Financing DVC through Disney

[pauly's girl]

I was definitely looking for opinions each way and everyone's experience!! With your figures this year for me will actually almost break even, only because I would be offered the free tickets and it would only cost me $160 to add the rest of our days. I am paying $1100. to stay at POP plus $for tix that money would be my down payment. Next year I will have 2013 and 2014 points to use which I will most likely get a bigger room for my brother and his family to stay, ask him to purchase our tickets In exchange for not having to pay for a room and come out the same next year!! We hope between paying extra and two tax returns that we should be pretty close to paying it off sometime in the 3rd year. I can't say this is what will happen but it sounds like the best plan we can concoct if we choose to go that way...lol Thanks on the well wishes and for all your figures and feedback!!

 

[disneypoor]

Thanks everyone for your input and comments...I have posted on another board and the majority seems to be split on what I should do. I agree I could rent for 10 years but paying 1500 to 2000 a year each year I could also have a direct contract paid for. We are sure that we can afford it starting small and adding points if needed later. Hubby and I talked and are leaning towards feeling more comfortable with a direct purchase. PP you state we don't know how it will be in 20 years but that is a risk with anything we buy. So why not have the flexibility of points in case.... My friend owns a timeshare in Aruba that she paid 17,000 for and it is a set week she must deposit in order to exchange elsewhere for 185$ each time.....I'd much rather have Disney for that !!! We haven't made our minds up and won't until we really sit down and review everything. If the payments are around or under 150. a month we actually could pay double that and save a ton on interest....so we feel confident and comfortable making monthly payments. I appreciate those who are commenting about saving money as I am usually very thrifty when I can be. Under normal circumstances I would be right there with all of you....I'm just not sure I'm comfortable in this situation. Thanks again to everyone and I will be considering all of the replies in our final decision!!

I totally get what you are saying. We listened to a timeshare talk on our very first trip with kids to Disney almost 18 years ago. It was a property that is off site. We really wanted to buy but decided we didn't know if we could afford it, and we really thought it might be a one time trip for us. Boy were we wrong! We have gone at least once every year since then and many times twice. We've also now done 8 Disney cruises with two more booked. My point is, we wish we would have purchased almost 18 years ago but with Disney. By this time, our purchase would have paid for itself and then some, and we'd have many more years to enjoy our DVC.

After that first trip, I started a separate savings account just for vacations. I've had no trouble paying cash for all of our vacations by doing this for 18 years. I just wish I had used that money to buy in to DVC a long time ago even if it did mean I had to have a monthly payment. We ended up vacationing regularly anyway, and I feel like it would have saved us money over the years. Afterall, I was already making a monthly payment to my vacation savings account anyway.

Like you, when we did decide to buy, I also wanted to buy direct. I know I've spent way more money than I would have if I had bought resale, but I like the comfort of knowing that although Disney can change the rules for anyone at any time, I felt like the direct purchases would be the safest route. Plus, we will use our points for cruises. GASP! I know--another thing people don't always agree with. However, we bought our points to use for our vacations, so I don't care how many points it takes as long as it gets us where we want to go. (And, as long as I'm not borrowing from the next year--don't want to get that cycle started!)

I totally understand why people have such strong feelings about buying resale, but I think each person has to make their own decision and do what is best for them or what they feel comfortable with. I don't look at what I could have saved with resale. I look at how much enjoyment my DH and I get with our kids and our extended family as a result of our DVC purchase. Good luck with your decision.

Susan

 

[pauly's girl]

Thanks so much !!!! I agree it has to be an individual decision....just wanted some feedback from others to help us!!! I am looking forward to many years of vacationing also. We thought when we went 10 years ago it would be years before we went back. We do our best to go every other year because we loved it so much! I will let everyone know what our final decision is....stay tuned...lol!!!

 

[ToddyLu]

DH and I purchased 210 at AKL in 2009. With that many points and a referral from another DVC member (promotion at that time) our points direct were $93. It was kinda difficult as I was planning on the cost to find that info. So I have given this info out before.

We purchased direct financing for 10 years at 10.75% interest, Disney's preferred rate at the time. Our monthly notes for that many points is $237 and our monthly MFs are $80 (about $1100 if paid at once). We will have our seventh DVC trip in November. My parents, MIL, BIL have all come along on some of the trips, which has been awesome.

When people say that DVC is a luxury purchase and too expensive to buy direct....I think....yeah and flood insurance wasn't needed when we bought our house...but it was so cheap we bought it in 1998....people laughed...until Katrina. Our Home owners paid NOTHING because it was ALL flood damage...flood insurance gave us $140,000 to rebuild our house. A loss like that without flood insurance would have been devastating and to many it was...we were simply lucky.

While DVC may be expensive not having flood insurance would have been much worse for us. So in everyone's case the need or want is different.

You know your financial situation better than anyone...and your travel habits

With the above monthly note we have enjoyed every second with DVC. It has completely changed the way we visit Disney. We are more apt to stay around the resort now or at least do not mind returning. It is a more relaxing visit. We buy few souvenirs but do purchase APs that we try to get two trips a year at least on.... so add to your cost those hidden perks or negatives. So while Disney trips are more expensive now than staying value, we do enjoy them more.

 

[ELMC]

DH and I purchased 210 at AKL in 2009. With that many points and a referral from another DVC member (promotion at that time) our points direct were $93. It was kinda difficult as I was planning on the cost to find that info. So I have given this info out before.

We purchased direct financing for 10 years at 10.75% interest, Disney's preferred rate at the time. Our monthly notes for that many points is $237 and our monthly MFs are $80 (about $1100 if paid at once). We will have our seventh DVC trip in November. My parents, MIL, BIL have all come along on some of the trips, which has been awesome.

When people say that DVC is a luxury purchase and too expensive to buy direct....I think....yeah and flood insurance wasn't needed when we bought our house...but it was so cheap we bought it in 1998....people laughed...until Katrina. Our Home owners paid NOTHING because it was ALL flood damage...flood insurance gave us $140,000 to rebuild our house. A loss like that without flood insurance would have been devastating and to many it was...we were simply lucky.

While DVC may be expensive not having flood insurance would have been much worse for us. So in everyone's case the need or want is different.

You know your financial situation better than anyone...and your travel habits

With the above monthly note we have enjoyed every second with DVC. It has completely changed the way we visit Disney. We are more apt to stay around the resort now or at least do not mind returning. It is a more relaxing visit. We buy few souvenirs but do purchase APs that we try to get two trips a year at least on.... so add to your cost those hidden perks or negatives. So while Disney trips are more expensive now than staying value, we do enjoy them more.

I have to say that you completely lost me with the whole flood insurance analogy. I don't really see the connection there.

Regardless, I was wondering. $93pp for a brand new resort that isn't available on the resale market is a pretty good deal. Would you do the same thing now, in today's market, and purchase AKV direct at $145 a point when it is easily available on the resale market for $60 per point?

 

[Dean]

DH and I purchased 210 at AKL in 2009. With that many points and a referral from another DVC member (promotion at that time) our points direct were $93. It was kinda difficult as I was planning on the cost to find that info. So I have given this info out before.

We purchased direct financing for 10 years at 10.75% interest, Disney's preferred rate at the time. Our monthly notes for that many points is $237 and our monthly MFs are $80 (about $1100 if paid at once). We will have our seventh DVC trip in November. My parents, MIL, BIL have all come along on some of the trips, which has been awesome.

When people say that DVC is a luxury purchase and too expensive to buy direct....I think....yeah and flood insurance wasn't needed when we bought our house...but it was so cheap we bought it in 1998....people laughed...until Katrina. Our Home owners paid NOTHING because it was ALL flood damage...flood insurance gave us $140,000 to rebuild our house. A loss like that without flood insurance would have been devastating and to many it was...we were simply lucky.

While DVC may be expensive not having flood insurance would have been much worse for us. So in everyone's case the need or want is different.

You know your financial situation better than anyone...and your travel habits

With the above monthly note we have enjoyed every second with DVC. It has completely changed the way we visit Disney. We are more apt to stay around the resort now or at least do not mind returning. It is a more relaxing visit. We buy few souvenirs but do purchase APs that we try to get two trips a year at least on.... so add to your cost those hidden perks or negatives. So while Disney trips are more expensive now than staying value, we do enjoy them more.

If your point is don't be penny wise and pound foolish, I agree but don't see how that applies to DVC, esp to retail. There are a few situations where it is reasonable to consider retail given the current situations of each. These would include small purchases and a resort that's in demand and not available resale. It would not include gaining the developer options not available resale or in order to finance and would not generally include the ability to get the next trip covered when it's too short notice to do so resale. I get that some can't seem to delay gratification even if they can't afford something but I see that as an admission of a problem, not even as an excuse to overextend themselves much less a valid reason to do so. To me it's simply a poor choice to finance vacations or luxury purchases, that makes financing DVC a double Whammy.

 

[DisneyDiana]

DH and I purchased 210 at AKL in 2009. With that many points and a referral from another DVC member (promotion at that time) our points direct were $93. It was kinda difficult as I was planning on the cost to find that info. So I have given this info out before.

We purchased direct financing for 10 years at 10.75% interest, Disney's preferred rate at the time. Our monthly notes for that many points is $237 and our monthly MFs are $80 (about $1100 if paid at once). We will have our seventh DVC trip in November. My parents, MIL, BIL have all come along on some of the trips, which has been awesome.

When people say that DVC is a luxury purchase and too expensive to buy direct....I think....yeah and flood insurance wasn't needed when we bought our house...but it was so cheap we bought it in 1998....people laughed...until Katrina. Our Home owners paid NOTHING because it was ALL flood damage...flood insurance gave us $140,000 to rebuild our house. A loss like that without flood insurance would have been devastating and to many it was...we were simply lucky.

While DVC may be expensive not having flood insurance would have been much worse for us. So in everyone's case the need or want is different.

You know your financial situation better than anyone...and your travel habits

With the above monthly note we have enjoyed every second with DVC. It has completely changed the way we visit Disney. We are more apt to stay around the resort now or at least do not mind returning. It is a more relaxing visit. We buy few souvenirs but do purchase APs that we try to get two trips a year at least on.... so add to your cost those hidden perks or negatives. So while Disney trips are more expensive now than staying value, we do enjoy them more.

First, I understand how it feels to have your home flooded. We live on an island across from the bay. I'm glad you recovered from Katrina. We lost the first floor of our home this fall to Sandy. This is why I am confused about your comparison with DVC and flood insurance. I see flood insurance as an absolute necessity not a luxury. My home is the biggest investment/purchase I'll ever make. Not to have it insured for flood would be incredibly stupid and irresponsible. The same could not be said for not having DVC. There would be no life altering expenses or catastrophes without Dvc.

 

[cfw213]

I haven't read this whole post, but you can fjnance a resale purchase! We bought 160 SSR points through Fidelity and financed through Timesharelending.com. The approval process was kind of a headache but we got it done.

Also, we bought a purchase with a ton of banked points that we rented out for almost $3,000. We turned around and paid off a huge portion of our loan and now well be paid of by the end of this year. Well have it done in 18 months as compared the 5 years the term of the loan is for. Doing it this way we got resale prices AND only paid about $1500 in interest. Definitely something to think about!

Feel free to send me a PM if you want more specifics

 

[ELMC]

I haven't read this whole post, but you can fjnance a resale purchase! We bought 160 SSR points through Fidelity and financed through Timesharelending.com. The approval process was kind of a headache but we got it done.

Also, we bought a purchase with a ton of banked points that we rented out for almost $3,000. We turned around and paid off a huge portion of our loan and now well be paid of by the end of this year. Well have it done in 18 months as compared the 5 years the term of the loan is for. Doing it this way we got resale prices AND only paid about $1500 in interest. Definitely something to think about!

Feel free to send me a PM if you want more specifics

This is a very good point. I think we could all benefit from learning a little more about financing resale, so whatever information you can share (without getting into specifics) would be helpful and appreciated.

 

[ANGRebel]

This is a very good point. I think we could all benefit from learning a little more about financing resale, so whatever information you can share (without getting into specifics) would be helpful and appreciated.

We needed just a couple thousand for our purchase, and I just took out a signature loan from my credit union. We don't have any other debt but our house so we'll have this paid off in just a few months and the rate was better than any of the timeshare financing options I've heard of with the possible exception of a home equity loan.

I wasn't too keen on borrowing anything for a timeshare purchase, but I "got the fever" and decided to go ahead and buy about 4-5 months before I had enough saved. It wasn't a big loan though so it didn't bother me too bad.

Sent from my iPhone using DISBoards

 

[Lizzim]

If your point is don't be penny wise and pound foolish, I agree but don't see how that applies to DVC, esp to retail. There are a few situations where it is reasonable to consider retail given the current situations of each. These would include small purchases and a resort that's in demand and not available resale. It would not include gaining the developer options not available resale or in order to finance and would not generally include the ability to get the next trip covered when it's too short notice to do so resale. I get that some can't seem to delay gratification even if they can't afford something but I see that as an admission of a problem, not even as an excuse to overextend themselves much less a valid reason to do so. To me it's simply a poor choice to finance vacations or luxury purchases, that makes financing DVC a double Whammy.

I know that generally your advice is sound but there is an alternative view on this.

I know many people who saved up for years for things.....especially in preparation for retirement for example....and then were unable to enjoy them due to ill health or early unexpected deaths

I financed my direct DVC contract but I have been enjoying it for 3 years now and will always have the memories.....saving and being prudent wouldn't necessarily get me that

As long as you can comfortably afford the payments and the dues then the money isn't necessarily the most important factor. (I'm an accountant by the way!)

 

[z28wiz]

I know that generally your advice is sound but there is an alternative view on this.

I know many people who saved up for years for things.....especially in preparation for retirement for example....and then were unable to enjoy them due to ill health or early unexpected deaths

I financed my direct DVC contract but I have been enjoying it for 3 years now and will always have the memories.....saving and being prudent wouldn't necessarily get me that

As long as you can comfortably afford the payments and the dues then the money isn't necessarily the most important factor. (I'm an accountant by the way!)

Excellent!! Tomorrow is not guaranteed. Memories are forever!

 

[ToddyLu]

My previous connection to the hurricane experience was only that we all make choices which affect our lives...some choices are better than others and you just never know what changes can happen. When someone is considering spending so much upfront it is important to consider all aspects. DVC is a lot of cost upfront with the payout being how you travel and how the ownership changes your experience at Disney. Insurance is generally a lower upfront cost that can have a big payout

Wish I would have known more about resale and didn't. Glad I knew about flood insurance and bought it...in our area you didn't need to own it to purchase a home in our neighborhood, basically no one did...we live 2 miles inland. Just thinking about life changing expenses is all...I consider our purchase of DVC and insurance as two of those.

coulda, woulda, shoulda...

 

[Dean]

I know that generally your advice is sound but there is an alternative view on this.

I know many people who saved up for years for things.....especially in preparation for retirement for example....and then were unable to enjoy them due to ill health or early unexpected deaths

I financed my direct DVC contract but I have been enjoying it for 3 years now and will always have the memories.....saving and being prudent wouldn't necessarily get me that

As long as you can comfortably afford the payments and the dues then the money isn't necessarily the most important factor. (I'm an accountant by the way!)

To me it's not as much of an issue of the interest as it is the risk. It's far more about managing risk than it is the interest or payments. While there are people who have financed, enjoyed and payed off their DVC as they were paying other debts as well, there are also those who have had significant financial issues for any number of reasons and have had significant consequences including bankruptcy and loss of possessions. If anyone "saved for years" for DVC and still couldn't buy, I'd think they truly couldn't afford it anyway or it wasn't a priority enough for them to put the effort into it.

I do realize there are special situations and that everyone's circumstance is different. Each must make their own decision. I'm not upset with anyone that decides to finance but I would rather them not buy that way than add the risk to their life, even if it means they never buy into DVC. Remember that there are more people looking at these type of decisions than just those posting. If I get them to think about their situation and possibly make a better decision than they would have otherwise, that's my goal.

Excellent!! Tomorrow is not guaranteed. Memories are forever!

I think it's living for tomorrow that's caused most, if not all, of our current financial issues in this county. I discount the idea that one has to buy DVC to have great memories.

 

[z28wiz]

To me it's not as much of an issue of the interest as it is the risk. It's far more about managing risk than it is the interest or payments. While there are people who have financed, enjoyed and payed off their DVC as they were paying other debts as well, there are also those who have had significant financial issues for any number of reasons and have had significant consequences including bankruptcy and loss of possessions. If anyone "saved for years" for DVC and still couldn't buy, I'd think they truly couldn't afford it anyway or it wasn't a priority enough for them to put the effort into it.

I do realize there are special situations and that everyone's circumstance is different. Each must make their own decision. I'm not upset with anyone that decides to finance but I would rather them not buy that way than add the risk to their life, even if it means they never buy into DVC. Remember that there are more people looking at these type of decisions than just those posting. If I get them to think about their situation and possibly make a better decision than they would have otherwise, that's my goal.

I think it's living for tomorrow that's caused most, if not all, of our current financial issues in this county. I discount the idea that one has to buy DVC to have great memories.

The memories comment was a blanket term. I was just stating memories last forever, regardless of how you go about making them.

Regarding financing its pretty much up to the individual person and what they want to do. Everyone lives and leads different lives.

 

[Dean]

The memories comment was a blanket term. I was just stating memories last forever, regardless of how you go about making them.

Regarding financing its pretty much up to the individual person and what they want to do. Everyone lives and leads different lives.

No argument though I'd add that both good and bad memories fall into that category and the latter certainly applies to some situations where people either over extended themselves or life happened to them.

 

[Missyrose]

I know that generally your advice is sound but there is an alternative view on this.

I know many people who saved up for years for things.....especially in preparation for retirement for example....and then were unable to enjoy them due to ill health or early unexpected deaths

I financed my direct DVC contract but I have been enjoying it for 3 years now and will always have the memories.....saving and being prudent wouldn't necessarily get me that

As long as you can comfortably afford the payments and the dues then the money isn't necessarily the most important factor. (I'm an accountant by the way!)

It's fantastic that you're enjoying your DVC contract so much. It's also great that the monthly payment and dues aren't an issue for you. But what if you lost your job or there was some kind of prolonged illness and you couldn't pay your dues or your monthly payment? For people with direct contracts who paid cash, they can sell their contract and get about half their money back. But with financed contracts, you'd have to be able to pay off the loan when you sold, which often means bringing money to the table. If you couldn't afford to do that, you'd just have to give your contract back to Disney and never again see a dime of the money you paid.

Just a thought to keep in mind as people make their decisions.

 

[ELMC]

My previous connection to the hurricane experience was only that we all make choices which affect our lives...some choices are better than others and you just never know what changes can happen. When someone is considering spending so much upfront it is important to consider all aspects. DVC is a lot of cost upfront with the payout being how you travel and how the ownership changes your experience at Disney. Insurance is generally a lower upfront cost that can have a big payout

Wish I would have known more about resale and didn't. Glad I knew about flood insurance and bought it...in our area you didn't need to own it to purchase a home in our neighborhood, basically no one did...we live 2 miles inland. Just thinking about life changing expenses is all...I consider our purchase of DVC and insurance as two of those.

coulda, woulda, shoulda...

Regardless, I was wondering. $93pp for a brand new resort that isn't available on the resale market is a pretty good deal. Would you do the same thing now, in today's market, and purchase AKV direct at $145 a point when it is easily available on the resale market for $60 per point?

Thanks for the explanation. I'm still wondering what your position would be about a direct purchase now, at close to $60 more per point.

 

[ELMC]

If your point is don't be penny wise and pound foolish, I agree but don't see how that applies to DVC, esp to retail. There are a few situations where it is reasonable to consider retail given the current situations of each. These would include small purchases and a resort that's in demand and not available resale. It would not include gaining the developer options not available resale or in order to finance and would not generally include the ability to get the next trip covered when it's too short notice to do so resale. I get that some can't seem to delay gratification even if they can't afford something but I see that as an admission of a problem, not even as an excuse to overextend themselves much less a valid reason to do so. To me it's simply a poor choice to finance vacations or luxury purchases, that makes financing DVC a double Whammy.

I know that generally your advice is sound but there is an alternative view on this.

I know many people who saved up for years for things.....especially in preparation for retirement for example....and then were unable to enjoy them due to ill health or early unexpected deaths

I financed my direct DVC contract but I have been enjoying it for 3 years now and will always have the memories.....saving and being prudent wouldn't necessarily get me that

As long as you can comfortably afford the payments and the dues then the money isn't necessarily the most important factor. (I'm an accountant by the way!)

I don't discount the fact that there is an alternate view to Dean's opinion (which I happen to share). But I have a hard time adopting your "live for the moment" philosophy, especially when it involves fiscal irresponsibility in the short term and there are many alternative options that have much less risk. I can see how you would say that it is important to vacation now. Maybe your kids are young and you want to embrace that. Maybe you have a stressful life and a week away will help. So I agree with you to a point, that one could save 10 years for a Disney vacation and by the time they go their kids are too old or maybe they dropped dead or whatever. But I do not believe that theory applies to DVC. We hear this all the time, where people speak of DVC as if they could not visit Disney otherwise. There are hundreds of different ways to visit Disney on the cheap. DTD hotels are less than $100 a night. Values are less than $100 a night. Moderates are not much more. Offsite timeshares can be had on eBay for $1 or you can simply book a week direct at discount prices. All of these solutions are less than the tens of thousands needed to buy in to DVC and they come without the long term commitment and risk associated with a direct financed purchase. So I'm sorry, but I'm not buying the argument that you have to have DVC or else you won't be able to go to Disney. I think it's a justification and a poor one at that.

Buying and financing DVC when you don't have the money is not a "live life now" type of decision. In my opinion it is an extremely risky decision with long term detrimental effects. Now please don't read too much into this...I am talking about the decision and not the people who make it, so I'm not saying anything about people personally. I simply believe it is a bad choice. Everyone has something they want but can't afford. For some it's a nicer car. For some it's a bigger house. I think that accepting that something is out of one's price range is a much more productive strategy than going into incredible and risky debt to obtain what is out of reach. I get that this is an unpopular position, and please feel free to disagree.

The memories comment was a blanket term. I was just stating memories last forever, regardless of how you go about making them.

Regarding financing its pretty much up to the individual person and what they want to do. Everyone lives and leads different lives.

Very true. And if there's one thing living in America for the past number of decades has taught us, it's that we are free to make our own decisions, no matter how bad they are or how detrimental the consequences. But that doesn't mean we should.

Think about it this way...if you commit to 10 years of debt for a DVC purchase, that is 10 more years until you are debt free.

 

[montrealdisneylovers]

It's fantastic that you're enjoying your DVC contract so much. It's also great that the monthly payment and dues aren't an issue for you. But what if you lost your job or there was some kind of prolonged illness and you couldn't pay your dues or your monthly payment? For people with direct contracts who paid cash, they can sell their contract and get about half their money back. But with financed contracts, you'd have to be able to pay off the loan when you sold, which often means bringing money to the table. If you couldn't afford to do that, you'd just have to give your contract back to Disney and never again see a dime of the money you paid.Just a thought to keep in mind as people make their decisions.

Depending how soon after purchase your job loss or illness happens, the bolded part may actually be more advantageous than the underlined part.