Annual Dues Bill Received 1 Month After Paperwork

[Ruby.D]

I recently became a DVC member directly through Disney. We decided on a December UY.
Final papers were signed last month and I was under the impression that we wouldn't have any dues until January 2018. We didn't finance, we bought it on cash. I was surprised to to received a bill this month for 261 prorated days. I emailed our Sales Rep, but I haven't heard back from him yet. I'm wondering if anyone can explain this to me. Did I misunderstand the annual dues?

Thank you!

 

[BillPA]

It's for your 2016 points, buying before Dec 2017 will get you 2016 points plus another set on Dec 2017

 

[Ruby.D]

It's for your 2016 points, buying before Dec 2017 will get you 2016 points plus another set on Dec 2017

I thought 2016 points dues would have been included in the purchase... or was it my wishful thinking?

 

[ELMC]

I thought 2016 points dues would have been included in the purchase... or was it my wishful thinking?

The points were included in so much as you receive them, but nothing is free. Points are on a Use Year basis but maintenance fees are on a calendar year basis. So you still owe dues for the 261 days in 2017 that you are a member. Had you purchased on November 30, 2017 you would have received the same amount of points (2016 and 2017 UY) and only paid 32 days worth of dues instead of 261.

Please take this next comment with only the best of intentions. It seems as if there are elements to your contract that you do not yet fully understand. I would recommend that you do a lot of reading and ask a lot of questions so that you can fully understand and maximize your use and enjoyment of your DVC purchase.

 

[KAT4DISNEY]

Dues are pro-rated from the date you sign the contract if you get current points. For a Dec UY that would have been receiving 2016 points. If you were not getting points until 2017 the you would have received a bill for 1 month of dues in December.

 

[Ruby.D]

Thank you all for your insights! It makes sense now

 

[Littlelulu01]

I recently also purchased some June uy direct points. Correct me if I'm wrong but I was told the 2016 points actually are free as in no fees and that the prorated bill for 2107 points was billed in a month or two. Also just purchased resale and I paid the mf's for 2017 points so I guess that makes sense. So I received the 2016 set for free and pay for prorated 2017 points/have access to two years of points for the cost of less than one year of dues.

 

[Littlelulu01]

The points were included in so much as you receive them, but nothing is free. Points are on a Use Year basis but maintenance fees are on a calendar year basis. So you still owe dues for the 261 days in 2017 that you are a member. Had you purchased on November 30, 2017 you would have received the same amount of points (2016 and 2017 UY) and only paid 32 days worth of dues instead of 261.

Please take this next comment with only the best of intentions. It seems as if there are elements to your contract that you do not yet fully understand. I would recommend that you do a lot of reading and ask a lot of questions so that you can fully understand and maximize your use and enjoyment of your DVC purchase.

In your example say I purchased CCV on November 30 for a December uy. I get the 2016 points for free. I'll get a bill in about 30-60 days prorated for 32 days on 2017 points and I get two uy of points for that minimal mf's bill. If I purchase ccv on December 1, 2017 I get no 2016 points and I get a bill prorated for the 31 days.

Had op picked a February uy instead of December they'd have received the exact same bill for the 2017 points and they would not have received any 2016 points so their 2016 points received are, "free." They're just paying a few months extra on the prorated 2017 points compared to had they purchased on November 30.

 

[KAT4DISNEY]

I recently also purchased some June uy direct points. Correct me if I'm wrong but I was told the 2016 points actually are free as in no fees and that the prorated bill for 2107 points was billed in a month or two. Also just purchased resale and I paid the mf's for 2017 points so I guess that makes sense. So I received the 2016 set for free and pay for prorated 2017 points/have access to two years of points for the cost of less than one year of dues.

@LisaS describes it really well but if what you were told was true then the way DVC calculates if you don't get current points (like when a new resort goes on sale) is not what would be done. Say CCV buyers just got 2017 points. Every UY would be prorated from the first day of their UY even if they bought on the same day this year. If it were the way your guide described every UY would pay the same dues if they purchased on the same day.

Many guides like to refer to current points as "free" these days because it sounds good in the sales. They did not always do this but have for several years now. For a June UY you bought current points which happened to be referred to as 2016.

 

[Littlelulu01]

@LisaS describes it really well but if what you were told was true then the way DVC calculates if you don't get current points (like when a new resort goes on sale) is not what would be done. Say CCV buyers just got 2017 points. Every UY would be prorated from the first day of their UY even if they bought on the same day this year. If it were the way your guide described every UY would pay the same dues if they purchased on the same day.

Many guides like to refer to current points as "free" these days because it sounds good in the sales. They did not always do this but have for several years now. For a June UY you bought current points which happened to be referred to as 2016.

The way my guide explained it is that if I purchase ccv February uy I don't get feb 2016 points and I pay prorated fees for 2017 from resort open till end of the year. If I purchase a uy that occurs after the resort is open then I get 2016 points and still only pay mf's from date of purchase till end of year so I get 2016 points, "free". If i want ccv December uy and purchase on November 30, 2017, I'll get the 2016 uy points free, pay maintenance fees on the 2017 uy points from 11/30-12/31 so 32 days. If I purchase December uy ccv on December 1st I will only get the 2017 points and pay prorated fees for 2017 from December 1-31, 2017= zero free 2016 points.

I purchased add on points on AKV in May, 2017. I got the 2016 uy points no mf's and a bill for the 2017 points prorated from date I purchased through end of the year. Had I purchased a June uy in June, 2017 I'd have to still pay prorated fees for the 2017 points from date of purchase till end of year but I would not receive the 2016 points. Basically in my case with an already open resort, I got 2016 points for zero mf's and the 2017 points at about 1/2 price. It definitely pays to purchase direct points at least a month prior to your uy start.

At the end of the ccv contract - contract will expire January 31, 2068. December, 2067 will be last allotment of points and payment for those points will be due in January, 2067.

For my resale contract June uy, I paid sellers for the 2017 points received at closing. On my dvc membership page, my Aulani contract shows my June 2017 points available and shows, "2017 use year points paid in full." I'll have to pay the 2018 mf's on 2018 points in January of 2018 even though the use year doesn't start till June. All uy points are due in January, 2018 for any 2018 uy points.

 

[KAT4DISNEY]

The way my guide explained it is that if I purchase ccv February uy I don't get feb 2016 points and I pay prorated fees for 2017 from resort open till end of the year. If I purchase a uy that occurs after the resort is open then I get 2016 points and still only pay mf's from date of purchase till end of year so I get 2016 points, "free". If i want ccv December uy and purchase on November 30, 2017, I'll get the 2016 uy points free, pay maintenance fees on the 2017 uy points from 11/30-12/31 so 32 days. If I purchase December uy ccv on December 1st I will only get the 2017 points and pay prorated fees for 2017 from December 1-31, 2017= zero free 2016 points.

I purchased add on points on AKV in May, 2017. I got the 2016 uy points no mf's and a bill for the 2017 points prorated from date I purchased through end of the year. Had I purchased a June uy in June, 2017 I'd have to still pay prorated fees for the 2017 points from date of purchase till end of year but I would not receive the 2016 points. Basically in my case with an already open resort, I got 2016 points for zero mf's and the 2017 points at about 1/2 price. It definitely pays to purchase direct points at least a month prior to your uy start.

At the end of the ccv contract - contract will expire January 31, 2068. December, 2067 will be last allotment of points and payment for those points will be due in January, 2067.

For my resale contract June uy, I paid sellers for the 2017 points received at closing. On my dvc membership page, my Aulani contract shows my June 2017 points available and shows, "2017 use year points paid in full." I'll have to pay the 2018 mf's on 2018 points in January of 2018 even though the use year doesn't start till June. All uy points are due in January, 2018 for any 2018 uy points.

As I mentioned, the guide is not really explaining it correctly. The CCV Feb UY also is a good example of why it isn't exactly correct when referring to "not Paying" for 2016 points. The Feb UY will be charged for dues from CCV opening in July thru the end of the year and will have current 2017 points. Then look at a Dec UY who will receive 2016 points. They also will be charged dues from the opening date of the resort in July.

If "2016" points were "free" as he's stating then Dec UY's would be prorated from Dec 1, 2017 for one month, not from opening because they won't get the points they are paying for per the guide until Dec. It's all about receiving current points, not the year used to describe them.

 

[Littlelulu01]

As I mentioned, the guide is not really explaining it correctly. The CCV Feb UY also is a good example of why it isn't exactly correct when referring to "not Paying" for 2016 points. The Feb UY will be charged for dues from CCV opening in July thru the end of the year and will have current 2017 points. Then look at a Dec UY who will receive 2016 points. They also will be charged dues from the opening date of the resort in July.

If "2016" points were "free" as he's stating then Dec UY's would be prorated from Dec 1, 2017 for one month, not from opening because they won't get the points they are paying for per the guide until Dec. It's all about receiving current points, not the year used to describe them.

I would get points right now for a December uy ccv. They're 2016 free points as in no mf's. I pay dues from either date of resort open OR date of purchase through end of year whichever comes later. So if purchase on November 30 for a December uy, I'd get the 2016 points free and only pay mf's on 2017 points from November 30(date of purchase which is later than resort open) through end of year. 32 days of mf's. If I purchase December uy on December 1st I pay one less day of prorated mf's for 2017 points but I get zero 2016 uy free points. If I purchase December uy ccv today then it's December 2016 points free, December 2017 points prorated from date of resort open. If I purchase December uy points in August then it's December uy 2016 points free and 2017 points prorated from August purchase date. Purchase December uy in September and it's date of September purchase through end of year...

I didn't get charged for the 2016 June uy points on my AKV contract that I purchased in May. I got those points for no mf's and have to pay my 2017 mf's prorated from date of purchase through end of this year. Had I waited until June 1 to purchase the points, I'd only get 2017 points and pay about the same mf's for the 2017 prorated fees as I paid by purchase in May. It would be a couple dollars less only because I purchased a couple days later so prorated 2017 points from June till December vs prorated May to December. If I had to pay 2016 and 2017 mf's my bill would have been $6.41 (cost of mf's in 2016) x 25 points or $160 plus the cost of the 2017 points at $6.58 (cost of dues per point in 2017)x's 25 points. My bill was for something like $90. That is not the cost of 2016 plus 2017 points. The 2018 points won't be billed till January, 2018 for my 2018 points.

 

[ELMC]

I would get points right now for a December uy ccv. They're 2016 free points as in no mf's. I pay dues from either date of resort open OR date of purchase through end of year whichever comes later. So if purchase on November 30 for a December uy, I'd get the 2016 points free and only pay mf's on 2017 points from November 30(date of purchase which is later than resort open) through end of year. 32 days of mf's. If I purchase December uy on December 1st I pay one less day of prorated mf's for 2017 points but I get zero 2016 uy free points. If I purchase December uy ccv today then it's December 2016 points free, December 2017 points prorated from date of resort open. If I purchase December uy points in August then it's December uy 2016 points free and 2017 points prorated from August purchase date. Purchase December uy in September and it's date of September purchase through end of year...

I didn't get charged for the 2016 June uy points on my AKV contract that I purchased in May. I got those points for no mf's and have to pay my 2017 mf's prorated from date of purchase through end of this year. Had I waited until June 1 to purchase the points, I'd only get 2017 points and pay about the same mf's for the 2017 prorated fees as I paid by purchase in May. It would be a couple dollars less only because I purchased a couple days later so prorated 2017 points from June till December vs prorated May to December. If I had to pay 2016 and 2017 mf's my bill would have been $6.41 (cost of mf's in 2016) x 25 points or $160 plus the cost of the 2017 points at $6.58 (cost of dues per point in 2017)x's 25 points. My bill was for something like $90. That is not the cost of 2016 plus 2017 points. The 2018 points won't be billed till January, 2018 for my 2018 points.

I think the mistake you are making is in drawing the (incorrect) conclusion that the year that dues are paid relates directly to the UY of the points. This is not correct.

Points are allocated on a UY basis. If you have a June UY you get your points June 1. December UY you get your points on Dec 1. That much I think we all understand. Here's where it gets complicated. Dues are paid on a calendar year basis. Where it's getting confusing is because this is your first year. So I'm going to fast forward to 2018 for this example and then relate it back to your individual situation.

Let's say I have two DVC contracts. One is a June UY and one is a Dec UY. In January of 2018 I will be required to pay my 2018 calendar year dues. For ease of purpose, let's say my dues are $1,200 for each contract.

For my June contract, that $1,200 is allocated as follows:

5/12, or $500 goes to pay dues on the 2017 points that I received on June 1, 2017. That's right, technically I got those points on June 1, 2017 and didn't have to pay dues on them until 2018. The remaining 7/12, or $700 goes to pay for the dues on the points that I will receive later on that year.

For my December contract, that $1,200 is allocated as follows:

11/12, or $1100 goes to pay dues on the 2017 points I received on December 1, 2017. The remaining 1/12, or $100 goes to pay for the dues on the points I will receive in December of that year.

So when the salesperson is telling you that the points are "free" that's not exactly true. They are free to you, because they are not asking you to reimburse the maintenance fees that they as the developer were responsible for on January 1 of that year when they were the owners of the points. Remember, November 30, 2017 is technically part of the December 2016 UY. It's complicated, and it's the reason why a lot of timeshare systems just give everybody their points on January 1.

Understanding how this works is painful at first, which is why resale brokers (falsely) line up UY with maintenance fee reimbursement. If you buy a Dec resale contract with no points right now and all points coming in December 1 of 2017, you should only reimburse 1/12 of the maintenance fees. But as a whole brokers do not see it that way and it's a real uphill climb to argue that point.

 

[Littlelulu01]

I think the mistake you are making is in drawing the (incorrect) conclusion that the year that dues are paid relates directly to the UY of the points. This is not correct.

Points are allocated on a UY basis. If you have a June UY you get your points June 1. December UY you get your points on Dec 1. That much I think we all understand. Here's where it gets complicated. Dues are paid on a calendar year basis. Where it's getting confusing is because this is your first year. So I'm going to fast forward to 2018 for this example and then relate it back to your individual situation.

Let's say I have two DVC contracts. One is a June UY and one is a Dec UY. In January of 2018 I will be required to pay my 2018 calendar year dues. For ease of purpose, let's say my dues are $1,200 for each contract.

For my June contract, that $1,200 is allocated as follows:

5/12, or $500 goes to pay dues on the 2017 points that I received on June 1, 2017. That's right, technically I got those points on June 1, 2017 and didn't have to pay dues on them until 2018. The remaining 7/12, or $700 goes to pay for the dues on the points that I will receive later on that year.

For my December contract, that $1,200 is allocated as follows:

11/12, or $1100 goes to pay dues on the 2017 points I received on December 1, 2017. The remaining 1/12, or $100 goes to pay for the dues on the points I will receive in December of that year.

So when the salesperson is telling you that the points are "free" that's not exactly true. They are free to you, because they are not asking you to reimburse the maintenance fees that they as the developer were responsible for on January 1 of that year when they were the owners of the points. Remember, November 30, 2017 is technically part of the December 2016 UY. It's complicated, and it's the reason why a lot of timeshare systems just give everybody their points on January 1.

Understanding how this works is painful at first, which is why resale brokers (falsely) line up UY with maintenance fee reimbursement. If you buy a Dec resale contract with no points right now and all points coming in December 1 of 2017, you should only reimburse 1/12 of the maintenance fees. But as a whole brokers do not see it that way and it's a real uphill climb to argue that point.

This makes sense and thanks for taking the time to explain it. I know there's no, "free" points in the end but I was really happy that my June uy resale contract closed in May and I was able to add on prior to June 1. Had it closed in June and I was unable to purchase add on until June, I'd still have to pay about the same mf's and I'd only be getting 2017 points.