Help! A few steps away from becoming a DVC member!!

[diznee25]

My fiance' and I have decided the DVC sounds great and would like to join but we're not sure if we can do it at this time....Depends on the answer to this question:
When Disney says they can finance a loan for 10 years exactly what kind of a loan is this? Obviously I'm not taking out a loan for $15000, I'm just buying points. Is a downpayment required, is there an APR? Do they check your credit history? If they do, I don't know if we'll qualify for that amount, considering we have other bills right now. (I'm sure everyone has car loans, etc.!) How is the monthly amount due figured out? Sorry for so many questions but any answers would be greatly appreciated

Thanks,
Michelle

 

[ZerasPride]

I'll try to help you out with my own family's experience.

We purchased 170 points and were required to put 20% down (the buy-back program gave us quite a bit of that amount since we bought at Hilton Head the buy-back was $15 per point). We only had to come out of our pocket with $500. I believe you can put as little as 10% down depending on your credit history. Our monthly payment is $138 and some change for our 10 year loan and because we have it directly debited from our checking account, they knocked 1% off the APR so we financed at 10.50%. I hope this helps you out and hope to welcome you home as members soon!

P.S. I didn't want any surprises when we were ready to buy so I contacted my guide and we pre-qualified for 200 points. They contacted us and told us we were approved within 48 hours. I only felt comfortable with 170 but now I wish we would have just gotten the 200. Again, hope this helps ya' out!

 

[jel0511]

What you are buying is a real estate interest in DVC, The loan is a mortgage, so they will check credit history, income levels, etc. DVC likes to get a 20% deposit on the purchase, but will give a loan with 10% down with a good credit history. You will be paying a higher interest rate with 10% down than 20% down. Using purchasing 200 points as an example here, your purchase price would be $16,000. If you choose to finance that with 20% down ($3,200 down payment) your monthly payment(assuming a 10.95% interest rate), including dues, would be approx $237. Now, 150 points assumption, using same figures from above would result in a $2,400 down payment and aprox monthly payment of $178. I hope that helps.

 

[RAD]

Remember, you might be able to deduct the intrest charge and real estate tax on your income taxes.

 

[crisi]

Please don't take this the wrong way, but I'm not sure what you are getting at with "obviously we are not taking out a loan for $15,000 we are just buying points." Don't kid yourself, this will be a loan for $15,000. I don't know what your financial situation is, but for most people $15,000 is a lot of debt.

Your other comment "I'm sure everyone has car loans, etc." is also distressing to me. No, not everyone has car loans. There was a poll here some time ago about how people paid for DVC and a quite a few members paid cash.

I'm a wet rag on this topic - far more financially conservative than most - I'm uncomfortable with any debt at all - I even hate my mortgage!

On the other hand, I can see the logic of "we are paying out $2,000 for our hotel room for this one trip, might as well use that money for our downpayment on DVC instead of throwing it out the window!" We basically burned the money we used for our last hotel room - two rooms at the WL cost us enough that even I think buying a DVC membership and putting it on a credit card (and paying it off fast) would have been a better deal!

 

[TheRustyScupper]

1) As mentioned, this is a true mortgage.
2) The typical rate is in the area of 10.75%.
3) They check credit, but DVC is lenient since they can foreclose.

4) In my own opinon, unless newlyweds have deep pockets, this type of purchase might be better forestalled. As previously posted by others, I am also a fiscal conservative and don't like to see especially newlyweds taking on a lot of debt.

 

[diznee25]

Thank you everyone for your respones. My fiance' and I are thinking along the same lines some of you are. We would like to spend the next few years paying off debt and getting our wedding/honeymoon expenses out of the way before we become DVC members. Obviously we love Disney so this is something we will strive for hopefully 3-6 years from now. Until then, I will continue to surf the DVC board, and who knows, maybe we'll rent points from one of you to check out these rooms!

Thanks everyone,
Michelle

WDW wedding and honeymoon 2004

 

[DemoBri1]

I would recommend checking into some other loans other than having Disney finance the deal. You can get alot better rate out there than the 10.95%, or whatever the going rate is now.

If we had had to finance through Disney, I'd doubt that we would have bought in August. It sounds as though you are loaded up with debt right now, however. Personally I would wait and get rid of some of that debt. You can always look into the resale market later on.

 

[diznee25]

crisi,

Please don't take this the wrong way, but I am young and assume that the average person has debt. Weather it be cars or other kinds bills. I used car loans as an example. I personally in the past had ton of medical bills for heart surgery and I'm only 23!!
I also didn't want to assume all DVC members were rich enough to pay out of pocket but I guess you proved me wrong with that poll you mentioned and I'm sorry. Some of us will never be rich enough to fork out $16,000 and that's ok. That's what loans are for and why I asked what kind of loan it was. My fiance' understands these loans better then I do and he was still confused so that's why I asked. Don't let it destress you crisi, you sound like a nice person. I just needed some answers.

Thank you

Michelle

 

[CarolMN]

Originally posted by diznee25
Thank you everyone for your respones. My fiance' and I are thinking along the same lines some of you are. We would like to spend the next few years paying off debt and getting our wedding/honeymoon expenses out of the way before we become DVC members. Obviously we love Disney so this is something we will strive for hopefully 3-6 years from now. Until then, I will continue to surf the DVC board, and who knows, maybe we'll rent points from one of you to check out these rooms!

Thanks everyone,
Michelle

WDW wedding and honeymoon 2004

FWIW, I think you have made a wise decision. As wonderful as DVC may be, it is essentially a prepaid vacation program. In other words, it is something to consider when you have the discretionary income to spend on expensive vacations. Most newlyweds do not.

IMHO, most newlyweds have (or should have) so many higher priorities than expensive vacations. Those might include items like paying off debt (perhaps from the wedding, a college education, credit card balances or a car purchase), building up an emergency savings account equal to about 4 to 6 months living expenses, buying a home, having children (and planning/saving for their education), saving for retirement, etc. That's not to say vacations aren't important, but perhaps annual trips to WDW aren't in the cards for awhile. I would hate to see my daughter (soon to be a college graduate, I hope) buy into DVC before she takes care of "the basics".

Congratulations and best wishes on your upcoming wedding!

 

[crisi]

Michelle,

You sound like you have your head on your shoulders. Best wishes on your wedding and marriage and I hope DVC will be in your future.


crisi

 

[ClarabelleCow]

When I got married, 12 years ago, we could have taken our wedding money, (we live in fairfield county, CT and had a wedding of 125 guests and yes mom and dad paid for it) and paid of bills, we had a mortgage, two car loans, and credit card bills, (we were young 21 and 22) instead of paying off the bills we took the money and bought a timeshare in the Caribbean (St. Maarten) it was frivolous and our parents were not happy, then went on to have 2 kids, became self employed, etc. buying that timeshare was probably the best thing we did, (thats my point) we go every year and think what a great wedding present!!! If your smart and money conscious and no how to budget, I say go for it if its something you both enjoy!!