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Goofyzgurl
02-13-2002, 10:16 PM
DH and I were trying to decide between a resale or the new BVC. One of the questions we had were what kind of financing was there if we bought through a resale. We don't own a home, military, so we don't have the option of adding it to our house payments. Would it be a regular signature loan or some other loan and what kind of rate would go with the loan?

When I called the bank to ask about financing a timeshare, the lady kept telling me that the the "primeshare" was at a 6.5%, I kept telling her that I was thinking about a timeshare....Then she said that I could borrow against my savings, using that as collateral. I bit my tongue though and didn't tell her that if I had 12K in my savings I wouldn't need a loan. :smooth:

Disney financing is looking pretty good and simple about now. Just when I got the jist of a point system, this pops up. :)

Firefighter Mickey
02-13-2002, 10:39 PM
I'd be really surprised if you could find a resale for BCV yet - I suppose it could happen, but I'd be surprised.

Some of the resale companies can help you with financing, but it's usually just considered an unsecured loan. There are no tax advantages to go along with these types of loans, and the rates (in my opinion) are usually fairly high in comparison to most home equity loans available.

I would compare what interest rate DVC can provide with what your bank (or resale bank) or CU can provide for an unsecured loan, and make the choice based on that (especially since a home equity loan is not an option for you at this point).

EROS
02-13-2002, 11:52 PM
I'm a BIG proponent of resale primarily to help save folks MONEY. However, IF you need financing and/or are unable to use a home equity loan, I think that DVD purchase is an easier way to go.

WorknFires
02-14-2002, 12:25 AM
I'm having the same problem except I own a home. I want to buy a resale instead of BCV. I went to several banks and mortgage offices today and basically here's what was told to us:

Mortgage companies don't handle timeshares because of Federal guidelines (Fannie Mae)

Regular Bank wants to do a home equity line (which we can't do because we refinanced last month with money back to pay off bills) and a variable rate... by the way the prime today was 4.9%

or

a second mortgage w/ fixed rate of about 9%

or a unsecured loan (why they call it that when they want to secure it with a lien against my vehicle I don't know) with a fixed 15% rate.

I got the usual "look" when I mentioned timeshare and had to spend a half hour explaining why DVC was different. I swear the loan manager was going to get on the phone w/ DVC for his own purchase when we were going out the door (empty handed because none of these options appealed to me)

So for me at least it's back to the usual... hoping I win the lottery! :D Good Luck and let me know what you come up with.

Cheryl :bounce:

sgtpet
02-14-2002, 07:28 AM
Instead of a home equity loan why not use a line of credit account on your home.

Firefighter Mickey
02-14-2002, 08:35 AM
A revolving line of credit secured by your home, is a home equity loan - it's just wearing a different coat.

I guess I wouldn't really call an auto loan unsecured, but a bank might because the asset is not really fixed; but I'm not sure.

If you are really after a resale, the timeshare store I believe can help you secure financing - I seem to recall that they made arrnagements to work with a financial institution that understands what timeshare is. It's still an unsecured loan, and the rates might not be the greatest, but I'll bet they've got to be better than 15% (maybe not much better, but 15% seems really high to me).

JillU-DVC
02-14-2002, 11:44 AM
I purchased an OKW resale through The Timeshare Store 2 years ago (was it really that long ago??).

I didn't own a home, and had no local sources of financing (the banks I talked to wouldn't even discuss an unsecured loan of that size with me; most had a $5000 to $7000 max for unsecured loans).

I used the financing company that was provided by the TimeShare Store - my loan is currently being handled by Tammac Financial (can't remember if that's who initiated the loan or not).

Filling out the paperwork was pretty easy, and approval came very quickly (I was worried about past credit history, but it must not have been a problem).

Interest rate was higher than offered by Disney; unfortunately, I can't remember the interest rate right now (was probably between 13% and 14%). Anyone who sells DVC (TimeShare Store or the other place whose name I never remember) could tell you what the current financing rate is with their loan provider.

So, buy where you want to stay, and if that means a resale, then go for it!

mic_KY_mouses
02-14-2002, 12:56 PM
Having worked in banking 23 years I thought I'd throw out a couple more ideas to you.

If you have a certificate of deposit (or a relative has one) to pledge it can be used to secure a loan which usually has an interest rate just a couple percentage points higher than the CD is earning (or certainly lower than the 15% you're being quoted). Banks like it because of the low risk of principal loss.

If you have a credit card that has a decent rate you could use it as many of them have line allowances of up to 20k. I don't suggest this though unless you can really stay on top of matters, work out a repayment schedule to pay off the card and stick with it. You do have interest-rate risk with this option.

Disney might be your best choice though..... Good luck!

WorknFires
02-14-2002, 03:21 PM
My dad said NO he doesn't understand (or care) about DVC all he can focus on is timeshare.

I spoke to the people at the time share store, I think the company they recommend is about 11% which is really good but the TS store said you better have A+ credit so I don't know if this is the same company you've got JillU-DVC or not. I've always had good credit but my mom filed for bankruptsy on a credit card that I was a user for when I was a minor. We've sent all kinds of documentation to the credit card co proving I was a minor at the time and that I was only a user (couldn't have been joint and a minor anyway) but occassionally it resurfaces (not all the time which doesn't make a lot of sense) so I didn't want to take that chance. But since it's starting to look like my only option, I may try it.

Thanks for all your help,
Cheryl

Goofyzgurl
02-14-2002, 07:08 PM
I guess I'll be buying the lotto ticket this weekend, Cheryl. Until I win I guess I'll be financing with DVC. :)

doubletrouble_vb
02-14-2002, 08:20 PM
When I was looking I found that at the time the DVC rate (no MB) and the Tammac rate combined with slightly lower price per point for resale worked out to be the same after you factored in all the real estate fees. However that's when resale prices were at their peak. Resales are significantly lower now and DVC is higher so if I were buying now I'd go resale. At the very least ask how much are the fees will be from The Timeshare Store (Disney kicks most of these in for free). Ask what the interest rate will be from each then run the numbers. You may decide that paying Disney an extra $1,000 is worth it just to say the small headache of going through the resale process.

Search the web you can find Tammac out there or call the Timeshare Store. Talk to them...you may find you are a good candidate. I think the rate last May was something like 13.9. It wouldn't surprise me if their rates had gone down to 11.9%.

WorknFires
02-14-2002, 11:24 PM
I'm off work tomorrow, I think I'll do that. I've been waiting for BCV to open but now that it has all I seem to want to buy is more OKW. Oh well.

Good luck Goofyzgurl, maybe Saturday will see all our dreams come true! ;)

Thanks everyone, I'll let you know what I find out.

Cheryl

JillU-DVC
02-15-2002, 06:55 AM
Cheryl

I'm sure that the Timeshare Store rate you were quoted was teh same as the company I got financing through; my guess is that they will still approve you, but if the credit card thing shows up you may be quoted a higher interest rate than they have going now (which I think you said was 11%).

You might want to apply and see what kind of rate you get, and then you can decide if that's acceptable for you.

Also, maybe you have already done this, but I thought I would mention that if the credit card thing shows up in your credit rating (you should get a copy of your credit report from all three credit places), you can always work with the credit report people to either get it removed, or (if they won't remove it) add a letter of explanation about what happened; creditors would see that letter and know exactly what happened.

By the way, my father thought the same thing about timeshares; I think I almost have him convinced it's a GREAT thing (after 2 years!), but I'm sending him and Mom down for a 1 week trip in July this year, and after that, I'm SURE he'll be convinced!!

WorknFires
02-23-2002, 09:31 AM
Thank you doubletrouble_vb, I found tammac.com and did the over the internet application for financing. Since they were closed monday and I ended up having to fax them a copy of our W-2's, we found out yesterday that we did qualify for the loan at the 11.5% rate.

I've been eyeballing 2 identical resales, one thru the timeshare store and another thru DVC resales and the DVC resales was $660 cheaper. BUT... I really wanted to go thru the timeshare store since they sponsor the DIS (and I love it thanks to you great folks!) so the timeshare store contacted their seller and they agreed to match the other price.

So thank you all for your great advice and patience with me. It looks like it's all going to work out. So I'll keep my fingers crossed for you Goofyzgurl.

On a side note to JillU-DVC... how many years did you end up financing for?

Thanks again,
Cheryl :bounce:

ducklite
02-23-2002, 01:29 PM
Originally posted by WorknFires
[B]I'm having the same problem except I own a home. I want to buy a resale instead of BCV. I went to several banks and mortgage offices today and basically here's what was told to us:

Mortgage companies don't handle timeshares because of Federal guidelines (Fannie Mae)

Not exactly. Fannie Mae is NOT a Federal Agency, they are a publicly-owned corporation, just like Microsoft or GE. They are also not the only agency that does what they do, Freddie Mac being one of the most notable others. They buy mortgages from lenders on the secondary market (that's how banks don't run out of money to lend!), using funds from a variety of investors who in exchange for their investment get a guaranteed rate of return and security interest in real property. You are correct though, Fannie Mae (and other secondary lenders) guidelines exclude loans for time share property.

There are several options which can be persued other than a real property loan. If you have savings, many institutions will make a loan as long as you put yout savings account up as collateral. it does in effect freeze your money for the length of the loan, however you will still continue to receive interest payments on it that will also help to offset the interest paid on the loan. If you have a paid for car, boat, RV or other collateral, you can often put that up against the loan.

If you have superb credit, a stable employment history, some savings, and the loan isn't going to be a stretch to make monthly payments on, some banks and CU's will give you a signature loan for fairly substantial amounts.

Anne

WorknFires
02-23-2002, 02:45 PM
The mortgage officer stated they don't handle timeshare resales because of federal guideline. Somehow fannie mae was mentioned in the conversation to which I had quit listening because she wasn't telling me what I wanted to hear (i.e. I could have the $$$) and I didn't care anymore.

Making the payment has never been a problem, DH & I both are at the top of our respective fields and have been employeed with our companies for nearly 15 years. The problem was that we've put all our savings into our retirements and I wasn't willing to take a loan against them.

But all is resolved as you can see by my last post.

Cheryl

JillU-DVC
02-25-2002, 10:46 AM
On a side note to JillU-DVC... how many years did you end up financing for?

I ended up financing for 5 years - hope to pay it off sooner, since I'm sending in extra every month. Only time will tell!

CarolA
02-25-2002, 11:49 AM
I used Tammac and found them easy to deal with. I did wind up paying mine off early and that went great. Be sure to check on early pay off if you go with some other place. I actually had a car dealer try to get me to accept a loan that had an early payoff penalty one time so I have always checked that since then.

WorknFires
02-26-2002, 07:29 AM
Me too. Just checking..... ;)

Thanks ya'll,
Cheryl

ZerasPride
02-26-2002, 09:19 AM
Can someone tell me (and excuse me if this question has been asked one thousand times) if you can write off the interest portion of a loan if you purchase resale the way you can with a direct buy purchase from Disney? Thanks! If so, maybe a BWV resale is in our future instead of a BCV add on.

Lisa

WorknFires
03-01-2002, 09:50 AM
I think you can (I had certainly planned on it!) but let's ask those that have gone before us....

CarolA, JillU-DVC did you claim the interest on your financing on your taxes each year?

Bumping up for the answer,
Cheryl

crisi
03-01-2002, 10:22 AM
And the official answer is.....maybe! Gotta love the IRS:

http://www.irs.gov/formspubs/display/0,,i1%3D50%26genericId%3D12831,00.html

talk to a tax attorney or an accountant.

WorknFires
03-01-2002, 10:46 AM
Whew! Boy was that all greek to me! LOL yes, I'll definately have to talk to a tax attorney. I wouldn't want to get it wrong. I guess the biggest question is whether my new loan is secured against the resale or if it offers a lien against my general assets if I should default. If it's the 1st, it would qualify for the tax deductions and if it were the 2nd, it would not.

Thanks crisi (and welcome to the DIS :D )
Cheryl

crisi
03-01-2002, 12:55 PM
The other thing I noticed was you had to spend time there during the tax year. Which means that if you bank all your points for that year - intending a big trip next year, you can't deduct interest that year.

(I also think that if the loan is against your primary residence (i.e. a home equity loan) you are in the clear, but I'm not an attorney or an accountant)