Exchange companies are businesses that create networks of timeshare resorts and then oversee the exchanging of timeshare units between you, the owner, and other people who have bought timeshare units at other resorts around the world. Most of the exchange companies have their own ratings systems to help you understand what you will be getting for your unit's exchange value, and many also offer things like unit upgrades, bonus time for extending your vacation at given resorts, and other timeshare-user perks.

Different exchange companies charge different fees — for membership, for exchanges in the United States and abroad, for adding bonus time to your ownership, and more — and they offer different services on the whole. Some handle exchanges only, while others also offer advertising and Internet support for timeshare renting and resale. The bigger exchange companies are part of huge worldwide corporations that also include car-rental companies, hotel properties, discount airline ticket Web sites, and more. If you join one of the bigger companies, your membership will include subscriptions to glossy magazines offering you access to everything from discounted cruise-ship vacations to vacation insurance.

The way exchange companies handle the actual exchanges can differ, too. Some force you to pay the exchange fee and deposit the week that you own into their system first, so other people can decide whether they want it, while other companies allow you to choose your exchange resort of choice first, then pay a fee and deposit the week you own afterward. (You will learn more about how these systems work in Chapter 12.)

Some people try to game the system by working with more than one timeshare exchange company at a time, but if you work with multiple exchange companies, you run the risk of trading away the single week you own to more than one person. If this happens, you would be liable for double or triple booking penalties from multiple exchange companies and, possibly, the resorts themselves.

Which exchange company should you choose? Often, it's not up to you. Some timeshare purchases include complimentary membership in one of the larger exchange companies, and some brand-name resort developers allow you to use only the exchange company with which they are affiliated. You should ask before buying any timeshare unit whether you will be forced to work with a particular exchange company and what penalties you might incur if you go outside the system in search of a better deal.

While there are several brand-name hotel developers getting into the timeshare business by offering their unit owners exchanges among only a handful of resorts, most developers are affiliated with the two exchange companies that continue to dominate the timeshare industry. The biggest is Resort Condominiums International, and its largest rival is called Interval International.

There are smaller exchange companies, as well, which you will read about toward the end of this chapter, but you should start your industry education by taking a look at its biggest players.

Resort Condominiums International

Often referred to as RCI, Resort Condominiums International is the world's leading timeshare exchange company. It had more than three million members as of 2004, and in that same year confirmed about 2.6 million timeshare exchanges — earning a fee of about $150 for each week of domestic exchange and about $189 for each week of international exchange. You don't need to be a math wizard to understand the huge financial power on which the company has built its brand.

As of this printing, Resort Condominiums International was part of the Cendant Corporation, which also owns the Avis and Budget rental car companies, the discount airline-ticket Web site www.cheaptickets.com, and hotel companies including Days Inn, Howard Johnson, Ramada Inn, Super 8, Travelodge, and Wyndham. Plans were in the works to break Cendant into smaller companies in early 2006, though only time will tell which division, if any, will include Resort Condominiums International in the future.

Resort Condominiums International itself has been around since 1974, when it incorporated in Virginia and opened its first office in Park Fletcher, Indianapolis. It had 453 members that year and didn't even publish its first resort directory until a year later. That year, RCI confirmed just 236 timeshare exchanges.

Today, the Resort Condominiums International directory is so big that it is easier to search through the company's affiliated resorts via the Internet, at the company's Web site, www.rci.com. There are so many resorts to choose among — nearly 4,000 as of early 2006 — that you have to start by selecting a continent, then a nation, then a state or region, and so forth. You can even search based on the activities you prefer, such as beach-going, golfing, and snow-skiing, as there are literally hundreds of resorts offering each. You also can search based on a resort's ranking, be it well-known for hospitality or for other forms of service.

Interval International

Interval International is the biggest competitor to Resort Condominiums International. The company's exchange network includes more than 2,000 properties in seventy-five countries around the world and nearly two million global timeshare owners. It has been in business since 1976, earning a solid reputation for treating its customers far better than those fly-by-night salesmen of old. As if to make the point, Interval International calls itself “The Quality Vacation Exchange Network.”

The company's world headquarters is in Miami, Florida, though it maintains more than two dozen other offices worldwide. As of this writing, Interval International's exchange fees were slightly lower than those at Resort Condominiums International, with Interval International charging about $130 per week for domestic timeshare exchanges and about $150 per week for international timeshare exchanges. More than 850,000 timeshare exchanges were made through Interval International in 2004 alone, and the company boasts more than 1.7 million members.

Interval International is part of IAC/InterActiveCorp, which also owns Ticketmaster, the Home Shopping Network, and popular consumer-service Web sites such as www.ask.com and www.lendingtree.com. As of its last membership profile, Interval International's average U.S. member was about forty-nine years old, married, and earning $114,200 in household income. The average member spends about thirty-five nights each year traveling for leisure — a fact that is important in making timeshare purchase financially smart (which you will learn more about in Chapter 2).

The Interval International Web site, www.intervalworld.com, offers basic information about the company, but it has no searchable resort database available to nonmembers. You can, however, request a copy of the company's printed resort directory, which is more than 500 pages long and packed with resort listings and information.