DVC Tranished Image

[marynvince]

For every person with the means and intent to pay their obligations, there is another that overextends and can not meet their obligations. Without further documentation, Disney doesn't know which side to put you on. I applaud their caution and if you want the points enough, why not provide additional proof of financial responsibility?

 

[ssawka]

3) So according to some of you, if you make a mistake in 12 years, you forever banished

As others have stated, it is not "forever", just one year. Did they offer to finance at the higher rate, or are they not doing that anymore?

As for Disney's policy, lending is all about risk and return. Like in or not, by you missing a payment you are now a higher risk to them. You say you have not missed a payment in 12 years, and that is great, but how do they know that you are not starting to have financial difficulties now? They only way they can determine that is to look at the financial records they have requested.

This is something that drives me crazy lately. Money is so unbelievably cheap right now i don't know how anyone would pay 11% for a luxury purchase such as DVC. I am not saying you should have the money to buy outright but geez, if you want to own DVC i think you should be able to find financing through your own, bank, credit union, pension loan...somewhere, anywhere that is lower than 11%......End of financial rant!

There are a lot of factors to consider when financing. At face value, you are correct that 11% is high, but there are a number of reasons why Disney financing may be appealing to some:

1. It's easy!
2. If you only own one home, then the interest may be tax deductible. Depending on your tax bracket, that will make your effective rate much lower, like 7%-8%.
3. It's relatively low risk, since the collateral on the loan is just the points, not some other asset, like your home.
4. With the dampened real estate market, people may not have enough equity in their homes to qualify for a HELOC or a HEL.

I would not use Disney financing over a long period, but for a year or two it might be appealing.

2. do you own a home? why not a small heloc or home equity loan, that is surely a write off.

See #4 above.

Luxury vs. necessity. A luxury is anything not essential to your everyday life. Food, shelter and clothing are necessities. iPods, TVs, timeshares and vacations are luxuries, regardless of the cost. A $2 pack of gum is a luxury purchase...but you don't go into debt to buy a pack of gum.

It depends on what you consider "go[ing] into debt". Many people buy small items like a pack of gum using a credit card. In fact, some vending machines now take credit cards. We personally put almost everything on our credit card to get the rewards, however we also know that we already have the cash to pay the bill at the end of the month and that we will not incur interest charges.

Generally speaking it is not wise to go into debt for any luxury purchase. Consumers often justify the debt as long as they can handle the payments. If you CAN handle the payments, save a little longer and just pay cash.

Normally, I would agree with you, but not if you are really determined to buy DVC. With the way Disney keeps increasing the price, it may actually cost you more if you wait. Is waiting safer? absolutely! No one can deny that, but it may not be the cheapest route. This happened to us when we bought. We bought BLT in 2009 @ $92 a point. We paid off the loan a year later. By then the price had risen 22%.

Disney prison can't be too bad -- you've got pirates and princesses and Stitch to keep you company.

...and you would be able to escape easily, if you could just get that darn dog to bring you the key!

 

[tjkraz]

Normally, I would agree with you, but not if you are really determined to buy DVC. With the way Disney keeps increasing the price, it may actually cost you more if you wait. Is waiting safer? absolutely! No one can deny that, but it may not be the cheapest route. This happened to us when we bought. We bought BLT in 2009 @ $92 a point. We paid off the loan a year later. By then the price had risen 22%.

Two years ago I would have agreed.

Today with the growing disparity between resale and direct, I would have to see the numbers to believe it.

Buying AKV direct will cost around $120 per point...$200 per point if adding the interest paid on a 10-year loan. Resale is $65 - 70 per point. The ability to book non-DVC destinations on points has SOME value but no rational person would pay such a premium for that right. And like I said, I'd have to see the numbers to believe that paying so much more direct is a better deal than saving for a couple of years and buying resale.

 

[disneynutz]

It would be easy for DVD to let buyers get themselves into credit trouble and then reap the rewards of foreclosing and reselling the contracts.

Sub-prime loans did a number on the housing market and on many families, I have to give Disney credit for sticking to their policies.

To the OP, you might be upset with Disney now, but in the long run you might be thanking them.

Bill

 

[Missyrose]

If you already have 700 points, why is there such a rush to buy more? Bank and borrow from your current point totals and make what would be your new Disney loan payments into a savings account and then just buy the new points with cash once you've saved enough?

I understand the urge to add on, but if you had issues with your finances a few months ago, why not give yourself some extra time to make sure all that is behind you before jumping head first into even more debt?

 

[Mick West]

I agree with you, Mr poster. To all of you "Disney is a business", "I side with Disney", "financing a luxury.." Say what??? And the one I really like, "It's not one mistake in 12 years, it's one in the last year." WOW - how deep!! It's these kinds of thoughts and attitudes that are in the narrow minds of the ones making this decision. This is on the order of kicking the 5 year old out of kindergarten because his Mom left a plastic knife in his school lunch bag! The schools response; zero tolerance. Common sense and not being afraid to make a decision is truly becoming extinct.

 

[bwvBound]

To all of you "Disney is a business", "I side with Disney", "financing a luxury.." Say what??? And the one I really like, "It's not one mistake in 12 years, it's one in the last year." WOW - how deep!! It's these kinds of thoughts and attitudes that are in the narrow minds of the ones making this decision. This is on the order of kicking the 5 year old out of kindergarten because his Mom left a plastic knife in his school lunch bag! The schools response; zero tolerance. Common sense and not being afraid to make a decision is truly becoming extinct.

Just checking for understanding: the 1-yr window is more favorable (generous) to the DVC consumer than a 12-year window. It is a very brief "timeout" compared to the more widely accepted 7-year timeout in larger finance circles.

 

[ssawka]

Two years ago I would have agreed.

Today with the growing disparity between resale and direct, I would have to see the numbers to believe it.

Buying AKV direct will cost around $120 per point...$200 per point if adding the interest paid on a 10-year loan. Resale is $65 - 70 per point. The ability to book non-DVC destinations on points has SOME value but no rational person would pay such a premium for that right. And like I said, I'd have to see the numbers to believe that paying so much more direct is a better deal than saving for a couple of years and buying resale.

Yes, I agree if you are talking about resale versus direct. I was simply referring to financing direct versus paying cash direct. I recently received the mailing saying that BLT was going up to $160pp!

 

[rigsby25]

My advice in life is "at least pay the minimum by the due date".

 

[thedon3]

I must admit some of the replies were amazing. Thanks Mick West. Anyway, to clear up a couple of things.
1) I also own Disney Stock
2) Since my last 2 contracts are over in 2 months adding another was no big deal
3) Adding more points was for my familty because they all enjoy Disney world
4) I missed jan. payment, due to an unforseen issue - I use to have auto checking, so when I switched banks DVC kept double debting me, so I pay it myself.
5) DVC is nothing more then a well established Time share program not the Ritz
6) The banished forever comment was sarcastic.
7) Some of you think I am asking for a bail out - not
8) Time to remeber we all make mistakes
9) I am just a middle class family man who enjoys his family and country
10) It is what it is
11) Great discussions
12 Safe Weekend to All

Thanks

 

[KAT4DISNEY]

I agree with you, Mr poster. To all of you "Disney is a business", "I side with Disney", "financing a luxury.." Say what??? And the one I really like, "It's not one mistake in 12 years, it's one in the last year." WOW - how deep!! It's these kinds of thoughts and attitudes that are in the narrow minds of the ones making this decision. This is on the order of kicking the 5 year old out of kindergarten because his Mom left a plastic knife in his school lunch bag! The schools response; zero tolerance. Common sense and not being afraid to make a decision is truly becoming extinct.

This was not zero tolerance. Disney asked for additional financial documentation. The OP chose not to do that. For most loans you have to provide some financial documentation even when you've never had a problem. Disney was an exception for a long time and got bit by it and apparently is now tightening up their policies.

 

[jennypenny]

I have a little more sympathy for the OP than a lot of you I guess. Have any of you tried to get a loan outside of Disney lately? We have a mortgage on our home, and when I inquired with our bank about buying vacation property (with 30% down) they stated they were not doing second home mortgages unless the residence was paid in full. End of. They wouldn't even take the application. This is a huge bank we've been with for 20 years and our credit is good. Even Helocs are still very hard to come by.

I can see both sides in this.

 

[ssawka]

I have a little more sympathy for the OP than a lot of you I guess. Have any of you tried to get a loan outside of Disney lately? We have a mortgage on our home, and when I inquired with our bank about buying vacation property (with 30% down) they stated they were not doing second home mortgages unless the residence was paid in full. End of. They wouldn't even take the application. This is a huge bank we've been with for 20 years and our credit is good. Even Helocs are still very hard to come by.

I can see both sides in this.

Yes, but the OP was not turned down, they were simply asked to provide more documentation.

 

[jennypenny]

Yes, but the OP was not turned down, they were simply asked to provide more documentation.

As I said, I can see both sides. I was responding more to the comments that people should get financing outside of disney like it was as easy as it used to be.

 

[Mtnman44]

So, after 2.5 pages, the jist of this thread is that man with 700 points that missed payment two months ago is mad that disney won't loan again without some underwriting requirments. Oh, and apparently currently has two loans.

Yawn.....moving on.

Unsolicited advice: if you have the money to buy and use 700 points each year, you don't need a loan for 100 more. Tax deduction? please.....

 

[k3chantal]

I really wish there was a 'like' button Mtnman44! You 'summed' it up nicely.

 

[tjkraz]

5) DVC is nothing more then a well established Time share program not the Ritz

Nobody is saying DVC is the Ritz but it is a nonessential expense. In financial terms that the textbook definition of a "luxury." Cost is irrelevant.

If you lose your job tomorrow or are injured and cannot work or fall victim to any other financial tragedy, you still need to put food on the table, roof over your heads and clothes on your backs. You will NOT need a timeshare. This is a big part of what drove the recession 3-4 years ago: banks lending too much money, consumers assuming too much debt and being unable to meet those obligations due to job loss or worse.

With the interest you pay on a DVC loan, you're paying $200+ per point for the cheapest resorts.

If you have existing loans ending, do yourself a tremendous favor and put that money in the bank for a few months and buy resale. Don't pay Disney $200+ for something you can get for $65 with a little patience.

9) I am just a middle class family man who enjoys his family and country

As are most of us. Maybe it's just me but I don't feel a tremendous amount of sympathy for someone who already owns $50-100K worth of DVC points, doesn't have the cash on hand to buy another 100 and isn't willing to provide DVC with whatever documentation they require to approve a five-figure loan.

 

[Dean]

5) DVC is nothing more then a well established Time share program not the Ritz

To a degree that's true. I'd say that DVC is just another nice timeshare, I'm not sure that they are that well established overall. The Ritz also sells timeshares though they are way out of my league.

 

[thedon3]

1)Thank sto those who gave meaningfull input.
2) I really like the education in the word "luxury". I can lead a full life knowing that.
3) I never needed or asked for sympathy.
4) I brought this whole issue up as a matter of principle, nothing more - nothing less
5) Some of you need to get a life
6) Last one - Safe Weekend

Thanks

 

[k3chantal]

No you didn't want sympathy; you wanted empathy. I think you found out that many of us have a hard time giving you empathy when you already have tons of points and are just inconvenienced for one year.