Travel + Leisure Bought $157 Million Of Timeshare Loans Already Showing Credit Damage
Two summer deals added receivables the timeshare company booked with $53 million of initial loss allowance, as its total reserve reached $748 million.
Travel + Leisure, which sells timeshares and runs vacation exchange and travel club memberships, says the customer loans it took on in two third-quarter acquisitions had already deteriorated in credit quality before it bought them. The loans total $157 million, according to the company's quarterly report filed Tuesday.
Allowances on both deals
The 10-Q says the receivables from Spinnaker Resorts and Yes& Vacations had suffered "more-than-insignificant deterioration in credit quality since origination." Spinnaker's receivables carried a $77 million purchase price and a $37 million credit-loss allowance. The Yes& Vacations receivables were bought for $37 million with a $16 million allowance.
That is where the $157 million total comes from, a figure absent from the prior quarter's 10-Q, which came before the closings. Spinnaker closed August 1 and Yes& Vacations July 15.
The allowance for loan losses on contract receivables stood at $748 million at September 30, up from $663 million at December 31, 2025. It includes $53 million of initial allowance on the acquired loans. The nine-month provision was $389 million, against $365 million a year earlier.
The company says it early-adopted new FASB guidance on purchased loans on July 1, 2026, and that adoption had no material impact.
Loans move onto the balance sheet
Gross receivables outside securitizations climbed from $1.02 billion at year-end 2025 to $1.26 billion. Spending on acquisitions, net of cash acquired, reached $290 million for the nine months. The company had $385 million drawn on its revolving credit facility, with $614 million of capacity left.
The company's own earnings release shows Vacation Ownership adjusted EBITDA up 8% to $250 million in the quarter. Travel and Membership adjusted EBITDA fell 12% to $51 million. Management says delinquencies remain above historical levels but have improved each quarter since the first.
At a $4.0 billion market value, the company is leaning on its financing arm while its exchange business shrinks.
Provisional accounting and a 2027 maturity
The acquisition values are preliminary. The 10-Q warns that adjustments during the one-year measurement period could be material to the figures shown.
A $400 million 6.00% secured note comes due in April 2027, and the company says it expects its liquidity to cover the repayment.
The measurement period for the acquisition accounting runs up to a year from each closing, so the $157 million figure can still move.
Sources
- 10-Q Filing — Travel + Leisure Co. (TNL) — SEC EDGAR
- 10-Q Filing — Travel + Leisure Co. (TNL), Q2 FY2026 filed 2026-07-22 (comparison basis) — SEC EDGAR
- Earnings release (8-K Item 2.02, tnl3q26earningsrelease.htm) — Travel + Leisure Co., filed 2026-10-27 — SEC EDGAR
- Compared to Estimates, Travel Leisure Co. (TNL) Q3 Earnings: A Look at Key Metrics — Yahoo Finance
- Travel + Leisure Co. (TNL) Tops Q3 Earnings and Revenue Estimates — Yahoo Finance
- Travel + Leisure Co. CEO Michael Brown on growth strategy - Orlando Business Journal — bizjournals.com
- Travel + Leisure Co. Reports Third Quarter 2026 Results — businesswire.com
