Davids DVC: Rental reimbursement or rescheduling?

[banzai75]

Have you tried to process a chargeback first? Some reported that David is still honoring the credit if the chargeback if settled in his favor.

Agree. Try a chargeback first then you can book with whomever you want. His voucher may not be worth anything and he may not have points to book it with.

once you accept you lose all your leverage and rights.

 

[moab44]

i.e., If no owner wants to do business with me, or I can't find you a reservation for your requested dates, you get...

Have you tried to process a chargeback first? Some reported that David is still honoring the credit if the chargeback if settled in his favor.

I called my credit card company they said I was covered under their insurance for up to $1000.00 per person if the trip is cancelled. Even by pandemic. They ask about vouchers being offered. If those fall through I’m still covered. No time limit either

 

[Fred M]

This is true, I forgot about the initial disbursement in that calculation. The rest should still be held, though. Business should pay itself last. (wishful thinking, I know.).

Totally agree with you. If David's took their commission only on check in by the renter, then he would have close to enough money to line up a new owner for that rental, even if the original owner didn't return any money. Let's say someone rented out 160 points through David's at $20 per point. Renter pays David's $3,200. David's commission on that is $720. The owner is then slated to get $2,480, with 70% at the time of rental ($1,736) and 30% when the renter checks-in ($744). As many others above have posted, at the time of rental, the owner only has 54% percent of the funds and the 46% balance is with David's. If David's takes a commission at the time of check-in, and not time of reservation, then David's has $1,464 in escrow and only needs to go out of pocket $272 to line up a new owner, and then David's has 7 to 11 months to make enough off of other commissions to pay himself back the $272 and come up with the owner's $744 for the 30% payment. But if he spent his commission, then he's only sitting on $744, and his out of pocket costs to get a new owner is close to $1,000. Makes it much harder to line up a new owner, unless the original owner refunds the 70%.

And as for why an owner wouldn't refund the 70%, that amount, depending on when the owner bought is close to, or for some of us, less than the maintenance fees plus price of acquisition on those points. The 70% works out to $10.85 per point in this situation. If the owner got those points for $150 per point, and paid cash, that's $24,000 spread out over basically 50 years (not including tax, title, transaction fees). Even if we don't compound the loss of use for that money, that's $480 per year or $3 per point. Current maintenance fees plus $3 per point will exceed $10.85 for a lot of owners. If an owner is losing those points and can't bank them, then it's understandable why an owner would keep the 70%. And really, David's should be making the renter whole, not the owner.

 

[moab44]

Agree. Try a chargeback first then you can book with whomever you want. His voucher may not be worth anything and he may not have points to book it with.

once you accept you lose all your leverage and rights.

When I asked about CC they asked a bunch of question and then passed me onto the insurance people. So I’m guessing the chargeback might not be available

 

[Marionnette]

My family and I are talking about hitting accept on the voucher and trying to book again for next April for the BCV or BWV. We have enough of a credit that we won’t have to pay anything extra, I hope. Has anyone hit accept and tried to book again? We have rented the last five years from Dave’s. In those previous year everything worked out well.

Are you willing to pay David’s another deposit to seek that new reservation? If you do, and the voucher covers the complete price of the rental, how will David’s handle the cash you forked over for the “deposit”? Will he apply it to the cost of the rental first, before applying the voucher?

Booking for April 2021 begins May 1. You’ve chosen two very popular resorts (Flower & Garden Festival time). What will you do if David’s can’t line up a BWV or BCV willing to take a chance on David’s in time to get you one of those resorts.

I think that those who are taking the vouchers should consider that this will be a new rental market when the dust settles. If you thought reservations at BCV, BWV, or RIV were unicorns before all of this, you can be assured that they will be non-existent now. Be prepared to either accept SSR or do a hotel reservation.

 

[merry_nbright]

I emailed Dave’s and they said if at the time of the request there is nothing I still hold onto the credits. Only if my request is filled is the voucher released

Don’t use points, book it as a cash reservation. Better availability and you’re not waiting for points.

 

[Galun]

I don't think it's a necessarily a Ponzi scheme. Sure you take money in from new reservations to fulfill old liabilities, but money is fungible. David's does not incur a loss unless 1). the owner keeps the 70% but David's does not get points back to re-rent, either because the points expire worthless (using banked points), or the owner tries to double dip; 2). the renter initiates a charge back and wins. In case 1, David's has only lost about 53% of the reservation cost since he keeps the 30% payment to owner and the commission. In case 2, he really just lost the commission, assuming he got the points back to re-rent. In all other situations, the math to both the owner and renter is eventually equal. Even if the renter made a cash reservation, the cash value is only the 70% paid to the owner. So if you can't find a discounted DVC room, he uses whatever he paid to the owner to book a cash room. So your voucher will have value.

I read somewhere that he had 2000 affected reservations. It's hard to say what percent is in case 1 and 2. In case 1 he loses $10.15 per point (70% already paid out to owner). In case 2 if the renter does a chargeback and wins, he loses $4.50 per point. Obviously we don't know what the exact percentages are, and how many points those reservations represent. But let's assume 100 points per reservation and he take a loss on 20% of the reservations - on 10% he loses $10.15, on the other 10% he loses $4.50. His loss is around $260k. It's a blow but probably not fatal to the business. If 2.5 months of closure is 2000 reservations, he can generate over $4 million in commissions per year.

But he does have a cash flow problem immediately. He might be getting back a lot of points from owners willing to re-rent, but he may not be able to turn them into cash from future reservations, which means no commission revenue for him. Also, if he cannot re-rent the points, it can eventually become an additional loss like case 1 where the owner keeps the 70% with attached reservation. This is why he is also asking for cash back first, and re-rent points second - if he get the cash back from the owner then he has no risk of future loss if the points cannot be re-rented. This is also why he is offering the voucher instead of giving refunds - these reservation will still eventually happen, and thus there is no immediately cash outlay, and eventually he keeps the commission. If you take the voucher you are locked into making a reservation and thus generating a commission for him.

I think his voucher plan is quite reasonable. But personally I don't plan on using him again because I think the $4.50 cut he is taking is way too deep for the perceived safety to owners (or lack thereof).

 

[cmrdgrs]

When I asked about CC they asked a bunch of question and then passed me onto the insurance people. So I’m guessing the chargeback might not be available

Once you click accept on the voucher, IMO the new voucher agreement supersedes your old agreement with David's. It's possible that by clicking "accept" that you give up your right to your Insurance and chargeback by accepting the voucher.

I don't what the "best" way is to approach the chargeback. Maybe other can chime in with advice. To my knowledge no one has been through the entire process to see if a chargeback would be successful. That could take months.

 

[DisneyBB]

My family and I are talking about hitting accept on the voucher and trying to book again for next April for the BCV or BWV. We have enough of a credit that we won’t have to pay anything extra, I hope. Has anyone hit accept and tried to book again? We have rented the last five years from Dave’s. In those previous year everything worked out well.

Is the owner of the points unable to reschedule for you? That would be the better route.

 

[Maddiesmum03]

My family and I are talking about hitting accept on the voucher and trying to book again for next April for the BCV or BWV. We have enough of a credit that we won’t have to pay anything extra, I hope. Has anyone hit accept and tried to book again? We have rented the last five years from Dave’s. In those previous year everything worked out well.

David’s has my BWV points to rent right now ..... but you cannot book as far out as April yet, so if that is when you are thinking of going you have a while to decide what is you best way forward and still have the chance to book at the 11 month mark if you decide to go the voucher route.

 

[Sandisw]

Is the owner of the points unable to reschedule for you? That would be the better route.

Davids is no longer allowing owners to reschedule the renters, His options to owners are refund money or we decide to rent your points again to whoever we want so we can get money to hopefully use toward your renters voucher

 

[Dracula]

Well, it seems that Disney is delaying point expiration:

"We know that some Members had reservations for Disney Vacation Club resort stays during the closure period using points that are set to expire. 2019 Use Year points for April and June that are set to expire in 2020 and that were used for these reservations will be extended for one year from the current expiration date. 2018 Use Year points for April and June that were banked into 2019 and used for these reservations will be extended for six months from their current expiration date. Please note this temporary policy only includes expiring points that were used to book a stay between March 12 and the end of the closure period and that involve a reservation cancelled after February 29. In addition, to better support Member availability, Disney Vacation Club will not extend the life of our expiring developer points.

In light of this and to help with resort availability in the coming year, beginning today Members who want to borrow points to complete a reservation will temporarily only be able to borrow up to 50 percent of their future Use Year points per contract, as permitted by your Home Rules and Regulations. Doing this will help manage inventory and accommodate more Members who want to schedule their vacations once the resorts reopen. Points already borrowed for a stay outside the closure period will be honored, even if they are above the 50 percent threshold. We will continue to monitor our inventory and re-evaluate, with the goal of returning to our standard policy as soon as it is appropriate to do so.

Finally, some Members have had questions about how the closure is affecting their association’s annual dues. While lower operating costs are anticipated for each condominium association because of the closures, there are many unknowns ahead as the resorts return to operation. Our commitment to Guest and Cast safety remains our top priority, and changes may be implemented to the way we operate, which may add some new costs. Given the unique circumstances of this situation, the proposal is to issue a credit to Members in mid-December as part of the distribution of Annual Dues Statements for 2021 if their association has an operating surplus (as opposed to rolling all surpluses into reserves)."

 

[ScubaCat]

Davids is no longer allowing owners to reschedule the renters, His options to owners are refund money or we decide to rent your points again to whoever we want so we can get money to hopefully use toward your renters voucher

I'd refund it........ as soon as the renter confirms that she got HER money back first.

 

[Grumpy by Birth]

i.e., If no owner wants to do business with me, or I can't find you a reservation for your requested dates, you get...nothing.

 

[Dracula]

I'd refund it........ as soon as the renter confirms that she got HER money back first.

Looks like owners with August points are out of luck - will get points back, but only 2 months left to make reservations, June and July 2020, with spotty availability.

 

[Grumpy by Birth]

Well, it seems that Disney is delaying point expiration:

"We know that some Members had reservations for Disney Vacation Club resort stays during the closure period using points that are set to expire. 2019 Use Year points for April and June that are set to expire in 2020 and that were used for these reservations will be extended for one year from the current expiration date. 2018 Use Year points for April and June that were banked into 2019 and used for these reservations will be extended for six months from their current expiration date. Please note this temporary policy only includes expiring points that were used to book a stay between March 12 and the end of the closure period and that involve a reservation cancelled after February 29. In addition, to better support Member availability, Disney Vacation Club will not extend the life of our expiring developer points.

In light of this and to help with resort availability in the coming year, beginning today Members who want to borrow points to complete a reservation will temporarily only be able to borrow up to 50 percent of their future Use Year points per contract, as permitted by your Home Rules and Regulations. Doing this will help manage inventory and accommodate more Members who want to schedule their vacations once the resorts reopen. Points already borrowed for a stay outside the closure period will be honored, even if they are above the 50 percent threshold. We will continue to monitor our inventory and re-evaluate, with the goal of returning to our standard policy as soon as it is appropriate to do so.

Finally, some Members have had questions about how the closure is affecting their association’s annual dues. While lower operating costs are anticipated for each condominium association because of the closures, there are many unknowns ahead as the resorts return to operation. Our commitment to Guest and Cast safety remains our top priority, and changes may be implemented to the way we operate, which may add some new costs. Given the unique circumstances of this situation, the proposal is to issue a credit to Members in mid-December as part of the distribution of Annual Dues Statements for 2021 if their association has an operating surplus (as opposed to rolling all surpluses into reserves)."

Just saw that notification on DVC page. This is HUGE news! I haven't had time to really absorb and analyze this, but it appears to prevent a lot of owners from losing points and balances that with future borrowing restrictions (albeit not eliminating borrowing altogether), which many here have predicted.

ETA: E-mail with this notification also just hit my inbox. Of note, it says "to help with resort availability in the coming year" so I assume that's how long they plan to limit borrowing (at least initially, I wonder if it might get extended?).

 

[momincolorado]

When I asked about CC they asked a bunch of question and then passed me onto the insurance people. So I’m guessing the chargeback might not be available

I have insurance of up to $10k on the Sapphire Reserve but the voucher complicates the insurance route. For this reason, chargeback is a better option. I would call your credit card issuer back, explain to the CSR that you are doing a chargeback and ask to speak to someone who will have some answers for you as to how to proceed (each issuer is different).

If you really want the voucher, I would also speak to an attorney before clicking “Accept” - someone in your friends or family circle perhaps or a friend of a friend who can take a quick look at the contract in place as well as the voucher T&Cs and advise you accordingly.

As a side note, Disney has not announced re-opening dates (we all hope it’s June 1 but it’s possible that it will be later) and the longer the closure the less revenue this company will be pulling in and there appears to be very little (if anything) in reserves. Even after re-opening, new renters may be harder to come by - parks may be closed or operating at limited capacity and Disney is likely to release attractive discounts. David’s supply chain will also be affected; AFAIK, this is the only broker out there that is asking/demanding money back from the owners. All of these factors will affect the likelihood of the voucher implementation going forward.

 

[cmrdgrs]

Looks like owners with August points are out of luck - will get points back, but only 2 months left to make reservations, June and July 2020, with spotty availability.

Yes. All of my contracts are August UYs. I have 611 points currently at risk.

 

[Dracula]

Yes. All of my contracts are August UYs. I have 611 points currently at risk.

That's very unfortunate. If you have direct renters, maybe you can still get them rescheduled for June / July. If reservations are through David, maybe you can keep the 70%.

 

[ScubaCat]

Looks like owners with August points are out of luck - will get points back, but only 2 months left to make reservations, June and July 2020, with spotty availability.

Not necessarily - see the new DVC policy just posted on the member site. I'm sure there will be discussion in another thread on the specifics, but the points will be extended.