Banking/Borrowing & UY questions

[magicbob]

I know these questions have probably been asked and answered ad nauseum, but I want to make sure that I have a clear understanding of these important facets of DVC.

For the purpose of keeping things simple, the example contract I’ll use is a 200 point contract. Again, just to keep the math simple let’s assume the villa I book goes for 100 points weekly.

Topic 1: Borrowing

I think I have a handle on the rules of borrowing.

Say I have 200 points available for 2014, but I decide to go hog wild and want to book a villa for 400 points this year. I would borrow 200 points from 2015 (my entire 2015 allotment). I also understand that if I have to cancel my trip, those 200 borrowed points still expire in 2014, they can’t be returned to 2015. I would either have to re-schedule within my current UY, rent them, or lose them. Am I on target so far?

Let’s assume my trip didn’t have to be cancelled and we had a fabulous time in 2014. Now it’s 2015. I have no points to use this year because I borrowed all of them last year. I can simply borrow some or all of 2016’s points to use in 2015. Still on track? Let’s assume I want to book my normal 200 point vacation from now on. I could continue to borrow all of the following year’s points without “paying back” the 200 I’m in the red for until the contract is about to end and in that final year I would have no points available and nowhere to borrow from? Basically, I shortened my contract by one year because I used those points way back in 2014 and just kept borrowing forward. Not that I plan to do this, but is that feasible or have I misunderstood how borrowing works? In reality, I would probably skip booking anything in 2015 since I already used 2015’s points and then I’d be back on track for 2016.

Part two of borrowing: A little closer to reality. Say I only need to borrow 50 points from 2015 instead of going hog wild and borrowing all 200 points. I could either continue to borrow 50 points each year if I needed them OR I could book a shorter stay (or smaller room) for 150 points in 2015 and then 2016 points would be treated as normal. Am I still tracking?

Topic 2: Banking

I think I’ve got this down, but I’m not as confident that I’ve got the details. And since banking is riskier (in terms of possibly losing points), I want to make sure I fully understand the ins and outs.

Same example contract… 200 points

Again, let’s assume that I book a villa in 2014 for only 100 points. I then bank 100 points. Those 100 banked points must be used within my 2015 UY or they will expire (use or lose), correct? BUT Banked points get used before new points, right? So in 2015, I don’t have to book a 300 point villa to avoid losing my 2014 points. Instead, if I book for 200 points, I’d be using my 100 banked points and using 100 current points. Then I would bank 100 2015 points until 2016. So, just like borrowing, I could theoretically keep kicking those points down the road (they wouldn’t technically be the SAME points, but the same amount of points anyway)? The only way I see points expiring is if I bank them and then don’t use at least that many points the following year (assuming I don’t rent the points). Is there any other circumstance by which banked points would expire?

I realize that the reality of borrowing and banking is more likely to be a lot more complex in terms of the actual numbers (e.g., I need to borrow 17 points one year and perhaps I borrow 23 the next, but then the next year I “pay off” the borrowed points, use 100, and bank 60 points), but the concepts are the same.

Topic 3: UY

I think we would mostly travel in September or October. If I understand UY correctly, September UY would be most beneficial, correct? Our points would activate each September. If we had to cancel a Sep or Oct trip, there would be plenty of time left in the year to re-schedule or rent points that we might otherwise lose. With Sep UY, I would be able to book (home resort) in Oct for the FOLLOWING September’s trip, correct? If we decide to travel in October, we can book in November for the following October? If we decide to book a different resort (7 month window), we could book in February for a September trip or in March for an October trip, correct?

Thanks in advance!

 

[drusba]

Everything you have described is correct.

 

[nabi]

Topic 1- I think when getting close to contract expiring, there may be no borrowing allowed. There would be a problem without some sort of change in point usage that last year. Topic 2- I've heard of some issues with current UY points used, though by mistake, prior to banked...unsure of the validity. Topic 3- being that February has 28 or 29 days, booking either September 29 or 30 will have to wait until march 1st....I know, more info than you asked, but yes, you are correct.

 

[magicbob]

Topic 3- being that February has 28 or 29 days, booking either September 29 or 30 will have to wait until march 1st....I know, more info than you asked, but yes, you are correct.

If I understand what you're saying, you can make a reservation on the corresponding date of the month 11/7 months prior?

For example, September 15th arrival could be booked on October 15th at home resort or February 15th at a different resort? But September 29 and 30 have no corresponding date in February (except during leap year for the 29th), which is why you would have to wait an extra day until March 1st?

 

[nabi]

Correct...seems you have a hold on these topics!

 

[maburke]

And since banking is riskier (in terms of possibly losing points), I want to make sure I fully understand the ins and outs.

I don't know why you'd say banking is riskier; maybe because they are not immediately allocated to a reservation, so you might not have a plan to use them? I think of borrowing as riskier, because if you have to cancel, you have a lot less time to book and use them. If I bank points, and know I'm not going to use them, I then possibly have the opportunity to rent them for someone else's 11-month reservation window.

 

[CarolMN]

Just remember that you still have to pay annual dues every year until the contract ends, even if you have no points left to spend.

So technically in the borrowing scenario described, you didn't shorten your contract by a year. You still have to pay the piper for the extra fun you already had.

 

[magicbob]

I don't know why you'd say banking is riskier; maybe because they are not immediately allocated to a reservation, so you might not have a plan to use them? I think of borrowing as riskier, because if you have to cancel, you have a lot less time to book and use them. If I bank points, and know I'm not going to use them, I then possibly have the opportunity to rent them for someone else's 11-month reservation window.

Just remember that you still have to pay annual dues every year until the contract ends, even if you have no points left to spend.

So technically in the borrowing scenario described, you didn't shorten your contract by a year. You still have to pay the piper for the extra fun you already had.

Great points (no pun intended). I doubt I would ever bank or borrow that extensively, but just wanted to make sure I correctly understood in case I need to.

I guess I see where borrowing is risky if you did have to cancel a trip. In the case of cancellation, "normal" points could just be banked if not able to re-schedule that year, but borrowed points would be lost. I've fortunately never had to cancel a trip, so I was thinking I would only borrow points if I had a specific need for them. But banked points were ones that didn't get used and must be used the next year or they are lost. I guess it's that expiration date on them that made me perceive banked points as riskier.

If I decided on an October UY, but one year we want to travel in September, that would theoretically be the riskiest proposition in term of cancellation and having no time to re-schedule during that UY. But if I wasn't borrowing any points for the September trip, if I had to cancel, the points would be able to be banked and not lost, right?

 

[maburke]

If I decided on an October UY, but one year we want to travel in September, that would theoretically be the riskiest proposition in term of cancellation and having no time to re-schedule during that UY. But if I wasn't borrowing any points for the September trip, if I had to cancel, the points would be able to be banked and not lost, right?

IF you cancelled in the first 8 months of the use year. For an October UY, points must be banked by the end of May. That's why, if your travel habits are relatively stable, you should choose a UY where you rarely travel in the 4 months prior.

Also, even if you're within your banking window, if you cancel less than 30 days out, your points go into "holding" status: you can only use them on a reservation for 60 days into the future, and they cannot be banked.

 

[magicbob]

IF you cancelled in the first 8 months of the use year. For an October UY, points must be banked by the end of May. That's why, if your travel habits are relatively stable, you should choose a UY where you rarely travel in the 4 months prior.

Also, even if you're within your banking window, if you cancel less than 30 days out, your points go into "holding" status: you can only use them on a reservation for 60 days into the future, and they cannot be banked.

I see. Banking rules are a little more complicated than I realized. I'll have to do a little more brushing up on the "banking window." So, this would not only affect cancellation, but if I hadn't booked a trip yet, I'd have to decide to bank by then if I think I won't be using those points.

 

[bakerworld]

If I've anything left by my banking window than I bank. Every year I end up with a pt or two sitting so I bank them to not loose them.

We use to go pretty exclusively in the Spring and really liked a Dec UY as our banking window was past our use but now that we're into the F&W it's become a bit chancy.

 

[maburke]

If I've anything left by my banking window than I bank. Every year I end up with a pt or two sitting so I bank them to not loose them.

We use to go pretty exclusively in the Spring and really liked a Dec UY as our banking window was past our use but now that we're into the F&W it's become a bit chancy.

As difficult as it is to book with less than 4 months' notice, it doesn't seem like a big commitment to bank by then. I'm often banking earlier and booking in the next year by then. But if something did come up at the last minute and you'd already banked, what you could do is borrow the next year's points back (not reversing the banking, but borrowing from the next year.)