Does this seem right?

[nakedbear]

Just started the purchase of 160 points at okw with an August UY for 70 a point. All 160 points will be available in August 04 with 33 banked points from 2003. We are paying closing costs plus the the full dues from 2003. Should I have paid prorated dues? Or the fact that I am getting 160 points in August means that I am paying correctly? I'm confused since the contract says dues for 2003 and I am only getting 33 points from that year. Since dues are due in January are we paying for our use year or the current year, I am so confused. Just checking my work here. Thanks for all your help!

 

[jez4100]

We bought resale and was told that you only reimburse for dues from this year. You do not pay on banked points. We were relieved as we had 150 points banked and 150 already available.

 

[tjkraz]

Unless I'm mistaken, handling of past years dues in a resale is compleletly negotiable. So, if you're already committed to those terms, you're probably stuck with it. If you haven't finalized the agreements yet, you might want to go back to the table and renegotiate that point.

 

[Dean]

Originally posted by nakedbear
Just started the purchase of 160 points at okw with an August UY for 70 a point. All 160 points will be available in August 04 with 33 banked points from 2003. We are paying closing costs plus the the full dues from 2003. Should I have paid prorated dues? Or the fact that I am getting 160 points in August means that I am paying correctly? I'm confused since the contract says dues for 2003 and I am only getting 33 points from that year. Since dues are due in January are we paying for our use year or the current year, I am so confused. Just checking my work here. Thanks for all your help!

You will have to pay for what you agreed to pay for in the contract. I'm not sure exactly how many points we're talking, as your post is confusing me.


First, the basics. DVC charges dues on a calendar year basis. Most resale agents, wrongly I will add, subscribe to the "if you get the points, you pay the dues" theory. Banked or expiring points have value but may have less value than other points. I'm actually going to give you several scenarios, assume 160 August 2004 points and 33 banked points. Wiith these assumptions, the most fair and reasonable dues reimbursement for you would have been 5 months of 2004 dues plus/minus a little extra. MOST resalers would have expected you to pay the full 2004 dues, but no extra.

I suspect you are just paying the 2004 dues which were due tis past January. If indeed you are paying 2003 plus 2004, you are overpaying by some $6 pp and I'd guess that makes this not a good deal. You might try copying the wording from DVC about dues being calendar year and not use year and see if you can get out of the appropriate part. If not, you will be paying double dues for a portion of the points. Not that bad if you're only paying the 2004 dues though.

This is one of the benefits inbuying from DVC as they do prorate the points far better than most resales. Having said that, on the 3 contracts I bought, I did pay the lower dues amount.

 

[JimC]

A resale contract is just like any other real estate transaction. All is negotiable. Dues run on a calendar year. Points on a use year.

Some believe you should adjust maintenance fees to the points you are getting on the contract. Not sure why, but it appears to be a common approach. Others say to prorate it based on the closing date (similar to real estate taxes when you purchased your home). If you purchase direct from Disney, they do it based on the agreement date and not the closing date.

It is really up to the parties and what they want to negotiate. My view is that you pay what you believe is fair value for the contract you are buying. What is the cost per point over the total number of points over the remaining years of the contract?

 

[bobbiwoz]

We didn't pay any of the dues on the banked points (88) on a resale we recently bought. However, this is something that is negotiated, there is no set standard. The '04 dues covers the points for the '04 calendar year, they are due in Jan. or February, there is a "grace period." They are due then, no matter when in '04 you get your points. Call your agent to clarify what you are paying.

Bobbi

 

[CarolMN]

For resale, everything is negotiable. If you think the overall deal (total price) was good, then it is a good deal.

Dues are paid by calendar year - they really have nothing to do with use year. When you buy from Disney, you pay a prorated share of the first year of dues. For example, if you bought in July, you'd pay 1/2 of the years dues, no matter which use year you chose. (There are slightly different prorate rules for SSR due to the fact that you may not be able to use your membership until the building you purchased is ready for occupancy).

In general, I would not pay any dues for a past calendar year . However, $70 per point plus dues and closing seems to be a good price.

Add the closing costs, the 2003 dues and 1/2 the 2004 dues. Then divide by 160. The result can be compared to Disney's price. (My quick estimate says this will add about $9 per point to the cost, making your overall cost ~ $79/point. I allowed $4/point for maintenance and $500 for closing).

Believe Disney is selling points for the sold out resorts (when they have them) for $84. Are you still happy? If so, you got a good deal - especially if you are buying your first choice of home resort.

Best wishes -

 

[Dean]

Originally posted by bobbiwoz
We didn't pay any of the dues on the banked points (88) on a resale we recently bought. However, this is something that is negotiated, there is no set standard. The '04 dues covers the points for the '04 calendar year, they are due in Jan. or February, there is a "grace period." They are due then, no matter when in '04 you get your points. Call your agent to clarify what you are paying.

Bobbi

To clarify, the dues on this contract dues in Jan were for 7 months of the 2003 points and 5 months of the 2004 points. That's what it means when it says Calendar year, not use year. It's not a statement of when you pay it but rather a statement of what it covers.

 

[nakedbear]

Wow! I think I have confused some of you and now I have confused myself more! LOL! I think I understand though. I am only reimbursing one year of fees. The contract says they are for 2003, although they must really be for 2004 since the original owners would have paid this past January which would have been in their 2003 UY even though the actual year is 2004. Since I won't have to pay dues til January 2005, I am just paying for the use of the points (160) that I will be getting in August 2004 and will be getting the bonus of 33 points from 2003. The contract is just using UY terminology, eve though the original owners actually paid in 2004. If I had a UY in February I guess it would make more sense to me. If I wasn't getting any points in the actual calendar year of 2004, I would have balked at the deal. It's a done deal anyway(unless we don't pass ROFR), just wanted your clarifications! Thanks for all your great responses!