DVC Financing

[LJERRY]

Short and sweet - can you refinance your loan to a lower interest rate? We are at 14.25% and have good credit, but we weren't sure if this is somehting that Disney Vacation Development, Inc. would do? At the time that we purchased, we were told by our guide that everyone was getting 14.25% because of the economy and restrictions on lenders. True? I don't know, but my girlfriend and her husband who are well off and have great credit as well received 14.25% on their DVC purchase a month after us, so, I don't know. I am just trimming fat on all of our monthly expenses and was curious. Thanks in advance for your input!

 

[arthur06]

I don't believe you can with DVC. You could go to your local bank and get a personal loan or a HELOC loan if you so choose.

 

[tjkraz]

The typical rate today is around 10.75% for those with good credit and 14.75% for those with lower scores. It's possible that Disney offered the 14.75% rate to all for a period when credit markets were particularly bad. I couldn't say one way or the other with complete certainty.

You could call DVC and ask about refinancing. Not sure if they would do it, though, since there is no incentive on their part. Best alternative may be a home equity loan which often runs in the neighborhood of 5% these days.

 

[Crystal_27]

I can't imagine that DVC would willingly refinance your contract (there really isn't any incentive there for them to do so - they are making *bank* on the higher interest rate). That said, you may be able to secure a private loan through another source and payoff your DVC loan. Still, I really am speculating, so a call to MS would probably be your best bet. Good luck!

 

[jlewisinsyr]

I am not aware of any time that DVC defaulted all buyers to the higher "standard" rate. They did raise their standards though, pushing more people into the standard rate. I know when we bought standard was pretty much any credit score below a 740 where prior to recession they were securing people with high 600 scores in preferred financing.

I doubt DVC will refinance the loan for a couple of reasons. A) There is no contractual obligation for them to do so. B) They are locked into a rate in terms of raising it, why would they want to lower it (refer to A).

 

[sweetdana]

Due to costs of redoing title (needed for foreclosure if required.) There is no chance they would. You would need a new contract, meaning the old one is void, meaning there lien on title is void. You would spend more on closing costs than you would ever save on interest. 15K at 3% is still only 450$ a year. This is a tough break even at 30 - 40$ a month.

If you owe less than 75% on your home look at taking out up to 80% on a 1st mortgage or 85% with a second (total loan to value.) With rated on 30 yr fixed 1st mortgages in the mid to lower mid 5s. . .. equity would save you 10%. I think even a signature loan at a local bank should be under 10%, with assets in the bank. If you are limited on equity and don't have reserve assets exceeding the amount you want... stay put.