32-2197.16. Separate disclosures

A. The purchase agreement must contain a separate disclosure document that discloses all of the following in at least ten-point type:

1. If the purchaser signs the purchase agreement, the purchaser has ten days to cancel the purchase agreement without a penalty.

2. If the purchaser signs the purchase agreement, the purchaser may be responsible for paying maintenance fees, taxes and other assessments every year for the duration of ownership.

3. Timeshares are not investments.

4. The purchase agreement is final and any conflicting statements made by the seller are not part of the purchase agreement.

5. The purchaser has the right to file a consumer complaint with the attorney general.

B. Before entering into a purchase agreement, the seller must provide the purchaser with a separate disclosure document to adequately inform the purchaser of the purchaser's actual and potential liabilities under the purchase agreement. At a minimum, this separate disclosure document must conspicuously disclose all of the following:

1. The duration of the timeshare agreement entered into by the purchaser or whether the agreement has no set duration.

2. A good faith estimate of the total potential financial obligation of the purchaser during the first year of ownership that includes additional charges to which the purchaser may be subject during the first year of ownership, including all potential assessments. The disclosure shall be as follows:

(a) If the maximum amount of the first year's assessments is known at the time of purchase, the disclosure must disclose the maximum amount of these assessments and the assessments levied for each of the previous three years, if available.

(b) If the maximum amount of the first year's assessments is unknown at the time of purchase, the disclosure must provide the purchaser with the following:

(i) Notice that the purchaser will be required to pay assessments in addition to the disclosed purchase payment and that the amount of those assessments is currently unknown.

(ii) A statement disclosing the assessments levied for each of the previous three years, if available, and a good faith estimate of the first year's assessments that is at least the highest amount assessed during any of the previous three years based on the timeshare interest being offered.

(iii) Unless the purchase agreement provides for a limit on assessments during the first year of ownership, an affirmative statement that there is no limit on the assessments that the purchaser may be charged in the first year of ownership.

C. If there are blank spaces in the purchase agreement or the disclosure documents prescribed by this section, the contract is voidable.

D. The purchaser must separately initial each disclosure prescribed by subsection A of this section, sign the separate disclosure prescribed by subsection B of this section and verify that the purchaser has read and understands the information presented in the separate disclosures. An initialed copy of the separate disclosure prescribed by subsection A of this section and a signed copy of the separate disclosure prescribed by subsection B of this section shall be provided to the purchaser for the purchaser's records at the time of signing, and the seller shall keep a signed copy of the separate disclosures.

E. The commissioner may recommend or require that the separate disclosures be in a specified form. The form must contain the information required by this section.