DVC T &C Personal Use - Only Thread to Discuss.

[Cyberc1978]

I think most LLCs are not big guys, they are little guys with the $100 / $125 each to file their LLCs

More likely to fold and move on to the next easy money project

I don’t understand the reasoning behind having a LLC vs not having it.

What are the pro and cons to having your DVC in a LLC?

 

[Mouseforward]

I don’t understand the reasoning behind having a LLC vs not having it.

What are the pro and cons to having your DVC in a LLC?

I have a very unpopular opinion,

One legit reason is some trusts use them ( or at least I’m told) I never got that far my family attorney is not a big fan of putting timeshares in trusts although a paid off Disney is probably the one exception

I think the real reason is to skirt the system. concealing the ownership. Let’s face it. There’s no real liability concerns, which is the other reason people form LLCs.

But possibly other people know of good reasons.

 

[Kingkonig]

I have a very unpopular opinion,

One legit reason is some trusts use them ( or at least I’m told) I never got that far my family attorney is not a big fan of putting timeshares in trusts although a paid off Disney is probably the one exception

I think the real reason is to skirt the system. concealing the ownership. Let’s face it. There’s no real liability concerns, which is the other reason people form LLCs.

But possibly other people know of good reasons.

There are some good reasons, and if people already had a trust set up for shared assets it could make sense to just add the contracts to the trust. Setting up a trust specifically to hold DVC through….unless you’re later in life and bought it specifically for a beneficiary I’d be wary of “good intentions”

 

[Mouseforward]

There are some good reasons, and if people already had a trust set up for shared assets it could make sense to just add the contracts to the trust. Setting up a trust specifically to hold DVC through….unless you’re later in life and bought it specifically for a beneficiary I’d be wary of “good intentions”

So your example, if I want to split a DVC account with my buddy Joey Walnuts that could possibly be a reason for an LLC.

 

[mkatsy]

I'll flip the script.

DVC might only go after the family DVC member. It is after all, that very same group of members complaining to DVC. That group is fragmented and less likely to fight a DVC decision. By going after a few from that group, the others within it are likely to "back off" and stop pushing back against DVC decisions and almost certainly going to stop complaining to DVC about commercial owners.

Whereas the commercial owner group is not fragmented. They are organized into LLC entities with attorneys on retainer. They are far more versed in the laws, rules and nuances than the family owner. They are far more likely to engage legal means to halt DVC from taking action. They probably have deeper pockets to dedicate to a protracted battle with DVC. Sure, not as deep as DVC but deeper than the fragmented family group.

DVC might just pick a fight with the weaker opponent knowing it will kill two birds with a single stone.

Just playing devils advocate for a moment.

That would be disappointing, and honestly would remind me of how Blackrock buys up residential real estate and the little guy suffers.

 

[Kingkonig]

So your example, if I want to split a DVC account with my buddy Joey Walnuts that could possibly be a reason for an LLC.

Potentially! I do find it entertaining how some people would possibly have a timeshare of a timeshare, but it should be completely possible to do so. Just complicated bylaws of the LLC.

 

[Mouseforward]

Potentially! I do find it entertaining how some people would possibly have a timeshare of a timeshare, but it should be completely possible to do so. Just complicated bylaws of the LLC.

I mean, if you boil it down, it would be a share of a share of a lease. Like 20 year-olds in Manhattan

 

[VGCgroupie]

Thank you, I’ll take a look at that thread. My husband pointed out to me that those contracts don’t come with title insurance and if you did win a bid, it would probably be because the professionals let you, and not in a good way. Also, I see absolutely no way to tell how many points are banked/borrowed. but I do understand now why it takes almost three weeks for member services to load my points, all these contracts are in line too. …. Oh and the other thing is that the auction is at 11am and you have to pay in full by 2 pm so not very convenient if you are at work. And the last piece is that if the contract sells for more than the debt on the contract is, a refund is due. The foreclosure trustee doesn’t keep that money, they pay out the bills and then return the overage to the original owner (the person who defaulted). However, sometimes that person has died, or has stopped taking calls about the timeshare. In that case, the new owner gets the money, but you need an attorney for that. The LLC go to court (you can see it on the county clerk website) and petition the foreclosure trustee for a refund. After the court does a due diligence process to reach that original owner, the LLC gets a refund. I can’t do that without hiring someone and that defeats the whole purpose of saving money and makes more work for me.

Yeah that was same for me. Just didn’t seem worth the risk when I’d be going against Disney and LLCs.

Someone who bought at auction mentioned you don’t get any banked points. So that also made it a negative for me.

 

[VGCgroupie]

IDK because this part is getting over my head, but there is a lawsuit from an LLC to the foreclosure trustee because on one contract she didn’t pay the dues and they got a bill from Disney and they were seeking relief from the court. again, way out of my league. Later I’ll pull one of the upcoming auction listings, they have the docket number on them, and go look in the clerks website and see what fees are included in that price.

From my research which wasn’t extensive but rather just reading what those who have bought experienced was there could be money owed beyond what the judgment is for.

 

[VGCgroupie]

I don’t understand the reasoning behind having a LLC vs not having it.

What are the pro and cons to having your DVC in a LLC?

LLCs provide a level of protection from lawsuits and tax benefits. Also you only have one legal personal name but you can have 30 LLC names if you want. Edit to add same goes for trusts you can have many. They are more expensive and harder to setup than an LLC though. An LLC takes hardly any money and can be done easily even by a novice.

 

[VGCgroupie]

I'll flip the script.

DVC might only go after the family DVC member. It is after all, that very same group of members complaining to DVC. That group is fragmented and less likely to fight a DVC decision. By going after a few from that group, the others within it are likely to "back off" and stop pushing back against DVC decisions and almost certainly going to stop complaining to DVC about commercial owners.

Whereas the commercial owner group is not fragmented. They are organized into LLC entities with attorneys on retainer. They are far more versed in the laws, rules and nuances than the family owner. They are far more likely to engage legal means to halt DVC from taking action. They probably have deeper pockets to dedicate to a protracted battle with DVC. Sure, not as deep as DVC but deeper than the fragmented family group.

DVC might just pick a fight with the weaker opponent knowing it will kill two birds with a single stone.

Just playing devils advocate for a moment.

This one I disagree. Disney isn’t afraid of LLCs and their attorneys. They also in my opinion are not out to get the family, that is their customer base.

 

[Brianstl]

I have a very unpopular opinion,

One legit reason is some trusts use them ( or at least I’m told) I never got that far my family attorney is not a big fan of putting timeshares in trusts although a paid off Disney is probably the one exception

I think the real reason is to skirt the system. concealing the ownership. Let’s face it. There’s no real liability concerns, which is the other reason people form LLCs.

But possibly other people know of good reasons.

They used to be a great tool to get out of a never ending timeshares before most timeshare companies caught on and started making officers of the LLC agree to be responsible for the financial obligations of the LLC. I think the term used is a Viking Ship in reference to a Viking funeral.

In DVC they can be used to shield an owner from point owning limits, to skirt ROFR in a sale, dramatically speeds up the transfer of ownership because you are selling the LLC (not the DVC) and as a a way to keep direct buy status when selling a contract or contracts.

 

[HyperspaceMountainPilot]

From my research which wasn’t extensive but rather just reading what those who have bought experienced was there could be money owed beyond what the judgment is for.

This is outside my area of legal expertise (though I did take a few bankruptcy law courses)—my layman’s guess is that the judgement is what was owed at (or somewhat before) the time foreclosure proceedings originated, and the additional money owed could be subsequent dues and interest (and possibly any fees Disney spent to collect after that, depending on their contract rights)— I assume they can ask for all that before letting you book new reservations on the contract?

They used to be a great tool to get out of a never ending timeshares before most timeshare companies caught on and started making officers of the LLC agree to be responsible for the financial obligations of the LLC. I think the term used is a Viking Ship in reference to a Viking funeral.

I briefly had a business idea of time share exit moving scummy time shares into straw co LLCs in opaque tax shelter islands in the Caribbean….but that is off topic for this thread.

In DVC they can be used to shield an owner from point owning limits, to skirt ROFR in a sale, dramatically speeds up the transfer of ownership because you are selling the LLC (not the DVC) and as a a way to keep direct buy status when selling a contract or contracts.

I hadn’t thought about a couple of these (especially direct status—I wonder if cleaning up LLCs might marginally increase availability at some of the direct resorts?) but another big reason big renters might like LLCs is to rent while limiting liability (the LL in LLC)…if Disney does start cancelling the reservations leaving owners stranded, the LLC could shield the ultimate owners from any damages incurred by the poor renters who show up homeless.

 

[VGCgroupie]

This is outside my area of legal expertise (though I did take a few bankruptcy law courses)—my layman’s guess is that the judgement is what was owed at (or somewhat before) the time foreclosure proceedings originated, and the additional money owed could be subsequent dues and interest (and possibly any fees Disney spent to collect after that, depending on their contract rights)— I assume they can ask for all that before letting you book new reservations on the contract?

Yes you are right this is what it is, I know anything owed to DVC has to be paid in full. So from what I read you can try to guesstimate based off when it went to foreclosure what additional you will owe, but it's never a guarantee. And there is no option for title insurance that I am aware of and you have to do your own title research to be sure there are no other liens.

 

[HyperspaceMountainPilot]

Yes you are right this is what it is, I know anything owed to DVC has to be paid in full. So from what I read you can try to guesstimate based off when it went to foreclosure what additional you will owe, but it's never a guarantee. And there is no option for title insurance that I am aware of and you have to your title research to be sure there are no other liens.

Trying to imagine what kind of loan shark or shady enterprise is making a 2nd or 3rd lien on a timeshare—bet the interest rate would be crushing.

 

[VGCgroupie]

Trying to imagine what kind of loan shark or shady enterprise is making a 2nd or 3rd lien on a timeshare—bet the interest rate would be crushing.

I 'think' its more for when they finance outside of DVC that its more of a chance of having leins and its easy to see if it was originally financed by DVC. But I am deal hunter not a gambler so I tapped out

 

[Cyberc1978]

I hadn’t thought about a couple of these (especially direct status—I wonder if cleaning up LLCs might marginally increase availability at some of the direct resorts?) but another big reason big renters might like LLCs is to rent while limiting liability (the LL in LLC)…if Disney does start cancelling the reservations leaving owners stranded, the LLC could shield the ultimate owners from any damages incurred by the poor renters who show up homeless.

If renters are utilizing a reservation from an LLC I assume that the contract is between renter and rental company. Not between renter and LLC.

The rental company would act as an intermediary though the owners would more or less be the same and the money goes into the same pockets.

If DVC clams down on the LLC and the reservation is cancelled then the rental company is on the hook for making the renter whole.

 

[mkatsy]

I checked into the price on the auction listing. That is the final judgment. All dues owed should be in there. However, the problem that occurs is the interest. It is only calculated (and included in the judgment price) up to the date of the judgment. The sale typically occurs 30 days later, and the funds can possibly be dispersed to the creditors (Disney) as much as 8 weeks later. So that leaves a fresh (post judgment) debt of 18% per day for three months. Also the buyer is responsible for the doc fees on the sale and that is an additional cost. Edited to add: not 100% sure on this interest

 

[Sandisw]

If renters are utilizing a reservation from an LLC I assume that the contract is between renter and rental company. Not between renter and LLC.

The rental company would act as an intermediary though the owners would more or less be the same and the money goes into the same pockets.

If DVC clams down on the LLC and the reservation is cancelled then the rental company is on the hook for making the renter whole.

If DVC finds that an LLC has rented to anyone who doesn’t not fall under the people as outlined by the contract, then they can enforce.

However, if the renter went through a broker, then that renters remedy would be based on the terms of the contract they have.

In many cases, it seems like more intermediaries do no have clauses in which they will help the renter out.

 

[Brianstl]

I checked into the price on the auction listing. That is the final judgment. All dues owed should be in there. However, the problem that occurs is the interest. It is only calculated (and included in the judgment price) up to the date of the judgment. The sale typically occurs 30 days later, and the funds can possibly be dispersed to the creditors (Disney) as much as 8 weeks later. So that leaves a fresh (post judgment) debt of 18% per day for three months. Also the buyer is responsible for the doc fees on the sale and that is an additional cost.

I am pretty sure regardless of what state the court foreclosure auction is in, that you don't pay any additional interest. Your winning bid covers all the interest in fees for the property in the auction.