Can I do this?

[Alisha&Jay]

I was informed by a DVC guide that if I want to do an add on at BLT I would automatically get the preferred rate financing thru Disney. (I already have an AKV contract financed thru Disney, but at the standard rate financing), I was surprised by this but happy to hear it, I even had the guide verify that I would get the preferred financing rate even though my original contract/loan was at standard rates. So, this brings me to my question, just wondering if I can do this.

Right now I have an AKV contract and say I add on next year at BLT (getting the preferred financing thru Disney). Then, I sell my AKV contract resale. Finally, I add on again thru Disney at BLT or AKV to replace the contract I sold (getting the preferred financing rate again, because it's an add on). I'd rather not keep paying the standard rate if I can pay the preferred rate. Can I do this? This does,of course, assume I can sell my contract thru resale, not sure if that's even a possibility, it is a 300 point contract, maybe there is not demand for that? I don't know.

 

[Caskbill]

I don't know what the difference is between the two rates is, but I suggest you do all the math first.

First a 300 point contract will not sell at as high of a price per point as a lower contract. You could easily lose $20 to $30 per point between what you could sell for, and what you'd have to pay to Disney to buy new again.

On top of that you'd be paying a commission of about 10% on the sale of your 300 points.

If you lost $30/point on the difference between selling and buying again, and paid commission, you might be out over $10,000 to do this. I doubt very much the difference in interest between the standard rate loan you currently have and the interest of a preferred rate loan would be anywhere near this. Probably just a few hundred $$'s or so at most.

 

[Alisha&Jay]

Good points you make, my DH is great with the numbers, so he would have to sit down and figure it all out first, before we even listed our AKV contract. BTW, the difference in interest is about 5%, DH says this makes a big difference in the monthly payment. But I guess we'd have to run the numbers to see how it all washes out.