How to stop points from disappearing before closing?

[dbkelly]

My husband and I are considering a resale, so I would like to know how we protect the points on the contract from being used by the seller just before the closing?

Thank you

 

[wilkydelts]

The contract states they owe $X.XX amount per point if the points that the contract states you should recieve are not accurately recieved.

 

[byurick]

You can't (its kind of an honor system) but make sure your contract has a clause where the seller has to reimburse you for missing points at the very least.

 

[dbkelly]

I am fine with being reimbursed for missing points, but does anyone know how this clause is enforced. Does the broker maintain the funds in escrow until the points are deposited in my account?

 

[Sandisw]

I am fine with being reimbursed for missing points, but does anyone know how this clause is enforced. Does the broker maintain the funds in escrow until the points are deposited in my account?

It depends on broker and title company. Our board sponsor, when you use Magic Vacation Title, which is part of World of DVC, guarantees it and goes after the seller.

Others, go after seller and at least one title company…could be more…don’t release funds to seller until buyer verifies all is correct.

 

[Brian Noble]

Generally no. Funds are usually transferred on closing. There is at least one broker (as mentioned by @Sandisw) who guarantees the payment themselves, but their in-house closing costs are higher---think of it as insurance.

The vast (vast!) majority of sellers are honest, so I would not worry that much about it.

 

[JackosinDIS]

Trcsinc.com is the closing company that holds funds until the buyer has confirmed that points have been loaded. Their closing costs are very reasonable as well.

 

[TinkAgainU]

Generally no. Funds are usually transferred on closing. There is at least one broker (as mentioned by @Sandisw) who guarantees the payment themselves, but their in-house closing costs are higher---think of it as insurance.

The vast (vast!) majority of sellers are honest, so I would not worry that much about it.

Agreed, you'll know the legal name of the Seller(s) as soon as you receive the purchase agreement (sometimes even with an address) - you can double check that on the recorder's site yourself - just to feel a little more confident. While no guarantee, I think knowing the Buyer knows their name helps a bit with the honor system lol. Most escrows will require a screenprint of current points before Closing, so you are a bit more covered with that step too - while someone could certainly make a fake screenshot, Escrow is usually just checking to make sure there are no accidental transfers of points etc.

READ your contract carefully, each differs as to how "missing" points would be treated. And feel free to ask the Listing Agent how carefully they have verified the points with the Seller - especially inexperienced Sellers who might need to review with the Agent to make sure the points are not Banked etc.

 

[DanCali]

My husband and I are considering a resale, so I would like to know how we protect the points on the contract from being used by the seller just before the closing?

Thank you

I am fine with being reimbursed for missing points, but does anyone know how this clause is enforced. Does the broker maintain the funds in escrow until the points are deposited in my account?

You're asking all the right questions. In fact, you remain vulnerable to this even after closing since it takes Disney a couple of weeks after the deed is recorded to transfer the ownership internally and the seller still controls the points.

We've closed multiple contracts (most with the board sponsor, but some with others) and it's always been fine so far. We got exactly the points that were advertised. In one case the advertised points were wrong in the sense that a handful of advertised "banked" points were actually bankable current year points, and we found that out shortly after the offer was accepted.

I usually make a point to reach out to the closing company and the broker to verify the points again before closing, especially if the closing is delayed by a few months due to an owner reservation. People can make honest mistakes over that long of a period.

 

[CraigInPA]

I am fine with being reimbursed for missing points, but does anyone know how this clause is enforced. Does the broker maintain the funds in escrow until the points are deposited in my account?

I had this issue. The owner used points between ROFR and closing. I demanded a refund at $25 per point or the points back per the contract. The broker (Fidelity) was diligent about making the owner make it right. Fidelity stated that they would write me a check if the owner didn't get the points back or pay them.

 

[atthebeachclub]

As a data point as there is already good info here: So far on my three completed purchases, all reported points have been there. One contract even contained a full year of additional unreported points!

 

[VGCgroupie]

Some brokers write into the contract that the broker will be reponsible for missing points, other brokers state seller will be responsible. The seller being responsible per contract is basically no guarantee in my eyes. I was also worried about this. Everything turned out fine on all 5 of my resale purchases even when I used a not so well known broker who had no protections written in the contract.

 

[vicarrieous]

As a data point as there is already good info here: So far on my three completed purchases, all reported points have been there. One contract even contained a full year of additional unreported points!

I only have two, and both had reported points, One had an extra year as well!

 

[disneylandtour]

I've found that both https://www.fidelityrealestate.com/ and Mason title have been very good about managing any issues like this. The issues I've had had been minor. But they have been fixed by them. This is probably one good reason not to buy from someplace like Facebook groups, craigslist, or Redweek. None of those are actual brokers. They are all just places to list things, often by owner.

 

[Stargazer65]

I had it happen one time where the points received were not what was listed on the contract. It was supposed to be 100 current year points, instead it was 50 current year and 42 banked. It was an honest mistake where the seller had multiple contracts and confused them. The seller reimbursed me for the error, and the broker booked me a free vacation by way of compensation for their part in the mix-up.

Just make sure the contract is clear on what is due in terms of points, and the compensation if it is not. Other than that, I would not worry about it, I really doubt there is much of a chance of intentional fraud.