Could everyone possibly be paying cash for resales??

[erin1715]

I'm not looking at a large loan. I am thinking around 100 points at SSR. We would plan to pay above and beyond our monthly payment, but of course life does have a way of throwing a wrench into the best laid plans. I haven't rushed into this decision and it's not taken lightly, but I'm fairly confident that we will be financing. I appreciate all of the input.

 

[Stacy's a freak]

And I will live vicariously through you! (Very jealous of the idea of owning DVC and knowing that future trips are scheduled).

 

[limabeanmom2003]

I think many people finance DVC purchases. But then again, there are people who have to finance everything they buy. Just because you can finance something doesn't mean you should. But that's you're choice, and like a PP stated, no one can tell you not to. Doesn't mean it's a smart financial choice though.

 

[kristenrice]

We bought our first contract (resale) and paid for it with inheritance money that we received when DH lost both of his parents within a year. We only bought 100 points with the intention of going 2 years in a row (using banking and borrowing) and then taking a year off. Then, we decided we wanted to go on vacation every year, but WDW is simply too expensive. So, we decided that HHI would be a great place to go in our "off" year. I watched and waited for a 50-75 points contract with a Feb UY to come available from resale, but after about 6 months of waiting, I caved in and called our guide. We were able to buy 50 points direct for $80/points and no closing costs. The monthly payment was $49 so I decided that I could cover that with a mere $25 out of each of my paychecks. I've made a few extra payments along the way and I know that we are paying a LOT in interest, but the bottom line is that the $25 I pay from each check is not a financial burden and it is an amount I am comfortable paying.

 

[lorenni]

I wonder if people use a home equity loan to finance a DVC purchase. Even though it's not technically for your home, you can deduct the interest on a home equity and the interest rate is much lower - likely less than half of a DVC loan.

im not sure that's technically accurate. I believe interest on a home equity loan is deductible only if the money is spent on the home. Not to say people don't deduct it anyways, but I'm not sure it would stand up on audit.

Interest on a loan used to purchase a second home (which includes a boat so long as it has a toilet!) is deductible, but I'm thinking DVC doesn't qualify as a second home.

 

[lorenni]

Oh and I bought with cash. My only other debt was (still is - can't wait to see the backside of Sally Mae) a mortgage and student loans, both at substantially lower interest rates than DVC financing.

 

[mickeyman]

There are a couple of finance options for resale. Monera financial and timeshare lending will finance without a credit check

 

[Dean]

im not sure that's technically accurate. I believe interest on a home equity loan is deductible only if the money is spent on the home. Not to say people don't deduct it anyways, but I'm not sure it would stand up on audit.

Interest on a loan used to purchase a second home (which includes a boat so long as it has a toilet!) is deductible, but I'm thinking DVC doesn't qualify as a second home.

As long as the loan is secured by the house and written as a mortgage it's deductible with limited caveats. Personally I think it's a bad idea to put one's home at risk for a timeshare no matter how much interest savings there is.

 

[suebeelin]

Oh and I bought with cash. My only other debt was (still is - can't wait to see the backside of Sally Mae) a mortgage and student loans, both at substantially lower interest rates than DVC financing.

I totally forgot about my student loan!! Thanks for the reminder... My interest is 1.68% so why would I ever pay that back early? Lol. So I guess I do have debt, I just forgot about it. Grad school was 11 yrs ago, so it's been outa site, outa mind.

 

[Sammie]

oh hindsight ... But I really wonder if DVC is a savings. I mean, you still have to pay that maintenance fee and your park passes. Mind you, I have only once stayed in a deluxe (AKL) and it was when I got a fantastic discount pin years ago. I don't think DVC would payoff for me when you factor in the maintenance fees. I mean, if you buy DVC, you're not getting X years of free vacations ...

It saves us huge discount on 2 bedroom villas. But then we have owned ours for over 18 years and our dues are low. We would never pay the asking price for a 2 bedroom villa even with an AP discount, without having DVC. Everyone has to buy tickets so to me that is not even a factor.

If you are booking value or even moderates and happy with that, then DVC probably will not save you money.

 

[lorenni]

As long as the loan is secured by the house and written as a mortgage it's deductible with limited caveats. Personally I think it's a bad idea to put one's home at risk for a timeshare no matter how much interest savings there is.

Right - but a home equity line is not a mortgage. There is a difference in the tax code, but as I said, it's subtle and often misused. Or maybe the rules changed to be more lenient since I did individual income taxes for a living.

 

[Sandisw]

I did pay cash for my purchases but would not have hesitated financing if I had needed to. When we bought in 2009, we were spending about $2500 to $3000 per year on the hotel part of our yearly Disney vacations. When I began to consider, I figured if my yearly fees for DVC, including finance costs was no more than what we were already paying, I figured we weren't in any worse shape. In fact, the points that would fit within that budget, would allow us to go for the same number of nights but in larger rooms.

Now, fast forward to today and of course, I own a lot more points than I originally thought I would so its not saving me money in that respect...but, I am going for a longer period of time and more often! Everyone makes financial decisions that fit their own situation and I think what is key is that you go into things wide open and are comfortable with the debt you may be securing, if you decide to finance.

 

[Dean]

Right - but a home equity line is not a mortgage. There is a difference in the tax code, but as I said, it's subtle and often misused. Or maybe the rules changed to be more lenient since I did individual income taxes for a living.

Generally they are legally and technically but it depends on how they're written. Most are essentially a "second" mortgage. My understanding is that they are for federal with certain caveats that also apply to other mortgages and for most states as well. It's dramatically unlikely that such a HELOC will exceed the $100K limit for a married couple or fair market value of a home which would be the only real limitations not applicable to mortgages in general. The chances of members not being able to deduct them legally would be close to zero, it'd be far more likely to be deductible than a DVC loan that was written as a mortgage due to the limit of how many properties one can use the deduction for (two) or possibly to come up against the $1Million mortgage limit.

 

[DisneyRegulars]

We financed our DVC purchases through a personal loan from our credit union. I think the rate was 3.75% on a four year loan. I'm so glad we financed. We own a house, we have our retirement accounts maxed out, and in the four short years we have own DVC we've gone on over 10 trips with my now six year old. We've also been able to bring my MIL twice, my parents once, my brother in laws family, and my brother. Those trips are really precious to me. I'm glad we were able to go on all those trips rather than saving up and skipping them all. The 4% in interest was well worth it to me. If financing works for you. Do it, and don't feel guilty about it. It's your money, and if you want to spend a little of it on interest, so you can start enjoying your life now instead of ten years from now, do it.

 

[linzjane88]

I truly believe most of the people who finance don't openly talk about it on the various boards because there is a feel that financing a timeshare is something a financially smart person wouldn't do.
I think it is a personal decision. While financing through Disney at their outrageous rates might not be a great option I don't think it should be looked at in the same light as someone who finances for 1-5 years at a 5% or less interest rate.

 

[Jessiemendez1]

I'm not looking at a large loan. I am thinking around 100 points at SSR. We would plan to pay above and beyond our monthly payment, but of course life does have a way of throwing a wrench into the best laid plans. I haven't rushed into this decision and it's not taken lightly, but I'm fairly confident that we will be financing. I appreciate all of the input.

We paid cash for our first 210 AKL resale. Then decided we needed more points. Bought 360 AKL resale, financed the shortest option with the most money down and will pay off when we sell the first contract. I am okay with the few payments I will have to make. Good luck!

 

[pmaurer74]

oh hindsight ... But I really wonder if DVC is a savings. I mean, you still have to pay that maintenance fee and your park passes. Mind you, I have only once stayed in a deluxe (AKL) and it was when I got a fantastic discount pin years ago. I don't think DVC would payoff for me when you factor in the maintenance fees. I mean, if you buy DVC, you're not getting X years of free vacations ...

It spends upon how you use it. I called about getting a 2 bedroom villa for my sister through Disney with a military discount. With a 40% discount it was $5,000. I have two two bedroom villas already reserved using 2 years of points, cost for me with MFs is $2400. There is of course original cost in there of about $1200 if I keep the contract the remaining 26 years so, in this case it is a huge savings for my family. Total cost = $3600, savings of $6700 assuming the 40% discount.

 

[pmaurer74]

We were going to buy a DVC a few years ago but then decided to build a house and are house poor for awhile. I received an unexpected inheritance and used 50% of it to buy a DVC and save the other 50% and paid of some short term debt. My aunt loved family and spent a lot of time with family. It will make me happy to be taking people with us to Disney with our DVC and hopefully provide honeymoons for my girls someday. We are taking 15 people to Disney this year with our DVC on two separate trips using 3 years of points.

 

[Jessiemendez1]

It spends upon how you use it. I called about getting a 2 bedroom villa for my sister through Disney with a military discount. With a 40% discount it was $5,000. I have two two bedroom villas already reserved using 2 years of points, cost for me with MFs is $2400. There is of course original cost in there of about $1200 if I keep the contract the remaining 26 years so, in this case it is a huge savings for my family. Total cost = $3600, savings of $6700 assuming the 40% discount.

We can only stay in 2 bedrooms so it works out to be a great savings for us. We should hit our break even point at about 4 years. And we own AK until 2057! If I could stay in a studio,
I don't think it would save us as much.

 

[sndral]

Actually a couple years ago we were skipping WDW due to schedules and I just took the money I would normally pay for the WDW trip and used it to buy resale points. With 10-11 day stays in a deluxe (either 2 rooms or a DVC villa) plus airfare plus tickets plus dinning it was enough to buy the points @ that time. So in my mind I was even when I started