How do we split points with best friend?

[rodserry]

Another family and we would like to split purchase of GCV's 100 points when it goes on sale. Can 2 families be on the title together? Or how would we go about sharing these points. The nuances of who goes what year we have already worked out. I just need to figure out how to deal with the legalities.

Thanks,

Rod

 

[Deb & Bill]

Do both families currently share a contract? I think you will need to buy a completely new master contract, 160 points minimum when they go on sale. You can't title an add-on contract differently from a master.

That said, I hope your two families always are close and never have any problems.

 

[rodserry]

Very good point. We do not share a contract now. I think you are right, we would need a brand new contract, undoubtedly at the 160 point level. Yuck!

 

[Lynne M]

Would you buy a house with this family? It's a real estate purchase. If they divorce or file for bankruptcy, you may be forced to sell.

 

[Cmbar]

Rod, Have you spoken to a guide? I don't have much to tell you except when I asked my guide if my sister and I could buy points together he said yep, no problem we do it all the time with two families on the same contract. I didn't ask about legalities though. Good luck. I would be sure that you want to do this and then when you do be sure you have some sort of legal agreement discussing what happens if someone wants out (say you could buy them out of the contract in the future) or if someone on the contract were to die or divorce... etc.

Good luck. I wouldn't give up on it just yet. Just work through the problems. We thought this was the only way we could buy if they raised the minimum of BLT to 200 points. We couldn't afford it but my sister wanted just a smaller contract. Now that they have maintained the 160 buy in at BLT I think we will buy separately.

Good luck.

 

[paults]

I've got just one thing to say ARE YOU CRAZY!! don't do it.
If you do I hope you guys are great friends because this can really ruin a friendship.

 

[LisaS]

See if you can buy a 100 point add on split into two 50 point contracts. I don't know if they will allow this any longer since it's possible the Jan 15th increase of the minimum add on at BLT to 100 points is a sign that they are looking to prevent people buying small contracts. But if they will allow you to purchase two 50 pt contracts at VGC, you could then sell one of them to your friend, provided you set a price high enough to pass ROFR. With banking, you each still end up with 100 VGC points to use every other year and you are both protected from any financial or marital issues that arise with the other couple.

 

[Kmango]

I've got just one thing to say ARE YOU CRAZY!! don't do it.
If you do I hope you guys are great friends because this can really ruin a friendship.

I have to agree -- this has heartbreak written all over it. You're making a 50 year commitment to/with this other family. 50 years! And if you decide you need/want out of it at some point in the future, it's going to be very hard to get out, because either the other family will have to buy you out, or you'll all have to sell, or they'll have to find some other person to share with. None of these are particularly pleasant options. And would you be able to buy them out if they needed to sell? If the answer is no, you really shouldn't do it.

 

[disneybass]

I would say buy it yourself or don't buy it at all. Getting into a long term business deal with friends or family is very risky.

 

[CarolAnnC]

Also, Disney would not finance under these terms. The purchase would have to be paid in full at closing.

 

[kerickson]

If you do move forward with this, it should be treated like a real estate purchase and a partnership. We just purchased a rental property with another couple and created 3 documents to protect us and ensure we all agreed on primary details:
* Buy/Sell agreement. This should detail what would happen given death, divorce, etc and detailed the logistics of how we would set a price for the property if such situations ever arose.
* Indemnity agreement. An indemnity agreement is a contract where one party agrees to protect another party against certain future claims or losses.
* Partnership agreement. this laid out how we would use the property and roles and responsibilities of each partner

We had each document notarized to make them binding in case issues arose in the future.

 

[wayno]

I purchased a contract with my best friend in 2001. It's been nothing but great so far. We made our purchase through the Timeshare store and put both of our names on the deed. Look at it as a marriage. I made a lifetime commitment to my wife, but this is only for another 32 years

If you bought resale you wouldn't need to get the 160 points, but you also wouldn't be able to get the newest resort for another year or so I imagine.

Thanks,
Wayne

 

[AuntieM03]

Also, Disney would not finance under these terms. The purchase would have to be paid in full at closing.

Why would Disney not finance??

 

[Tink-n-Belle]

Have you thought of only 1 of you purchasing this but rent the points to them every other year?

For example: if the buy in is $112 you could charge them $112/50 years =$2.24 per point + mf for that year. So if MF are $4.00 it would cost them $6.24 per point used or $624 for 100 points.

That way this is totally fair to both parties if they decides to drop out. You get to keep the contract but the other party only paid for what they used.
I know you would be outlaying the cash for this but to me it is so much safer than going in with another family.

If you need help with the buy in cost- draw up a 10 year contract that they will prepay you for 5 years up front-- or 20 years-- that way again if they back out of the contract after 5 years you will only have to return the money instead of selling the contract.

GOOD LUCK!!

 

[LadyKay]

See if you can buy a 100 point add on split into two 50 point contracts. I don't know if they will allow this any longer since it's possible the Jan 15th increase of the minimum add on at BLT to 100 points is a sign that they are looking to prevent people buying small contracts. But if they will allow you to purchase two 50 pt contracts at VGC, you could then sell one of them to your friend, provided you set a price high enough to pass ROFR. With banking, you each still end up with 100 VGC points to use every other year and you are both protected from any financial or marital issues that arise with the other couple.

Three words.................."Brilliant idea LisaS"

 

[jar]

Have you thought of only 1 of you purchasing this but rent the points to them every other year?

For example: if the buy in is $112 you could charge them $112/50 years =$2.24 per point + mf for that year. So if MF are $4.00 it would cost them $6.24 per point used or $624 for 100 points.

That way this is totally fair to both parties if they decides to drop out. You get to keep the contract but the other party only paid for what they used.
I know you would be outlaying the cash for this but to me it is so much safer than going in with another family.

If you need help with the buy in cost- draw up a 10 year contract that they will prepay you for 5 years up front-- or 20 years-- that way again if they back out of the contract after 5 years you will only have to return the money instead of selling the contract.

GOOD LUCK!!

While this concept of an agreed-upon "rental" for every other year that shares the economics of the transaction can work in place of actual joint ownership, this formula doesn't work because it doesn't take into account net present value. The annual cost of $112/point for 50 years of usage is not $112/50 but $112 times the cost of capital (i.e., either your cost of borrowing or, if you have the cash, the expected long-term rate of return if you invested the $112 rather than gave it to Disney). Obviously we're in an aberrational market, but it's reasonable to peg that in the $6 range, which would be 5-6%. So if you added $4 in annual maintenance fees, the agreement would end up at around $10 (which is why point rentals are generally around $11-12 or so -- the "actual cost" plus a bit of profit to the owner). The number of years for the agreement is actually irrelevant to the calculation.

 

[SamSam]

This thread is a good example of why sharing a contract may not be a good idea. http://www.disboards.com/showthread.php?t=2067986

 

[nunzia]

also..it looks as if 100 in the new minimum..
I wonder if this will be for all resorts from now on?