfast, but only after sharing my credit card details and passport, including that of my wife (First warning flare went up).

Breakfast was small talk and basically prepared us for signing a ‘timeshare’ deal (they make a point of bad mouthing timeshare schemes and explain to you that this Residency Program is definitely not a timeshare scheme, due to: (1) Availability is guaranteed due to them only relying on 80% and not 130% occupancy as with timeshare schemes. (2) Other than with timeshare schemes which have lifelong durations, you can get out at any point after the first year.

I’ll get back to these 2 points later on, in explaining why this is actually a lot worse than a timeshare deal.

On finishing our leftover breakfast, we were shown a newly built unit in one of their sister hotels, currently under phased development, named Garza Blanca. The development was 5-star and the pitch contained a lot of empty promises, I am not sure they would be able to deliver on, including a lot of blah-blah about 5-diamond awards, etc. The amount of pictures we were shown about future developments was also rather overwhelming.

On completion of this excursion, you can’t just go yet, even if you are not interested in their program, as you have to first complete the sign-out process, which involves a trip down to their marketing office where you are further romanced with champagne and other drinks on the house. That is when you are shown the opportunity to invest and what it will cost. “You are an investor”, not a timeshare owner…

On thanking them and wanting to leave, they first need to understand why you do not want to invest and when your reason is given, the Manager first needs to have a word with you. By now, you start feeling as if you are in trouble. The Manager then graces you with her presence and once they understand exactly why you are not interested in investing, they basically drop the price in half.

<A word on the points based system they offer: By selling you points, redeemable for a number of nights at hotels with selected ratings, they put themselves in a position to increase the number of points required for a selected stay at any point in time without notice, which will put you out of the market at some point in time, forcing you into a necessary upgrade. In this way they don’t have to guarantee availability, they just increase the number of points required which cause you to not qualify, so availability increases>

Now you start showing interest and request to see the contract for any fine print? They cannot show you the contract just yet, you first need to sign a term sheet and pay a $1 000 deposit (which deposit was $2 500 just a second ago) that will allow them to secure the deal and print you the contract. Why? Well, once you’ve paid the deposit, it’s non-refundable (Second warning flare went up), so I refer to this point in time as the tipping point in the decision making process, as all of us hate losing money, so it’s a catalyst for them to make you sign the contract. But then again, on all the promises made to this point and with the option to get out after the first year, what could go wrong? I mean the first capital payment, pays for the first year of holiday, so it’s a breakeven in the first year and then I can cancel and get out, right?

So I sign the term sheet and my credit card is taken to the back office, after 10 minutes they return with the contract. I start reading and the sales agent interrupts me, pointing to the cancelation clause which reads that you have only 5 days to cancel the contract post signature, thereafter you cannot cancel and it runs a debit order for the next 50 years.

Remember I said that timeshare schemes have a lifetime duration (which I think was declared ******* in certain states), well they changed it to 50 years. So me being 40 years of age am in this for at least my life. Another form needed to be signed where I give them priority to claim any shortfalls (entirely up to their discretion) from my deceased estate in case I die and any of the 50 years outstanding remains. And yet another form, which gives them permission to credit check at will and if you miss any payments - and we all know what happens if you are credit vetted continuously - your credit rating drops, so you’ll end up paying to protect your profile.

By now warming flares are going off all over the show and here’s the final straw on the camel’s back. The sales agent tells me, that even though the contract reads no cancelation after 5 days post signature, it doesn’t actually mean that and I can cancel at any point after the first year. I ask the sales agent where the clause is that allows me to cancel at any point after the first year. She says that it’s there somewhere, so I read the contract again. By now she’s running around all over the show consulting other agents to salvage the situation. She returns and tells me that actually I cannot cancel at any point and that I am in it for 50 years and apologises for the ‘misunderstanding’. Last time I checked, that was called lying…

The lie which kept me busy for half a day on my family holiday, finally made me walk away and you know what, I still felt bad. Arriving back at home, from my family holiday, 10 days later, I found out that they charged me the $1 000 on my credit card for which I signed the term sheet, allowing them to print the contract.

Happy Holidays and step away from Residency Programs, in many ways it’s worse than timeshare!

F Smuts

Footnote: The 50% discount receivable on the first tour booked, was only applicable to 2 or 3 available tour operators and they were all fully booked for the duration of our stay. The 10% discount on hotel amenities helped a bit.