Hurricane rentals - missed opportunity for brokers?

[Genie+]

I have rented in the past and used the funds for DCL and the broker I use has implemented a clause in the contract to address this very issue, it's called " Force Majeure" and it covers both the owner and the renter. The owner gets paid the final installment on check in day and the renter gets a credit for the full rental amount to use at a later date. The only person losing out here is the broker. I'm certain they do that to secure future business on both ends.

Now the broker does ask the owner to allow them to re rent the returned points if possible before they expire but the owner does not have to agree to do that if they choose not too the only reservation you are obligated to is the one you originally agreed too but morally I think as the owner I would assist with that since I was paid in full already. If the points expire or are in dreaded Holding status and nothing can be booked it is the Broker that takes the loss.

Renter is only out if they can't find another time to use the full credit they were being offered due to the "Force Majeure" and the owner is out nothing at all.

Of course I don't know if this is how all brokers handle it, so it's best to read your contract thoroughly and know what your agreeing to in all circumstances.

I have rented a lot of my points out after Covid I couldn't travel and they had backed up on me, I found it to be a very pleasant experience, quick, and easy. I read the contract multiple times and asked a lot of questions before signing anything, I think most of the concerns expressed in this thread would be summed up by reading that "Force majeure" clause in the contract.

Are you sure the ‘Force Majeure’ would have applied to this hurricane situation?

I’ve had that written in some of our contracts. My understanding is it would only ever apply to very unique circumstances. It wouldn’t apply to things that commonly happen, like hurricanes or blizzards disrupting travel, airlines going out of business, airports shutting down. It would apply for something outside the scope of expected, and only when whatever happened makes the contract ‘impossible’. That’s what happened with covid - reservations during closure dates were impossible for anyone to check in. What was being sold on those contracts ended up not existing. That’s when a force majeure might come in. The rooms and reservations still existed with Helene and Milton. Only if a storm actually closed down the resorts and made it impossible for anyone to get what was contracted, then force majeure. And in the rare event force majeure did come in to play, the renter/rentee would share the burden. If a rental cost $2000, the owner would only get half that amount and the renter would only be out half that amount.

 

[2010dvcfan]

Are you sure the ‘Force Majeure’ would have applied to this hurricane situation?

I’ve had that written in some of our contracts. My understanding is it would only ever apply to very unique circumstances. It wouldn’t apply to things that commonly happen, like hurricanes or blizzards disrupting travel, airlines going out of business, airports shutting down. It would apply for something outside the scope of expected, and only when whatever happened makes the contract ‘impossible’. That’s what happened with covid - reservations during closure dates were impossible for anyone to check in. What was being sold on those contracts ended up not existing. That’s when a force majeure might come in. The rooms and reservations still existed with Helene and Milton. Only if a storm actually closed down the resorts and made it impossible for anyone to get what was contracted, then force majeure. And in the rare event force majeure did come in to play, the renter/rentee would share the burden. If a rental cost $2000, the owner would only get half that amount and the renter would only be out half that amount and the renter would only be out half that amount.

I did email this week and ask if hurricanes were included in the "Force Majeure' and they said yes, all acts of nature are included. Even though I don't have any points rented out at this time, they responded immediately and said they were monitoring the storms and airport closures that would impede travel. Didn't say anything if the resort was closed or not. They said if guests were unable to travel all owners will still receive final payment on check in day and if the guests did not have travel insurance a full credit for future use would be available.

Now I have not personally been involved in this but I did receive and email that assured me they would take care of both parties thru out this situation.

 

[Sandisw]

Yes, I am sure, I sent them an email inquiring this very situation last week and they responded. Even though I don't have any points rented out for month of September they responded to me immediately.

I'll try to find the email and post a segment of it for you. Owners get paid the final installment and guests get a full credit if they do not have travel insurance. Broker takes the lose if there is one, if the points expire or if the owner refuses to assist with re renting the points. They do an excellent job taking care of both parties in the agreement. Owner gets paid in full, the renter only loses out if they don't rebook with the travel credit.

Thank you for reaching out!

It is very considerate of you to consider options in cases such as hurricanes preventing stays and travel.

I will let you know that our team closely monitors the status of the resorts and airports, and reach out to any and all guests affected by closures. Resort closures caused by hurricanes do fall under our "Force Majeure" policy in the Rental Agreement.

Here is the nuisance of that. It says resort closures are covered. Not park closures, not canceled flights, and not not being able to get there.

So, if WDW closed the resort down and no one could stay, it’s covered

This week, resorts were open…only parks closed. So, as long as the resort remains open, the renter still can check in. So, that clause does not apply…which is why there are reports of brokers who have that language reaching out to owners asking if they are willing to help because they don’t have to.

That language was updated when Covid hit because the renters could not even check in.

 

[2010dvcfan]

Here is the nuisance of that. It says resort closures are covered. Not park closures, not canceled flights, and not not being able to get there.

So, if WDW closed the resort down and no one could stay, it’s covered

This week, resorts were open…only parks closed. So, as long as the resort remains open, the renter still can check in. So, that clause does not apply…which is why there are reports of brokers who have that language reaching out to owners asking if they are willing to help because they don’t have to.

That language was updated when Covid hit because the renters could not even check in.

That could be absolutely correct, I hope not for the guests, but the owner wouldn't take a hit either way I don't think. Do you?

I guess in the end the loss of money or points for any of us is trivial in the bulk of this situation.

 

[2010dvcfan]

Here is the full email, I wasn't sure I could post it so I edited the first reply, I didn't want to break any rules.

Thank you for reaching out!

It is very considerate of you to consider options in cases such as hurricanes preventing stays and travel.

I will let you know that our team closely monitors the status of the resorts and airports, and reach out to any and all guests affected by closures. Resort closures caused by hurricanes do fall under our "Force Majeure" policy in the Rental Agreement.

Guests who's stays are impacted by Force Majeure are provided the opportunity to cancel their stay for insurance purposes should they have the option. They are otherwise provided a travel credit valued at the same amount that they have paid for the reservation that can be used for future stays with our company as stated in the Rental Agreement.

As a DVC Owner, you would still receive the final 30% payment you are owed for a stay secured that is affected by Force Majeure. In most cases, you would need to cancel the reservation manually, and DVC would return the points to your account. Usually cancelling a stay within such a short time would result in the points being placed into holding, but in cases such as hurricanes, they have been returning the points to DVC Owner accounts without the holding stipulation.

As DVC Owners receive their points back for the reservation, we ask if they are willing to re-rent the points to a new guest to assist us in obtaining the funds to provide that travel credit to the affected family.

I hope this helps to explain the steps our team takes in these situations! Should you have any additional questions, please feel free to ask. Our team is happy to assist in any way that we can.

 

[Willow Ufgood]

Resort closures caused by hurricanes do fall under our "Force Majeure" policy in the Rental Agreement.

IOW, if a hurricane takes out a resort, making it inhabitable, then the force majeur applies. It does not apply to canceled flights, closed theme parks or flooded roadways.

 

[Genie+]

IOW, if a hurricane takes out a resort, making it inhabitable, then the force majeur applies. It does not apply to canceled flights, closed theme parks or flooded roadways.

That was my interpretation as well.

Here is the full email, I wasn't sure I could post it so I edited the first reply, I didn't want to break any rules.

Thank you for reaching out!

It is very considerate of you to consider options in cases such as hurricanes preventing stays and travel.

I will let you know that our team closely monitors the status of the resorts and airports, and reach out to any and all guests affected by closures. Resort closures caused by hurricanes do fall under our "Force Majeure" policy in the Rental Agreement.

Guests who's stays are impacted by Force Majeure are provided the opportunity to cancel their stay for insurance purposes should they have the option. They are otherwise provided a travel credit valued at the same amount that they have paid for the reservation that can be used for future stays with our company as stated in the Rental Agreement.

As a DVC Owner, you would still receive the final 30% payment you are owed for a stay secured that is affected by Force Majeure. In most cases, you would need to cancel the reservation manually, and DVC would return the points to your account. Usually cancelling a stay within such a short time would result in the points being placed into holding, but in cases such as hurricanes, they have been returning the points to DVC Owner accounts without the holding stipulation.

As DVC Owners receive their points back for the reservation, we ask if they are willing to re-rent the points to a new guest to assist us in obtaining the funds to provide that travel credit to the affected family.

I hope this helps to explain the steps our team takes in these situations! Should you have any additional questions, please feel free to ask. Our team is happy to assist in any way that we can.

Thanks for sharing. It is helpful to see the wording.

 

[Mommb]

I may be unusual, but I think the cleanest fix would be if Disney enabled owners to sell points back to Disney, and they then rented the rooms via their existing booking system. They already have the infrastructure for letting the rooms, and it would dramatically improve the story for DVC owners and those renting, and do less canibalzation of their hotel business.

There is no incentive for Disney to do this. Under the existing hurricane policy, owners who have booked stays during a hurricane warning that affects the resort or their place of residence within 7 days of their trip can cancel without a penalty. If the owners want to try to arrange for someone else to use their points, they can. It is not Disney's concern to make things easier for renters or people who rent out points, because rentals do cannibalize Disney's hotel business.

 

[Sandisw]

That could be absolutely correct, I hope not for the guests, but the owner wouldn't take a hit either way I don't think. Do you?

I guess in the end the loss of money or points for any of us is trivial in the bulk of this situation.

The owner is only going to get points back if they choose to initiate a cancellation. DVC doesn’t cancel it the resort is open. So, the points will be lost if the renter doesn’t show.

And, my guess is that the majority of the owners who have no interest in getting involved in another rental, will do what I did and not cancel it. This way, I wasn’t double dipping.

Again, if owners want or can help, great. But, renters go into this with eyes wide open, for the savings and when these things happen, I just can’t agree renters should all of a sudden expect that owners have to do something that they didn’t agree to do in the first place

So, yes, the risk in renting is greater for a renter than an owner…But, brokers would have a difficult time getting owners who have to agree that any type of weather event that impacts a guest not getting there means they are out any of the fee they are owed, or have to agree to do another rental.

I know it seems harsh but there is a reason why renting saves people money and that is the risk. You simply don’t get the cancellation and rescheduling benefit you do booking with Disney.

No one should rent if they are not 100% comfortable with losing the funds, unless they are renting from an owner whose cancellation policy is more flexible.

ETA. I think most would agree that if the resort is actually closed and guests can’t check in, then the owner should be on the hook, since they can’t provide what was paid for.

 

[Aussie RJ]

I’ve always found DVC go out of their way to assist in times of urgency. We are international and have been a night late due to canceled flights, they gave those points back.. perhaps that is a one off but so far so good.
This week we had renters starting 10th, given DVC allowed cancellation without penalty. We offered the renter 100% refund. Incidentally they elected to keep the reservation.

 

[Genie+]

The two biggest hurdles I see for brokers attempting to orchestrate some type of hurricane policy -

Owners using brokers often do so for ease and simplicity. The lower $pp is worth it for those wanting a quicker more business like process. It avoids all the time spent, hand holding and potential complications that can arise during higher $pp person-to person rentals. Many owners also decide to rent only after realizing the points are in jeopardy of being wasted. Maybe their schedule doesn’t work to visit before points expire. Banked and borrowed points are commonly used on rentals. In those cases very little wiggle room remains to reschedule, even if the owner willing. 4 or 6 months might sound like plenty of time to reschedule but it’s not. The renter has to find something that works with their own schedule AND has DVC availability.

DVC’s hurricane policy waives penalties so points won’t go into holding. They might bank points outside the window but they cannot bank points already banked. Would the return borrowed points? I don’t know. They can’t do anything about availability to reschedule. If a March UY made an Oct reservation for a renter including banked points, a hurricane happens and DVC drops withholding penalty, there’s still a large issue finding a suitable trip reschedule date before Feb 28, 2025.

DVC is built around rewarding advanced planning. The scale of what brokers would need to address with mass rescheduling includes too many ‘stressed’ points. It would overwhelm. Even if they tried to switch some upcoming reservations out (doesn’t seem feasible anyway), the amount of distressed points would still leave plenty empty handed. And how could they make a policy where people are paying the same prices but there’s no consistency on who this policy helps. Luck of the draw? Basically what it is now.

 

[Sandisw]

The two biggest hurdles I see for brokers attempting to orchestrate some type of hurricane policy -

Owners using brokers often do so for ease and simplicity. The lower $pp is worth it for those wanting a quicker more business like process. It avoids all the time spent, hand holding and potential complications that can arise during higher $pp person-to person rentals. Many owners also decide to rent only after realizing the points are in jeopardy of being wasted. Maybe their schedule doesn’t work to visit before points expire. Banked and borrowed points are commonly used on rentals. In those cases very little wiggle room remains to reschedule, even if the owner willing. 4 or 6 months might sound like plenty of time to reschedule but it’s not. The renter has to find something that works with their own schedule AND has DVC availability.

DVC’s hurricane policy waives penalties so points won’t go into holding. They might bank points outside the window but they cannot bank points already banked. Would the return borrowed points? I don’t know. They can’t do anything about availability to reschedule. If a March UY made an Oct reservation for a renter including banked points, a hurricane happens and DVC drops withholding penalty, there’s still a large issue finding a suitable trip reschedule date before Feb 28, 2025.

DVC is built around rewarding advanced planning. The scale of what brokers would need to address with mass rescheduling includes too many ‘stressed’ points. It would overwhelm. Even if they tried to switch some upcoming reservations out (doesn’t seem feasible anyway), the amount of distressed points would still leave plenty empty handed. And how could they make a policy where people are paying the same prices but there’s no consistency on who this policy helps. Luck of the draw? Basically what it is now.

I think the biggest point you make is that the decision to offer points for a reservation remains with the owner no matter what.

So, they can’t really have a consistent policy that will happen since each renter is at mercy of each owner, especially if the owner can’t secure another reservation before points expire.

Also, MS will put borrowed points back, but they definitely can’t bank points a second time.

 

[zavandor]

Not all owners are strict. When Covid happened, I had three reservations rented out. One person managed to go anyway, for another I rescheduled their trip. The third lived in Germany so it was impossible for them; I re-rented the points for the lower going rate at the time and returned those money to the renter. They lost $3 pp rather than everything.
In my rental contract I write I would try to move or rent the points, but I also write it's subject to availability and I write when the points expire.

 

[Maistre Gracey]

Yet when the Member can’t go to WDW due to weather, covid, etc.. they want a refund of points from MS.

 

[Willow Ufgood]

Yet when the Member can’t go to WDW due to weather, covid, etc.. they want a refund of points from MS.

I would say that's the benefit of being a member vs being a renter. Two years ago we were delayed in arriving due to a late hurricane in November. DVC graciously refunded our points for the days we missed and then banked them even though we were well past the banking deadline for our December UY. We fully expected to lose those points and didn't ask for them back. It was just done for us when I called to let them know we would not be able to fly in until 3 days later.

 

[Sandisw]

Yet when the Member can’t go to WDW due to weather, covid, etc.. they want a refund of points from MS.

Actually, the owners have a contract that DVC has included a hurricane policy , as well as discretion to waive holding, etc, which explains what will happen in case it applies. That’s why there is a difference.

If renters want protection then they need to find owners who are renting willing to offer that protection, or find insurance to cover.

Plenty of owners out there who do include flexibility into the contracts. Brokers may not offer that level of flexibility.

 

[Genie+]

An owner booking a reservation one month before points expire can get the same $16pp as another owner booking a reservation 18 months from technical expiration. Right now ALL points are the same (not including home priority differences) - a renter is locked in and how much time is left until points expire doesn’t matter at all.

A broker would need to change the way they value points first. I doubt they’d want to shine a light that illustrates this aspect. Most renters remain blissfully unaware. Once you open the door for the ability to reschedule, this difference between point life becomes crucial. Brokers couldn’t pull this off without renters noticing there are better and worse points, which could impact demand on those ‘shorter life’ points.

People mention how renting points is somehow a better value than ownership. Doesn’t take all this kind of stuff into consideration. An owner can plan ahead and control how much flexibility they leave in their usage. Room to pivot. Renters can be stuck with terms like this: https://dvcrentalstore.com/wp-content/uploads/DVC-Rental-Store-Sample-Rental-Agreement.pdf

“18. Liquidated Damages for Guest Claims Against Intermediary. Should accommodations not be available on the first day of the Reservation due to an action or omission by Member, including but not limited to negligence on the part of Member, and after communication between Guest and Intermediary, and suitable comparable accommodations for the same dates cannot be secured by Member, Guest will be entitled to receive a refund limited to the Point Use Rate actually paid, which Guest and Intermediary agree shall serve as liquidated damages as to any actual or potential claim that Guest could make against Intermediary, and shall be the sole and exclusive remedy for any claim of damages against Intermediary available to Guest in such event, due to the impossibility of determining what damages Guest could actually incur or claim under such circumstances at the time of entering into this Agreement.”

Oops, somebodies new ex just a booked a different trip using a renter’s points. That would stink on check-in day but even if the renter noticed 3 months prior, their plans are heavily disrupted by that point. The terms just say they get their money back.

There’s alot of trust and commitment that goes with DVC rentals. People need to weight the risk/reward. Consider a Plan B.

 

[Maistre Gracey]

What is the formal hurricane policy?

I don’t recall the details.

 

[Willow Ufgood]

What is the formal hurricane policy?

I don’t recall the details.

https://disneyvacationclub.disney.go.com/faq/pre-arrival-checklist/hurricane-policy

 

[Maistre Gracey]

View attachment 902965
https://disneyvacationclub.disney.go.com/faq/pre-arrival-checklist/hurricane-policy

Thank you.
In that case, double shame on the renters who get points back, but do not pass that along to their rentee.