DVC and Bankruptcy

[muscarello4]

HELP! Long story short. We are renting DVC points from family friends. We have a reservation at BLT for 12/18-12/24. We have given them an $800 deposit and planned on paying the balance in May and June. The total rental is a bit over $2500.

I found out today that they have filed for bankruptcy. I feel like I have two options.

#1 - bail and ask for my deposit back. (Granted, they will probably have to pay me back over a while....that is why they filed for bankruptcy.)

#2 - keep the reservation, but insist that I pay them in cash when we check in to the resort. (They will be there too. No idea how...they have no money, but that is beside the point.)

I'm worried about them paying their loan and maintenance fees between now and December. Not to mention, won't a bankruptcy take their DVC contract?

WWYD - #1 or #2

Thanks for the input!

 

[Sandisw]

Honestly, at this point, I would cancel and ask them to give you back your deposit. Be aware that you may have a hard time ever getting it.

I am sorry that they are going through things, but with that reservation so far into the future, there is no telling what could happen that puts a hold on the DVC account.

If you simply hold out and wait and then a week before you go, find out that there is no more reservation, you could be out of luck securing something else.

I hope things work out for both of you.

 

[sweetdana]

Agree 100% with Sandi, if you found out after airfare, dining, tickets are booked and paid for.. that the ressie is gone, through BK, or missing MF, or what every.. you will be upset. (Well founded.)

If it is a close family friend, maybe even offer a 100$ - 200$ fee for there time, to try and save the friendship, but cancel the ressie.

I am so sorry.

 

[Kupiecb]

Do you know what kind of Bankruptcy they filed? If it is chapter 13 they still may be able to Keep their membership.

 

[CarolAnnC]

Or, DVC can be considered an asset and liquidated to pay off the bankruptcy. I would try to get my money back...

 

[Crystal_27]

You should cancel your reservation and have them give you your money back. Since they have actually filed, their assets are now in the hands of the court-appointed trustee. Your friends may want to keep their DVC, but if the trustee determines that its in the best interest of the estate, the decision will be out of their hands and their DVC will be sold. You really don't want to get yourself (and your vacation) in the middle of this situation - - things like this never end well. For what it's worth, there are some pretty good room discounts on DVC villas through CRO right now. Good luck!

 

[Ln42]

I would be very concerned as well. Personally, I would not keep the reservation, I would cancel and try to rent or book it elsewhere.


Good luck with your decision.

 

[STLDisney_Freak]

Are you sure that they filed the papers already? You can ask for your deposit money back and if the papers aren't filed yet then they can just add you on the papers. Then there is no money for you. That is a tough pickle to be in.

 

[marynvince]

I would hope they feel bad and will try to make things right with you. It's one thing not to pay a creditor with whom you have no personal relationship, It's another thing entirely to "screw" a friend. Perhaps talking to them will help in your decision. Maybe you can buy there DVC membership from them. Good Luck

 

[Coach81]

Yikes.. beware renters...

 

[drusba]

If they have filed for bankruptcy, you have issues. One, you may not even be able to get your money back if you cancel -- assuming the money you paid was just deposited into their general banking account, they cannot just pay you without bankruptcy court approval; you are now one of many unsecured creditors of the bankruptcy estate who has to make a claim in the bankruptcy court to get any money and unsecured creditors often end up getting little or nothing; in fact under the automatic stay of claims in bankruptcy you may be prohibited from even asking them to give you the money back outside of the bankruptcy proceeding. Two, once Disney is informed of the bankruptcy it may cancel the reservation. Three, the DVC interest may be sold as part of the bankruptcy.

 

[saintstickets]

Here is my 2 cents on the matter (and that is about all it is worth!), if they have already filed for bankruptcy protection, the odds are, they do not have the cash to reimburse you your deposit. You can cancel your reservation and strongly urge them to pay you back now. However, the court might come back later and MAKE you pay that back. Yes, they can do that (voice of experience here after I collected monies due me). It is worth the risk to try and get it back now though because as the proceedings go forth, the odds are that you will not get it back later. If they tell you they do not have the funds to reimburse you the deposit, then file a claim with the bankruptcy court as a creditor. Once the proceedings are complete (could be years), you might be able to recover some of the deposit but ONLY if you have filed a claim.

Here is another long shot option...if they do not reimburse you the deposit, get them to transfer the required points to another members account and make a reservation with another, trusted member. You will owe the balance for the total points so make sure they are transfered before you pay up but at least you will have the points in a DVC member's account that you can trust. Even if the bankruptcy court seizes their DVC contract to liquidate, the points are in another account and not reachable for the court. Just a thought. Good luck.

 

[nunzia]

...and did you say that they were planning on being there with you? They've claimed bankruptcy and are still planning a Disney vacation with points they will probably not even have? It doesn't sound like they've learned alot from this experience. I'd cancel right away, try and get your money back, and then plan your own vacation.

 

[muscarello4]

I appreciate all of the input. We are going to go with option #1. We haven't talked to them yet. We found out through a reliable third party. We have left several messages. I think they know why we are calling and are avoiding us. That's okay. I am persistent.

What a crock! Renters.....please BEWARE! These are CLOSE family friends. You just never know. It is an awful lot of money to be out. I will choose to never rent again. I can't handle the thought of losing out on all of that money and having no recourse. I really hope that I get that money back!

 

[Brian Noble]

I think it's best to prepare yourself for the possibility that that $800 is gone. If they are truly close friends, I would just send them a note saying you've heard they are going through some difficult times, and you're sorry to hear it, but you think it is best to terminate the agreement. Acknowledge that you understand they may not be able to pay your deposit back. If they aren't super close, then the letter could be less sympathetic and more a straightforward cancelation with a request for a return of the deposit.

You have to decide if the $800 is worth the friendship. You could be more aggressive about it, and file as a creditor, but for this amount, it's probably not worth it in terms of your time and further expenses. If you have legal coverage as a benefit through work (I do), it might be worth getting a consultation. Otherwise, you can very quickly spend more in fees than you'd ever hope to recover.

While I understand your desire to never rent again, I would not let this experience deter you permanently. Let's suppose you rent from someone else, and just add this $800 to your total cost. I'm guessing you'll still be well under the price for that room that Disney would want. This is just one of the risks that renters take in exchange for getting a significant discount on their lodging.

One more thought: if you had purchased trip insurance prior to the bankruptcy filing *and* you had a contract with the "landlord", you might be able to file a claim for the deposit.

 

[rhonimouse]

here is a thought, possibly ask for (and hopefully get) your deposit back and instead of spending $2500 for rental for the week...make it a deposit on your own DVC contract and enjoy! We are still 8 months out from your trip so you should still be able to find availability on those dates....

 

[muscarello4]

I would love DVC. Hubby is very disinterested in the mouse. We have been 10 times in 10 years. The time to buy would have been 10 years ago in 2000 during our first trip. Of course, there was NO money to buy then. (Hindsight is always 20/20, right?)

I could continue to go to Disney annually forever. Hubby is truly hoping that this is our last trip. He is of the train, "There is so much more to see than Disney" and I am, "If it ain't broke (the kids love it), don't fix it!"

He'll probably win on this one. I have been on these boards since 2003, reading MUCH more than posting. So many great people on here who "get it". I love Disney!

BTW - We won our tickets for our Disney trip...$2000, baby! I can chalk the $800 off as a loss. It still burns me, but we'll be just fine.

 

[ToddyLu]

That is so cool winning a trip....God works in mysterious ways. Take care and enjoy your trip.

 

[Dean]

As noted, it's unlikely they could legally pay you back until the bankruptcy is settled. There's also a good chance you will not be able to use the reservation even if they still own DVC in Dec because if they are behind on fees or payments they will not be in good standing and DVC will lock you out. Your best bet might be to try to make a trip much sooner, while points are still usable, otherwise you're likely out the $800.

 

[nunzia]

If these are close family friends can't they at least offer to barter back your deposit if they can't pay it? babysitting..etc?