How did YOU finance DVC?

[Coach81]

We financed through the same company that we financed our home through.

 

[jodifla]

And I think it makes no sense to go to Disney since 2001, staying on site, wanting to be a DVC member and still paying cash rates.. Even with the interest paid, you would have been money ahead buying in 2001, not to mention staying in a better resort..

Exactly.

We bought back in 1996 and financed the whole purchase. We were already spending a fair amount each year going to Disney, so we just shifted those funds to paying off the DVC. We had no kids, both had jobs, and it was basically no more than a car payment.....only unlike a car, we'd have it for 42 years!

So we paid it off years ago now, and have watched the price DOUBLE what we paid for it. We could still sell it for more than we paid for it.

And we've treated family and friends to great vacation times. It's like another poster said....you can't take your money with you. Life is a balance of saving enough to live and spending enough to have a life.

 

[december14disney]

\Life is a balance of saving enough to live and spending enough to have a life.

I love that quote! I sent it to my fiance as if to say "we did the right thing buying DVC!" and he responded "you just want that diamond necklace for Valentines!"

 

[logan115]

Exactly.

We bought back in 1996 and financed the whole purchase. We were already spending a fair amount each year going to Disney, so we just shifted those funds to paying off the DVC. We had no kids, both had jobs, and it was basically no more than a car payment.....only unlike a car, we'd have it for 42 years!

So we paid it off years ago now, and have watched the price DOUBLE what we paid for it. We could still sell it for more than we paid for it.

And we've treated family and friends to great vacation times. It's like another poster said....you can't take your money with you. Life is a balance of saving enough to live and spending enough to have a life.

I think that if you're looking at DVC as a money maker it is most likely not your best option. What it can/will provide is the ability to stay at the resort(s) you want (not going to say if they're better/worse than any others ) at a price that is reasonable. I chose the word "reasonable" as it will never be "cheap" to stay at WDW, but comapred to rack rates or even discounted rooms DVD is still imho a better deal after you factor in the buy-in and MF. I've rented twice, and if I don't buy DVC I will rent again - but I'll have to hope I get lucky and can get a ressie that I want, not have to just take what I can get. For us, being a family of 4 from Chicago, going to WDW is an expensive trip (about $5K for each of our last 2 trips), and if I'm going to spend the money I might as well pay a bit more to stay where I want.

However, if I own DVC I'll have a much better shot of getting to stay exactly where I want, when I want, and not have to worry about someone else being in control of my ressie. That comfort and piece of mind carries a value that no one seems to factor in to any of their analysis. I'm looking at buying a resale contract(s) for about 75-80 pts, which will give me enough for a trip every other year, and cost me $7-$8K. Will I pay cash, or finance ? Who knows, is it silly to pay 10% interest, maybe, but if it allows me to keep $8K in the bank in case of emergency than 10% isn't so bad, is it ?

Going to Disney every year (or every other year, or multiple times within a year) may not make financial sense, but if it's something that you truly enjoy (like I do) why not ? Yes, I want to make sure I am able to provide for my family, and that we're well positioned for retirement 30 years from now, but how happy will I be if my whole life I pass on the things I want to do to build a cash hoard for later in life ?

Our DS(5) is starting to catch "the fever," and has had a lot of fun on our two trips (even though he's only been on about 5 rides ), and DD (2 months) has already enjoyed Soarin' (albeit when she was still in DW's belly ). I'm not necessarily looking at owning DVC until 2057, but I may. Another thing no one seems to consider is the resale value of DVC in 10-15 years. Will it be lower than today, most likely because the asset has less time remaining, will it be zero - I don't think so. So if I buy this year, net of MFs it saves me $500 per trip on my lodging, and if I take 5-6 trips over the next 10 years that's $5K I've saved. If I sell-off my then paid off DVC for even 1/3 of what i pay today, I'll get $2600 back (will probably use it for another trip to WDW ), which kinda gets me back to the $8K I paid for DVC.

Oh, so I paid $8K, ultimately received the benefit of about $8K, but lost out on the time value of money for 10 years. Yes, I certainly did, but I would also be losing out on the TVM for the $1500 or so I'd pay cash to even rent a ressie every other year. Does that ultimately cost me money - YES, do I feel excited about being able to "go home" every other year - YES. Will it always be the best deal that you can get on staying at WDW - NO (renting points is probably the cheapest), but will I be at the mercy of waiting for PIN codes, specials, and having to travel on dates that I may not want - NO.

Can I just stay at a value every time I go, sure, have stayed at POP and my DS likes that just as much as BCV and SSR, and that would save money too. Don't hate me for saying this - but heaven forbid - I could stay off-site and get a bigger room for less, but I really don't want to.

I guess the ending to my rambling is this - it is important to do you're own analysis to determine if it's right for you. Is it the best investment you will ever make - hopefully not. Can you make the decision purely on the numbers ? Some can/will, but remember that piece of mind is worth something too.

I'll have a better idea of what I'm doing in a month or two (my employer typically does raises/bonuses in Feb/Mar), and depending on how that goes I'll make my decision.

To the OP -

Good luck, and please remember to factor in all the pros/cons that people post as it's good to hear both sides of the story. But ultimately YOU need to be the one that makes the decision as it's your money.

Chris

 

[dandave]

So we paid it off years ago now, and have watched the price DOUBLE what we paid for it. We could still sell it for more than we paid for it.

Are you using Disney math or did you really buy OKW at $38 and BCV at $46? My hat is certainly off to you, if you did!

 

[Cruelladeville]

Just pointing out that if a family is going to Disney on a yearly basis anyway, its probably going to be cheaper to finance and pay interest than to pay cash and buy DVC after a few years of saving..

Not so! Now I bought in 96 at $56 a point, on a 10 year contract, and that 10% interest was a big incentive to get that contract paid off in three years!. My cost for a studio worked out to about $47 per night back then. I've never figured it out in today's dollars, but I have continued to buy contracts, once in cash, once refinancing my house, and once using 0% on a credit card. But it was the 10% interest for 10 years that really pushed me to double and triple my payments to pay things off more quickly.

BTW, we are all taking offense at the word "better" when talking about reserving a room, which makes it sound as if DVC is second-rate. It's not, of course, but you need to watch how you say things if you are not trying to offend people here.

 

[JonS99]

Not so! Now I bought in 96 at $56 a point, on a 10 year contract, and that 10% interest was a big incentive to get that contract paid off in three years!. My cost for a studio worked out to about $47 per night back then. I've never figured it out in today's dollars, but I have continued to buy contracts, once in cash, once refinancing my house, and once using 0% on a credit card. But it was the 10% interest for 10 years that really pushed me to double and triple my payments to pay things off more quickly.

BTW, we are all taking offense at the word "better" when talking about reserving a room, which makes it sound as if DVC is second-rate. It's not, of course, but you need to watch how you say things if you are not trying to offend people here.

First off, I was saying better when comparing DVC to the other posters stays at the All-Stars, was saying DVC is better (much better actually)..



My point of view.. buy 160 points at $100/point, 10% down and finance $14400. Pay off in 3 years and the interest will be about $2400, add in another $1800 for dues and the extra cost of about $4200...

On the other side, save up for 3 years and pay cash for 3 trips in a Deluxe resort, even with a good discount around $250/night x 21 nights over those 3 years and thats $5250.. On top of that, waiting 3 years the price/point will increase, even if only $5/point thats a cost of $800..

If one really works the numbers, the costs associated with financing are often not that bad for certain people.

 

[logan115]

First off, I was saying better when comparing DVC to the other posters stays at the All-Stars, was saying DVC is better (much better actually)..



My point of view.. buy 160 points at $100/point, 10% down and finance $14400. Pay off in 3 years and the interest will be about $2400, add in another $1800 for dues and the extra cost of about $4200...

On the other side, save up for 3 years and pay cash for 3 trips in a Deluxe resort, even with a good discount around $250/night x 21 nights over those 3 years and thats $5250.. On top of that, waiting 3 years the price/point will increase, even if only $5/point thats a cost of $800..

If one really works the numbers, the costs associated with financing are often not that bad for certain people.

Also can't underestimate the value of having access to cash in your bank account. Does it make sense financially to pay 10% when your savings account only earns 3-4% (if you're lucky) - obviously not. But if you can sleep better at night knowing that you still have liquid assets perhaps it's worth giving up the 6-7% points.

 

[jodifla]

Are you using Disney math or did you really buy OKW at $38 and BCV at $46? My hat is certainly off to you, if you did!

I bought in at around $62....and what's Disney up to now? Like $104 close enough to double for me!

 

[dizzneebabe]

It's a personal choice that only you can make!

We financed, still make payments however, my kids get to enjoy vacations every year, sometimes 2-3 times. We may pay off a little early...nothing to write home about.

Family memories are worth some interest $$$$ to me.

Well said! We did the same thing...in fact we just added on more! Heck, if we had just bit the bullet before and financed, we would have had purchased it 10 years ago and paid off by now!!!

It's great if you have the cash to pay in advance, but we didn't/don't. We're comfortable with the payments knowing how many wonderful trips we will get for our $$! Plus, we write off the interest which helps a little in the end!

 

[dandave]

I bought in at around $62....and what's Disney up to now? Like $104 close enough to double for me!

OKW is going for around $72, if you're being generous. I'll be generous. What did you pay for BCV? You're probably a little ahead on that one, since it can be had for $90-$91.

 

[logan115]

Well said! We did the same thing...in fact we just added on more! Heck, if we had just bit the bullet before and financed, we would have had purchased it 10 years ago and paid off by now!!!

It's great if you have the cash to pay in advance, but we didn't/don't. We're comfortable with the payments knowing how many wonderful trips we will get for our $$! Plus, we write off the interest which helps a little in the end!

Howdy neighbor - I'm in Wheeling about 20 miles southeast of ya !

 

[december14disney]

OKW is going for around $72, if you're being generous. I'll be generous. What did you pay for BCV? You're probably a little ahead on that one, since it can be had for $90-$91.

I think she was saying that when she bought Disney was selling new DVC contracts for 62 and now they are selling for 104. I dont think she was saying specifcally OKW just new contracts from Disney.

 

[dandave]

I think she was saying OKW. She owns OKW and BC, and only OKW was open when she first bought in 1996.

 

[jodifla]

I think she was saying that when she bought Disney was selling new DVC contracts for 62 and now they are selling for 104. I dont think she was saying specifcally OKW just new contracts from Disney.

This is exactly what I was saying.

 

[jodifla]

Oh, and another thing...while other people have endlessly crunched the numbers and torn their hair out and procrastinated while the price to join has skyrocketed, putting it even further out of reach, I've been taking really great vacations for the last 12 years with family and friends in really comfortable, spacious accommodations.

I've had it paid off for years (even with the dreaded financing) and it's been a PERFECT fit for our family. We have family members who bought a second vacation home....and they really wish they didn't have it now, and it's impossible to sell.

No such worries for us!

I'm really glad that we bought when we did, before kids and two incomes. Then, when DS came along, one of us started working from home...but NO WORRIES!!! DVC is paid off by that point, so we are STILL taking KILLER trips even on one or 1.5 incomes.

I'm so glad we didn't overthink it... Of course, it was easier than. BECAUSE IT WAS A LOT LESS MONEY!!!

 

[dandave]

I gave the same advice that I would give to my children. As I Dis, I'm usually watching the current economic situation and the stock market on CNBC while trading online and doing my housewifey things. I would hate to know that I suggested that anyone take on extra, unnecessary debt in these times to be part of "the club". And tying vacation debt to your home right now is , IMHO, particularly frightening.
This was a beneficial thread for me, at least. A part of me is honestly starting to hope that my contract doesn't pass. I feel almost as if I had a near miss with part of some crazy Disney Vacation Club cult. Certainly many here appear quite normal, but just as many are consumed with the acquisition of financed points, vast numbers of these Holy points, and avoiding the Value Resort slummers and icky rental people.
They want to own, by God. It may seem like a lease, since it has to be given back at a specific time, but it's not! Oh no. It is that which has the ability to make one's vacations more magical, one's money stretch farther and buy twice as much, one's resort bus come faster while always having enough seating, and one's children more beautiful with sparkly blue eyes and ultra-white teeth. (There's an organ playing in the background, here.)
That's just a lot of pressure for little ol' me, and I'm not sure that I am worthy. Forgive me DVC Holy One, but I really think I would prefer to stay with the other non-believers and retain my little bit of sanity. If I do have to make it through the ROFR or whatever it's called, please don't let them take my ability to think rational financial thoughts. Please.
Amen.

 

[logan115]

I gave the same advice that I would give to my children. As I Dis, I'm usually watching the current economic situation and the stock market on CNBC while trading online and doing my housewifey things. I would hate to know that I suggested that anyone take on extra, unnecessary debt in these times to be part of "the club". And tying vacation debt to your home right now is , IMHO, particularly frightening.
This was a beneficial thread for me, at least. A part of me is honestly starting to hope that my contract doesn't pass. I feel almost as if I had a near miss with part of some crazy Disney Vacation Club cult. Certainly many here appear quite normal, but just as many are consumed with the acquisition of financed points, vast numbers of these Holy points, and avoiding the Value Resort slummers and icky rental people.
They want to own, by God. It may seem like a lease, since it has to be given back at a specific time, but it's not! Oh no. It is that which has the ability to make one's vacations more magical, one's money stretch farther and buy twice as much, one's resort bus come faster while always having enough seating, and one's children more beautiful with sparkly blue eyes and ultra-white teeth. (There's an organ playing in the background, here.)
That's just a lot of pressure for little ol' me, and I'm not sure that I am worthy. Forgive me DVC Holy One, but I really think I would prefer to stay with the other non-believers and retain my little bit of sanity. If I do have to make it through the ROFR or whatever it's called, please don't let them take my ability to think rational financial thoughts. Please.
Amen.

For some it makes sense, for others it simply doesn't (both financially and from a lifestyle standpoint). It depends on your vacation habits, and financial situation. Suppose just "investing" always puts you out on top as well, right ? 10 years and zero net gains for the market. There are no sure things, and I wish the best of luck as you continue to navigate the market.

Just think, if I bought DVC a year ago, and paid cash, even if my resale value dropped 20% I'd still be 20% better off than putting that money in the market.

Not quite sure that people are looking to be berated for posting questions or opinions here either.

Just my 2 cents.

Chris

 

[dandave]

Chris, if you had bought FRE or FNM when it dropped to pennies, and then sold it at when the expected tarp raised it's value about 10 fold... Well, don't worry about me. I certainly do appreciate your concern, however.

 

[Pinkerbelle8]

I don't understand how my original post has evolved to this. I just was curious as to how others financed their decision to buy DVC. Can't we all just get along?