A few questions looking to purchase DVC

[Adela]

What is the Difference between disney direct and resale . I live in California . Does it make a real diffrence?

Originally posted by Tina
We will most likely go with a resale, so we are not too overly concerned with the Disney incentives right now. We are taking the advice of some many here to "buy where we want to stay," which for us is Beach Club or VWL.

However, I am interested in more info on your statement about no payment until next year. Am I confusing some of the information? I didn't realize there was a deferred payment schedule.

 

[tjkraz]

Originally posted by Adela
What is the Difference between disney direct and resale . I live in California . Does it make a real diffrence?

When you buy into DVC, you actually purchase an ownership interest in one of the 7 DVC resorts. This resort is called your Home resort.

While DVC allows you to book stays at all 7 resorts that are part of the program, you have a greater booking advantage at your Home resort. So, if you look at the roster of DVC resorts and one really catches your eye as being the destination you want to stay at the majority of the time, you would be wise to purchase points at that resort.

The resort DVC is most actively marketing is Saratoga Springs. Currently you can buy an ownership in SSR for as little as $85 per point, which gives you 49 years' of ownership.

You can also buy points at the other 6 resorts from DVC, but the price is a fixed $89 per point with no promotions available. Note that the ending date for these resorts is the year 2042, meaning that you only get 38 years of ownership.

DVC will finance the purchase for as long as 10 years with as little as 10% down.

From a financial perspective, it's hard to argue against SSR given the lower purchase price and longer contract duration.

Now let's talk about resales. Resales equate to buying DVC contracts on the secondary market--from a current DVC member rather than from DVC itself. The terms of sale are completely negotiable. However, DVC holds Right of First Refusal on any resales. Basically this means that you would negotate a deal on a DVC contract. The contract would then be submitted to DVC for review. If the terms of the contract are particularly generous toward the buyer (you), DVC will take the contract at the terms negotiated and you get nothing. Well, actually you get to start all over again negotiating with a new seller.

In today's marketplace, in order to pass ROFR you (the potential buyer) should figure on something like this:

$72-74 per point base price
Buyer pays closing costs (about $3 per point on a 150-200 pt contract)
Buyer pays maintenance on current year's points (about $4 per point).

That means you'll be paying net of $79-81 per point. Still quite a bit less than the flat $89 that DVC charges, but competitive with the $85 being charged for SSR (particularly when you factor in the 11 additional years for SSR).

On a resale contract, you either need to pay cash or arrange for your own financing.

Again, if your tastes favor one DVC resort over the rest, then you should seriously consider buying points at that resort. But if you don't really have a favorite or are unable to book your stays more than 7 months ahead of time, your Home resort doesn't matter so much. If this is the case, I'd recommend either Old Key West (via resale) or SSR (direct from DVC) due to low point costs and, more importantly, low annual maintenance fees.

 

[Adela]

I would Like to thank You for your Help. But I still need Help I live in California I am a Family of 5 Looking to buy into 160 Points DVC Offered me $89.00 a point at Old Key West . I Like to take vactions a various different locations every year Maybe 1 year to Hawaii, Disney World, Cancun, Conzumel Things like that . My kids are 5,12,9 I know If I buy at a diffrent timeshare I am I allowed at the Disney Resort ? Help Please

Originally posted by tjkraz
When you buy into DVC, you actually purchase an ownership interest in one of the 7 DVC resorts. This resort is called your Home resort.

While DVC allows you to book stays at all 7 resorts that are part of the program, you have a greater booking advantage at your Home resort. So, if you look at the roster of DVC resorts and one really catches your eye as being the destination you want to stay at the majority of the time, you would be wise to purchase points at that resort.

The resort DVC is most actively marketing is Saratoga Springs. Currently you can buy an ownership in SSR for as little as $85 per point, which gives you 49 years' of ownership.

You can also buy points at the other 6 resorts from DVC, but the price is a fixed $89 per point with no promotions available. Note that the ending date for these resorts is the year 2042, meaning that you only get 38 years of ownership.

DVC will finance the purchase for as long as 10 years with as little as 10% down.

From a financial perspective, it's hard to argue against SSR given the lower purchase price and longer contract duration.

Now let's talk about resales. Resales equate to buying DVC contracts on the secondary market--from a current DVC member rather than from DVC itself. The terms of sale are completely negotiable. However, DVC holds Right of First Refusal on any resales. Basically this means that you would negotate a deal on a DVC contract. The contract would then be submitted to DVC for review. If the terms of the contract are particularly generous toward the buyer (you), DVC will take the contract at the terms negotiated and you get nothing. Well, actually you get to start all over again negotiating with a new seller.

In today's marketplace, in order to pass ROFR you (the potential buyer) should figure on something like this:

$72-74 per point base price
Buyer pays closing costs (about $3 per point on a 150-200 pt contract)
Buyer pays maintenance on current year's points (about $4 per point).

That means you'll be paying net of $79-81 per point. Still quite a bit less than the flat $89 that DVC charges, but competitive with the $85 being charged for SSR (particularly when you factor in the 11 additional years for SSR).

On a resale contract, you either need to pay cash or arrange for your own financing.

Again, if your tastes favor one DVC resort over the rest, then you should seriously consider buying points at that resort. But if you don't really have a favorite or are unable to book your stays more than 7 months ahead of time, your Home resort doesn't matter so much. If this is the case, I'd recommend either Old Key West (via resale) or SSR (direct from DVC) due to low point costs and, more importantly, low annual maintenance fees.

 

[rinkwide]

Originally posted by Adela
I Like to take vactions a various different locations every year

It sounds like a DVC purchase would be a bad move in your situation. Unless you intend to go to WDW yearly (or at least every other year) your money will be much better spent elsewhere.

Don't forget, you can always rent DVC accomodations from a member right here on these boards (LINK) and get a-la-cart rates that are nearly as good as the ones DVC members have to pre-pay tens of thousands for.

 

[tjkraz]

Ditto what Rinkwide said. If your planned trips to WDW are not that frequent, buying into DVC probably doesn't make sense for you.

A couple of additional comments:

1. Trading INTO DVC from another timeshare is not nearly as easy as timeshare salesmen will lead you to believe. Some folks here have reported success with trades into DVC, but my understanding is that availability is extremely limited, you'll never have a broad choice of accommodations, and some seasons are impossible to get.

2. DVC does allow members to use points in trade for other locations around the world. This is not considered to be the most economical use of points, but it is possible. DVC Maintenance Fees are among the highest in the timeshare industry. And, when initiating a trade, you're often taking a step down in quality of accommodation. If you want to vacation elsewhere more often than you would at WDW, you would be better off looking into another point-based timeshare with lower buy-in cost and lower MF. Then, when you do want to visit WDW, you can either attempt a trade or just plan to rent points or pay cash.