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

[CanadianDVC2024]

The only thing that has definitively changed is that one must check a box to state that a reservation is for personal use.


This isn't new, it is just more clear. The "sole and unfettered discretion" langauge (or something like that) has been in the governing documents connected to commercial use for a very long time---and possibly dating back to the beginning.

I think the change that I am concerned about is that it seems they intend to actually enforce it now and from my phone call it seems that I have to use a majority of my past and present reservations and should be renting only to family and friends.

I know Sandi is of the opinion they won't come after people like me, but I also dont want to chance it neither.

 

[PolyRob]

@CanadianDVC2024 , I really don't think you have anything to worry about at all. Renting because you cannot travel is nothing at all like renting for commercial purposes. It's really apples and oranges.

On a different note, can anyone let me know if my assumption is correct regarding resale companies? I'm of the assumption that when the resale company offers to buy the contract themselves, they strip the contracts and rent out the points and then resell the stripped contract. To me that is the very definition of commercial renting. Am I correct that they are doing that?

This is definitely happening and probably why the new transfer rule was also implemented.

Resale companies couldn't flip the contract with active reservations so they transferred the points and sold. Not anymore...

 

[Sandisw]

There is a distinction here. Disney has an idea of what constitutes commercial renting-whatever that may be. First they have to decide if points are being rented. They have no way of knowing that based on a name on a reservation. By attesting "personal use"--your idea of "personal use" might be different than Disney's. Again--Disney trying to figure it out on their own seems silly when they could just ask.

But in terms of the personal use clause, they don’t need to distinguish that from the start.

If the names on the reservation are not the owners, and there are a lot of them, then they have a reason to review.

If I have three reservations this year that don’t have my name, whether those are renters or family/friends, DVC may decide that is occasional enough to ignore.

But, if I have 20 reservations in others names, the. DVC may decide that is too many to ignore and will now discuss with an owner.

Again, as long as some renting counts as personal use, having it the way they do puts the responsibility on the owner to follow the rules of the contract.

As I said, what I think should be an acceptable level of renting in line with my right to rent may not be the same as someone else’s.

If DVC said my actions are seen as out of line, then I’d need to adjust.

ETA: I think we should not complicate this. DVC has stated they want those who bought for the sole purpose of renting to make money out.

They do not want the average owner who is renting within reason to lose that flexibility.

 

[AstroBlasters]

There is a distinction here. Disney has an idea of what constitutes commercial renting-whatever that may be. First they have to decide if points are being rented. They have no way of knowing that based on a name on a reservation. By attesting "personal use"--your idea of "personal use" might be different than Disney's. Again--Disney trying to figure it out on their own seems silly when they could just ask.

If I had an algorithm and AI, I would have a report of all memberships where more than 50% of points were used on reservations where an owner is not on the reservation and START there.

I would then set parameters to put memberships owned by LLC’s under an advanced level of scrutiny.

 

[dcfromva]

This is definitely happening and probably why the new transfer rule was also implemented.

I apologize, but what is the new transfer rule? I thought the transfer rules were made a little bit more relaxed this year --where you could transfer between your own contracts more that once per UY? (I haven't tried it yet so I don't know exactly how it works).

 

[Sandisw]

I think the change that I am concerned about is that it seems they intend to actually enforce it now and from my phone call it seems that I have to use a majority of my past and present reservations and should be renting only to family and friends.

I know Sandi is of the opinion they won't come after people like me, but I also dont want to chance it neither.

No MS agent is ever going to go into a discussion on renting. They will state what this new language says for family and friends.

It would be a liability waiting to happen. I had several conversations with DVC. including some up the chain last year and even then, they pointed me to the contract and its language.

The bottom line was that you, as an owner, are responsible for following the contract and deciding if what you are doing could be considered anything but acceptable rentals under the personal use clause.

If your membership is for you, but you can’t travel for one year, for whatever reason, then that matches an example shared at last years condo meeting as acceptable.

DVC recognizes that things happen and an owner might be able to travel that year.

 

[PolyRob]

I apologize, but what is the new transfer rule? I thought the transfer rules were made a little bit more relaxed this year --where you could transfer between your own contracts more that once per UY? (I haven't tried it yet so I don't know exactly how it works).

This is true, you can now transfer banked and borrowed points, but DVC has stopped allowing members the courtesy of multiple transfers when it's between their memberships.

 

[dcfromva]

But in terms of the personal use clause, they don’t need to distinguish that from the start.

If the names on the reservation are not the owners, and there are a lot of them, then they have a reason to review.

If I have three reservations this year that don’t have my name, whether those are renters or family/friends, DVC may decide that is an occasional enough to ignore.

But, if I have 20 reservations in others names, the. DVC may decide that is too many to ignore and will now discuss with an owner.

Again, as long as some renting counts as personal use, having it the way they do puts the responsibility on the owner to follow the rules of the contract.

As I said, what I think should be an acceptable level of renting in line with my right to rent may not be the same as someone else’s.

If DVC said my actions are seen as out of line, then I’d need to adjust.

So you are saying their goal is to not only crack down on folks commercially renting, but also folks who gift their points to friends and family?

 

[Brian Noble]

At some point, this does catch up with you as a business.

It hasn't with any of the others farther along this route. At least, not yet. Travel & Leisure is now the ticker under which the various arms of Wyndham operate. Wyndham has gone the farthest, and they are doing just fine--both in terms of sales and in terms of makret position.

When you impose restrictions that devalue the product substantially,

What, exactly, has been devalued? The resale value? That does not matter. Wyndham's resale value is approximately 1/10th, if that; they are selling just fine, and sold more in dollar value in 2024 than 2023. If instead you think the usage is devalued, there might be an argument there, but again--Wyndham has more restrictive guest policies, and it doesn't seem to matter.

allow maintenance fees to spiral out of control

This is a problem, and has IMO been one of Marriott's challenges. But even here, I don't think it is unfavorable. The 2024 MFs on a 2BR at Grande Vista (also in Orlando) were just shy of $1,900/week. That was a huge increase (17%), but the increase was due partly to new Florida requirements to fully fund structural reserves. Even so, that's not horrible. SSR's "maximum reallocation" figure for a 2BR is 41 points/night---this is the point value that results from every single night in the Base Year being the same cost. That puts a week in an SSR 2BR at 41 * 7 * $8.14, or $2,336.

it often takes them to pay $250+ to get people to attend a 90-120 minute high pressure sales pitch

I bet you would be surprised to know what DVDs marketing costs come to. True, they do not give (much) in the way of tour incentives. But, those free Membership Magic evenings in fully-operating theme parks are very much not free. You can't swing a dead cat around WDW without hitting a DVC kiosk, and those are all staffed with one or more people who need paid.

 

[Sandisw]

I apologize, but what is the new transfer rule? I thought the transfer rules were made a little bit more relaxed this year --where you could transfer between your own contracts more that once per UY? (I haven't tried it yet so I don't know exactly how it works).

They changed the rules to allow banked and borrowed.

They stopped the more than one per owner. Which, technically was never part of the rules…they just didn’t enforce that.

 

[Brian Noble]

Before that it was subject to a test of reasonableness on DVCs part.

...and that's probably not going to be a problem, because Disney is likely to choose carefully if and when they decide to make an example of someone. And, not even necessarily because of this, but because they are going to want the court of public opinion anong the rest of the DVC membership clearly on their side.

That might be the main lesson from watching Wyndham do this. The bulk of the rank-and-file owners were solidly behind each change, even some of the more drastic ones, like Owner Priority periods. The policies were designed such that they did not impact the vast majority of owners, so those owners at worst shrugged.

 

[MartyParty]

Thanks for posting this, Sandy, and thanks to Paul for your very informative and promptly shared article.

Using myself as a test case: we have approximately 600 points spread across four resorts. We last rented points in 2017 and 2018 and have used our points for personal stays since then.

Given that:
A) We seldom rent, and
B) We have a relatively low number of points compared to commercial renters,
I don’t think we’ll ever surface as a concern.

Even if we started splitting our annual stays and renting out some points each year, I doubt we’d appear on Disney’s radar. I suspect the real targets are those with 5,000+ points and 50+ individual bookings annually. From a database reporting perspective, I don’t think the average DVC owner will be noticed and impacted—even if they rent every year.

I recall one poster in this thread mentioning buying resale with the intention of alternating between personal stays one year and renting the next. I personally don’t think Disney will care, but time will tell. In my mind, I picture a database report showing the number of points and reservations per member annually. From a data management standpoint, Disney will likely focus on the top 5 or 10 outliers. I’m probably number 200,000 on the list when it comes to annual points and reservations.

From DisneyConnect.com:

Disney Vacation Club, a leader in vacation ownership, debuted in 1991 with a flexible, vacation points-based system rather than the traditional fixed-week timeshare model. Now, Disney Vacation Club has more than 250,000 Member families from all 50 states and approximately 100 countries who have discovered the joys of Membership.

 

[Sandisw]

So you are saying their goal is to not only crack down on folks commercially renting, but also folks who gift their points to friends and family?

Absolutely not. What I am saying is that as an owner, you are allowed to make reservations in the names of others…whether it’s family or friends or renters.

It doesn’t matter. What matters is if DVC sees the volume and regularity as a clear case that you are in it for commercial purposes…

Every time an owner makes a reservation, they are agreeing that whomever it is for, fits the personal use clause…and some renters count.

My opinion… if one owns less than 2k points and isn’t renting the bulk of them, they won’t even check. But again, I’m not DVC.

I do feel fairly confident that those owners who should worry are those who are owners of 4000 to 8000 points who pretty much never use them

ETA. I think this new aspect is really to let all owners know they are monitoring and making owners think about it.

 

[ILoveMyDVC]

I used to work in government, I know how money can be allocated, shifted, and accounted - both for bad and for good reasons and intent.

 

[MartyParty]

Sandy, my guess of 5,000 fits right between your range of 4,000 to 8,000. I think that where Disney will focus.

 

[OKW Lover]

I see many people posting about what their definition of commercial renting is. And many posting their definition of what personal use is. That's nice, but in the end it is DVC that makes that decision.

 

[Sandisw]

Sandy, my guess of 5,000 fits right between your range of 4,000 to 8,000. I think that where Disney will focus.

And going back to the meetings in December, they really did seem to say it’s those large point owners who are clearly doing it as a business.

They chose the words in the updated T and C carefully and made sure that the consequences of being found using the membership outside those terms something an owners has acknowledged.

So, this puts everyone in notice

 

[mistysue]

I'm just glad they're saying/doing SOMETHING to acknowledge the issue for real. It's so hard to argue that anyone buying thousands of points to primarily rent out isn't commercial, even if they divide them into five contracts and use employee names, etc. It's not a huge deal for random owners to rent an occasional extra reservation but the number of hard to get ressies listed all over the internet is infuriating at times. (like the day you are trying to book one )

 

[Goofy2015]

I am not a lawyer. Given no clear definition of commercial and personal use for DVC points, I can see a lawsuit coming even from the bad apple DVC owners renting out their points like a business. I do not like the rental DVC companies or walking of reservations. That said, I actually hope Disney would lose such lawsuit. I think there can be other policies at play to regulate rental DVC owners from abusing the system.

 

[AstroBlasters]

I am not a lawyer. Given no clear definition of commercial and personal use for DVC points, I can see a lawsuit coming even from the bad apple DVC owners renting out their points like a business. I do not like the rental DVC companies or walking of reservations. That said, I actually hope Disney would lose such lawsuit. I think there can be other policies at play to regulate rental DVC owners from abusing the system.

I hope the commercial renters enjoy losing thousands of dollars through attorney fees on a frivolous lawsuit.