DVC loan interest rates

[tx911]

Thank goodness for folks willing and able to finance their DVC contracts! Without that majority of buyers, DVD couldn't exist as it does today, building shiny new resorts that we all love and adore. Those things are built and sold on the back of consumer debt. I have no hard data, but I am willing to bet a lot of Mickey premium bars that the majority of contracts purchased from DVD are financed.

I would go even further, again without any real DIsboards evidence (as is so often requested) that many of the most vocal "if you have to finance a timeshare, then you can't afford it" voices probably financed their purchase.

There are some who would use that same "if you have to finance, you can't afford it" argument when it comes to buying a car.

 

[heynowirv]

When I was buying the DVC rate was 10% for 5 years , And I chose a personal loan at 6% for 3 years but it was when you could get a mortgage for 3% so I guess it is still in line. Basically everything is 3% higher.

Pre Covid.We bought our beach home in 2019 and our mortgage rate is 3.25%.

 

[heynowirv]

There are some who would use that same "if you have to finance, you can't afford it" argument when it comes to buying a car.

Being older and retired, yea we're in both boats.WE haven't needed loans for our last 3 cars or last 2 DVC contracts. Our kids are grown up and our primary home is paid off. It really depends on where you are in life.

 

[Girlstar30]

Thank goodness for folks willing and able to finance their DVC contracts! Without that majority of buyers, DVD couldn't exist as it does today, building shiny new resorts that we all love and adore. Those things are built and sold on the back of consumer debt. I have no hard data, but I am willing to bet a lot of Mickey premium bars that the majority of contracts purchased from DVD are financed.

I would go even further, again without any real DIsboards evidence (as is so often requested) that many of the most vocal "if you have to finance a timeshare, then you can't afford it" voices probably financed their purchase.

I agree. We are all adults and dont need people lecturing us whether we can afford something or not. It's very pretentious and misinformed for people to tell someone what they should and shouldn't do if they dont know the whole picture. Except yes if someone is financing direct for 15 years they need to run the math because they are probably paying more than just renting.

 

[Girlstar30]

There are some who would use that same "if you have to finance, you can't afford it" argument when it comes to buying a car.

Exactly so their solution is for someone to ride a bus? Id rather finance a car at 15% for 6 years if I had to than the ride the bus. Idc how much im spending lol.

Even though a car is way more necessary (especially in southern california) and DVC isnt, People will think the same for dvc, they'd rather have it than not.

 

[davidhr]

There’s no doubt that the “best” financial decision is not to finance a timeshare. I’d even say for the overwhelming majority of people, buying a timeshare is not a good financial decision.

But I have a good friend who says that life is short and would be too boring if we only make the optimal financial decisions every time. Sometimes you have to treat yourself (responsibly). If financing isn’t going to break your life, go for it.

 

[Girlstar30]

There’s no doubt that the “best” financial decision is not to finance a timeshare. I’d even say for the overwhelming majority of people, buying a timeshare is not a good financial decision.

But I have a good friend who says that life is short and would be too boring if we only make the optimal financial decisions every time. Sometimes you have to treat yourself (responsibly). If financing isn’t going to break your life, go for it.

I know sometimes these posts make me laugh because the best financial decision would be for none of us to have a depreciating asset going to zero.

But ofc we want it and rightfully so, my memories with my wife and family are worth more than gold

 

[BeachClub2014]

I agree. We are all adults and dont need people lecturing us whether we can afford something or not. It's very pretentious and misinformed for people to tell someone what they should and shouldn't do if they dont know the whole picture. Except yes if someone is financing direct for 15 years they need to run the math because they are probably paying more than just renting.

Maybe. Probably. Who knows? For every "luxury" purpose, there is a less expensive alternative. But that's not the dream, right? There are a gazillion ways "to do" WDW other than DVC, whether renting or owning. I mean, let's be honest, a studio "villa" is a glorified hotel room at a premium price. You can find much cheaper, and just as nice, hotel rooms as studios. When you buy DVC, you buy the dream.

There's also context to consider. A Class C RV can cost well over $100K and can be financed for 20 years. Seven-year vehicle loans are now available. Student loans can take decades to repay. Whether someone should do any of these things can be argued, but within this context, a 15-year loan on DVC isn't really out of whack.

 

[tx911]

Exactly so their solution is for someone to ride a bus? Id rather finance a car at 15% for 6 years if I had to than the ride the bus. Idc how much im spending lol.

Even though a car is way more necessary (especially in southern california) and DVC isnt, People will think the same for dvc, they'd rather have it than not.

No judgement here!

I will say, there is nothing that will make you drive a car until the wheels fall off more effectively than the prospect of having to lay down $50-100K in one fell swoop!

 

[Girlstar30]

Maybe. Probably. Who knows? For every "luxury" purpose, there is a less expensive alternative. But that's not the dream, right? There are a gazillion ways "to do" WDW other than DVC, whether renting or owning. I mean, let's be honest, a studio "villa" is a glorified hotel room at a premium price. You can find much cheaper, and just as nice, hotel rooms as studios. When you buy DVC, you buy the dream.

There's also context to consider. A Class C RV can cost well over $100K and can be financed for 20 years. Seven-year vehicle loans are now available. Student loans can take decades to repay. Whether someone should do any of these things can be argued, but within this context, a 15-year loan on DVC isn't really out of whack.

A 15 year loan at 15.9%, which is around what they offer around if you dont qualify for 8.99%, is $47,000 of interest over the life of the contract.

How is that buying into the dream? Unless you think lounges and moonlight magic are worth $47,000 dollars plus annual maint fees, this is insane. That is more than the actual direct contract. Far more.

With financing resale you can still be a member and save money. With an rv or student loans its not about saving money. DvC is unless youre buying for membership extras only. I dont know anyone that does that. I mean if someone wants to pay that and justify it for membership extras then its their money, but wow.

I would bet that most people that do this do not understand how much theyre paying in interest over the life of the contract and don't know that renting points from someone else is an option.

You can rent points to stay at dvc hotels And not spend near $77,000 on a direct contract plus maintenance fees every year.

 

[Sandisw]

I think it's one of those things where, we all know that, if we have to finance, it probably doesn't make sense to purchase DVC. And if you share on these boards that you're financing (particularly at 10% interest rates or more), people will generally advise against it. But, if you can talk yourself into DVC making sense without any financing, then it doesn't take much more rationalization to talk yourself into financing and/or telling yourself you'll pay it off quickly, so the interest charges won't be all that significant. There are also alternate ways to finance these purchases other than through DVC - play the 0% promo balance transfer game on credit cards, home equity loans, 401k loans are a few that come to mind. Sharing details about some of those things can get to be a bit much for an anonymous discussion board.

Not everyone believes you have to pay cash and weneed to be sure not to make others who choose a different way to attain DVC as a right or wrong issue.

Definitely important to share pros and cons of choosing financing, but in the end, if financing works for someone, then it’s the right choice for them.

 

[Girlstar30]

No judgement here!

I will say, there is nothing that will make you drive a car until the wheels fall off more effectively than the prospect of having to lay down $50-100K in one fell swoop!

No offense taken, ive never paid that, but I would if it came down to that or the bus, I need the car to go places, public transportation here is not viable (and scary )

 

[squeezeplay101]

I love DVC and have been a member 20+ years, BUT the news that DVC is offering a 15 year loan at 12.5% is a total rip off in my opinion. You can get it down to 12% with direct deposit

To buy a DVC contract, you need some deposit and there is tremendous value in the product and for DVC to be so greedy and not to offer something like 7% is absurd. The extra 5% is a killer for many buyers and they should really stand behind their product and offer a much more reasonable interest rate.

Yowza. That is steep interest. Not surprised though. Home equity loans are astronomical these days as well, even with great credit. That said, I couldn't advise folks to take these kinda loans for discretionary purchases such as DVC. I love being a part of DVC, but carrying that kind of interest is just too much.

 

[BeachClub2014]

A 15 year loan at 15.9%, which is what they offer around if you dont qualify for 8.99%, is $47,000 of interest over the life of the contract.

I didn't say that financing for 15 years was a great deal in any way, shape, or form. What I have said is that this type of financing isn't outside the norm.

How is that buying into the dream? Unless you think lounges and moonlight magic are worth $47,000 dollars plus annual maint fees, this is insane. That is more than the actual direct contract. Far more.

Thank goodness DVC can sell people on this dream, or they wouldn't be able to sell points directly and build new resorts. That's my entire point. We ALL need people willing to finance their DVC purchase, or there would be a ton fewer purchases, and by extension, fewer resorts.

With financing resale you can still be a member and save money. With an rv or student loans its not about saving money. DvC is unless youre buying for membership benefits only. I dont know anyone that does that. You can rent points to stay at dvc hotels And not spend near $77,000 on a direct contract plus maintenance fees every year.

As I mentioned earlier, there are numerous ways to visit WDW more affordably, other than buying (or renting) DVC and financing, but that's a different discussion.

 

[Girlstar30]

I didn't say that financing for 15 years was a great deal in any way, shape, or form. What I have said is that this type of financing isn't outside the norm.


Thank goodness DVC can sell people on this dream, or they wouldn't be able to sell points directly and build new resorts. That's my entire point. We ALL need people willing to finance their DVC purchase, or there would be a ton fewer purchases, and by extension, fewer resorts.


As I mentioned earlier, there are numerous ways to visit WDW more affordably, other than buying (or renting) DVC and financing, but that's a different discussion.

I have said since the beginning of this thread the whole time that people do this and make unwise financial decisions and that isnt outside of the norm and have given various examples of people i know that do this, we agree with the fact that people do this.

I financed my resale purchases and dont try to lie or hide it and have posted that i am in these threads. It's nothing to be ashamed of. I am saving a ton of money by doing this vs other methods.

You replied to me and said maybe, probably who knows when i said that people are probably are not saving by doing this. They are definetely not saving by doing this and you can do the calculations and know lol.

If you were being sarcastic and trying to say that people dont care and thats what they're telling themselves then yes i have been saying that this whole time lol so i guess i really dont understand why you are responding with other things that i agree with and have been saying.

 

[BeachClub2014]

You replied to me and said maybe, probably who knows when i said that people are probably are not saving by doing this. They are definetely not saving by doing this and you can do the calculations and know lol.

Ah, now I see where we may have a disconnect. I wasn't debating your statement relative to overall cost. I agree that financing DVC will not likely ever be the least expensive way to do either DVC or WDW. That's one of my main points: for many (if not most) people who buy DVC, it isn't about doing WDW or DVC in the cheapest possible way; it's about pixie dust and living (or buying) the dream.

 

[Girlstar30]

Ah, now I see where we may have a disconnect. I wasn't debating your statement relative to overall cost. I agree that financing DVC will not likely ever be the least expensive way to do either DVC or WDW. That's one of my main points: for many (if not most) people who buy DVC, it isn't about doing WDW or DVC in the cheapest possible way; it's about pixie dust and living (or buying) the dream.

Agreed! And if they want to then its their $$$

 

[Girlstar30]

Yowza. That is steep interest. Not surprised though. Home equity loans are astronomical these days as well, even with great credit. That said, I couldn't advise folks to take these kinda loans for discretionary purchases such as DVC. I love being a part of DVC, but carrying that kind of interest is just too much.

Yes it insanity and makes no sense to do and is why I wont buy direct until I save more money and qualify for the lowest rate possible.

 

[BeachClub2014]

If you were being sarcastic and trying to say that people dont care and thats what they're telling themselves then yes i have been saying that this whole time lol so i guess i really dont understand why you are responding with other things that i agree with and have been saying.

No sarcasm from me, and I will move on.