Points may be used to book reservations at the "home resort" up to 11 in advance. So, at 11 months, you could book a room at BLT using the 250 points you own there or book a room at AKV using the 250 points.
At the 7 month mark, you can use all 500 points and book any of the
DVC resorts you wish, using a combination of those points in any way you wish.
I have heard members who use banking and borrowing so that they can alternate between two home resorts every other year and avoid doing "split stays". For example, if you banked your 2009 BLT points but borrowed your 2010 AKV points, you would have 500 AKV points to use in 2009 (but no BLT) and 500 BLT points to use in 2010 (but no AKV).
After two years, you just repeat the cycle. As many other posters have said, buying those points in multiple contracts would be a good idea as it gives you flexiblilty. 500 points is a lot and by having the multiple contracts, you could always sell off some of the points if you find that it is more than you need in a few years (of course, for most of us, we can NEVER have enough points!!!!:

)
Good luck and happy planning!!!!