Contracts that have been available for a bit

[Beckyb3]

I have been obsessing over where to buy and how many points and now and watching all the listings for the last few weeks. There are a few listings that are interesting to me but my question is, if a listing has been up for awhile and hasn't sold, is there something I should be worrying about or asking about? One of the contracts I looked at was listed as sale pending and then was available again and now it has been up for a few days which seems surprising because it seems like most of the listings I have looked at have sold pretty quickly. Any thoughts? Thanks in advance.

 

[Cbtexan04]

Just my $0.02, but I wouldn't worry about something being amiss with a contract that has come back onto the market. Things like buyers failing to secure financing happen all the time. I think it's important to review the amount of points in the current year / upcoming year just in case something occurred with those, but other than that I wouldn't hesitate to put in an offer if it matched my criteria.

As for how long a contract sits, it really depends on several factors. Some people just don't want that resort (or in my case, I already have a contract so I 100% want a particular use year). Others are looking for contracts with points in the current year so they can enjoy them.

If all else fails, you can always reach out to the broker as ask what's up

 

[LaneOT]

I

Just my $0.02, but I wouldn't worry about something being amiss with a contract that has come back onto the market. Things like buyers failing to secure financing happen all the time. I think it's important to review the amount of points in the current year / upcoming year just in case something occurred with those, but other than that I wouldn't hesitate to put in an offer if it matched my criteria.

As for how long a contract sits, it really depends on several factors. Some people just don't want that resort (or in my case, I already have a contract so I 100% want a particular use year). Others are looking for contracts with points in the current year so they can enjoy them.

If all else fails, you can always reach out to the broker as ask what's up

Totally agree with reaching out. I saw an SSR with fullnpoints in 18,19 and 20. I wanted to offer what I saw was above going rate (100) a few weeks back. The seller balked and has been waiting for a buyer to purchase at asking, which was $116. The broker told me he's refused every offer, which is why it's been sitting there since May!

 

[disneynutz]

I wouldn't want to buy from an international seller, I would ask the broker about the seller.

Bill

 

[LaneOT]

I wouldn't want to buy from an international seller, I would ask the broker about the seller.

Bill

What's the story with international sellers? Does it take longer?

 

[disneynutz]

What's the story with international sellers? Does it take longer?

Yes, and they have to go to a US embassy to sign and there is a foreign tax issue to be satisfied.

Bill

 

[LaneOT]

Yes, and they have to go to a US embassy to sign and there is a foreign tax issue to be satisfied.

Bill

Oh wow. I did not know that. My contract is currently awaiting rofr and the seller is international (Canada to be exact) so at least now I know I can expect a longer wait time.

 

[TexasChick123]

Oh wow. I did not know that. My contract is currently awaiting rofr and the seller is international (Canada to be exact) so at least now I know I can expect a longer wait time.

For what it’s worth, a contract I bought from Japanese sellers took less time than a contract I bought from someone that lived in NY. I bought another contract from a US citizen who had moved to Japan, and that one was pretty fast. She had to go to the embassy too. It was about a 2 week hold up on getting into the embassy. Not too bad.

Reasons why contracts sit:
1) overpriced and seller not willing to negotiate
2) larger contract
3) buyer backs out and contract goes back on the market
4) market slows down in the summer
5) cannot close until “x” date makes it less attractive
6) totally stripped for a year or two
Etc...

Those are just a few reasons off the top of my head.

 

[Mumof4mice]

What's the story with international sellers? Does it take longer?

They have to go to a Notary Public to sign documents, which in the U.S. can be accomplished by popping into an UPS store but in many countries involves an appointment to be made with a NP, and about a $100 fee. Then the documents have to be expressed back to the closing agent. I second TexasChick that notarization and postage didn't cause any delay in my purchase from an international seller.

The issue is the FIRPTA withholding. You should confirm that the closing agent knows that the seller is international and will withhold 15% of the sales proceeds for the FIRPTA. Otherwise you could potentially be held responsible for the FIRPTA. If you are international yourself, you'll have to apply for an ITIN, which causes further delays. I avoided purchasing from international sellers but inadvertently ended up with one (broker didn't disclose it). So found out the hard way!

 

[LaneOT]

They have to go to a Notary Public to sign documents, which in the U.S. can be accomplished by popping into an UPS store but in many countries involves an appointment to be made with a NP, and about a $100 fee. Then the documents have to be expressed back to the closing agent. I second TexasChick that notarization and postage didn't cause any delay in my purchase from an international seller.

The issue is the FIRPTA withholding. You should confirm that the closing agent knows that the seller is international and will withhold 15% of the sales proceeds for the FIRPTA. Otherwise you could potentially be held responsible for the FIRPTA. If you are international yourself, you'll have to apply for an ITIN, which causes further delays. I avoided purchasing from international sellers but inadvertently ended up with one (broker didn't disclose it). So found out the hard way!

I am not International. I was told prior to the sale that there was no responsibility on my part, that I would only have to provide I believe the last 4 of my social at closing, to do the taxes that the seller has to pay

 

[LaneOT]

My apologies to the opp, as I didn't mean to hijack the thread and ask about International sellers oops. My bad

 

[Marionnette]

I am not International. I was told prior to the sale that there was no responsibility on my part, that I would only have to provide I believe the last 4 of my social at closing, to do the taxes that the seller has to pay

Problems arise with the IRS sometimes, even when the tax has been paid. There is at least one disboard member who has posted about what a nightmare it can be to resolve. I'm one of those unlucky people for whom things always go wrong if they can. So I have passed up contracts with international sellers for this reason.

 

[kniquy]

is there something I should be worrying about or asking about?

One thought is that maybe the seller is asking too much, but have had and rejected other lower offers. Some people still owe loans on contracts and are likely financially unable to accept less than what they are asking. Otherwise I am sure at some point the seller will find that right buyer who will pay what they want -- be it that it is a perfect UY match for someone so they are willing to pay a little more.

Other thoughts is the points status on the contract -- when someone has stripped their contract of all points and nothing is coming until 2020 - it is kind of a hard sell unless someone is willing to wait a year before they can use their contract.

 

[cvjw]

I have purchased 3 contracts from European sellers. All closed fast, no issues at all. Maybe I just had very motivated sellers!

 

[kboo]

Re: international sellers - it isn't that bad, and my theory is that Disney doesn't ROFR them as much because of the paperwork and other potential hassles. We *just* got a doc from the IRS (we are US, bought from international sellers) that confirms that they got the FIRPTA withholding in the correct amount for our recent purchase, and so we don't owe anything. (We closed on July 5 or something.) I think we are supposed to keep that doc with our closing docs in case something happens in the future and someone claims the sellers didn't pay the tax they were supposed to.

When in doubt, lowball.

 

[sndral]

My sellers were in England and that one went faster than my first contract (which had divorcing U.S. sellers.)
I had to supply my full social security number, tho’, because foreign sellers don’t have one and if the closing company doesn’t correctly file the paperwork the IRS will seek the amt. owed from you but ultimately the closing co. will be liable if they messed the paperwork up.
I recently saw a bunch of contracts listed with cannot close before next May - I’m curious how long those will take to sell, they weren’t discounted and not loaded either, I’d go crazy waiting 9 months to get my points!

 

[Wakey]

I'm from UK, there's no issue with buying from us, we just need to get it notarized. The tax issue, the agent will know, 15% to be held back. It's then the seller's problem to sort it out (tax experts the brokers know will sort it out and get most back for about $500). The only thing to concern yourself with buying from an International Seller is ensuring the contract says the 15% will be held back to satisfy the liability andthe closing agent does this. It may or may not take longer. I could get docs back in 48 hours. I agree, probably less likely to ROFR.

 

[kboo]

My sellers were in England and that one went faster than my first contract (which had divorcing U.S. sellers.)
I had to supply my full social security number, tho’, because foreign sellers don’t have one and if the closing company doesn’t correctly file the paperwork the IRS will seek the amt. owed from you but ultimately the closing co. will be liable if they messed the paperwork up.
I recently saw a bunch of contracts listed with cannot close before next May - I’m curious how long those will take to sell, they weren’t discounted and not loaded either, I’d go crazy waiting 9 months to get my points!

Yup. We had to do that and finally got "proof" from the IRS that "our liability" is -0-. Of course you assume that the title company will and should do it properly, but it's just one more thing that COULD go wrong, so it adds a little complexity. But, if you can get a good deal ... it was worth it for us, but just barely.

 

[LaneOT]

Yup. We had to do that and finally got "proof" from the IRS that "our liability" is -0-. Of course you assume that the title company will and should do it properly, but it's just one more thing that COULD go wrong, so it adds a little complexity. But, if you can get a good deal ... it was worth it for us, but just barely.

Yeah, I knew it was an international seller. Did not know about FIRPTA (thanks @Mumof4mice), so I'll definitely keep my eyes peeled for it. I feel like we have a decent contract, with 100 pts at SSR for $100/pp with the UY of August. Most of SSR asking is 105 +! Hoping rofr comes through and we can get this process moving.

 

[TexasChick123]

Yup. We had to do that and finally got "proof" from the IRS that "our liability" is -0-. Of course you assume that the title company will and should do it properly, but it's just one more thing that COULD go wrong, so it adds a little complexity. But, if you can get a good deal ... it was worth it for us, but just barely.

Interesting. I don't think we ever got a letter from the IRS about this when we bought from international sellers. However, we used Vacatia, and they assured me that the 15% is withheld from the proceeds paid to the seller. Their title company is known as one of the good ones, and I was told multiple times this would be handled appropriately. OTOH, this was all last year, and we never got a letter from the IRS saying we owed them money either. They love to send us letters all the time about how one "i" wasn't dotted or a "t" wasn't crossed, so I am cautiously optimistic this was handled correctly. We do our own business taxes and got a letter last week saying that we didn't owe any money but Quickbooks was systematically submitting things that were off by one day, so we needed to call them. Yeah...