I messed up - and I need collective advice - ASAP - edited pg 3 with decision and Thanks

[ILoveMyDVC]

I need your collective help FAST: In order to afford my beloved OKW extended contract resale spree ( 520 points @ $118/pt), I am going to have to renege on this one
-$112-$34988-300-SSR-Apr-0/20, 519/21, 300/22, 300/23- sent 3/31.
AND LOSE THE 2K deposit.

The real estate agent wants me to go through with it and then let them resell right away because inventory is so low right now; activity is high and prices are rising. It's one of the major players and has a great rep with the DIS. What would you do???? I'm afraid of losing more than the 2K and I don't dare tell my DH it's 2k - he thinks it is 1K. (my money, I work full time and we keep expenses seperate)

Background DVC since 1994 - never bough resale until this past few eeks. Always stayed at the original Vacation Club (OKW). Also purchasing a 150 pt OKW E for $108/pt.

Thanks in advance.
I have to tell them today as in Sunday.

 

[RoseGold]

This is math, so the financing terms and how you are going to afford all of this matters. You could rent out the points and hold a couple years and maybe break even, but maybe not if you’re on some 10% timeshare finance product.

2K is a lot of money.

Or, don’t lose the deposit, just do what you said you were going to do and swap contracts in a couple years. It’s not like DVC or OKWe is going anywhere.

 

[starry_solo]

how much can you float? Maybe you can rent out the SSR points (at least the ones that expire soon).

 

[UrsulaWantsYourSoul]

Ay Carumba. Yes 2K is a ton of money. If you can swing it I'd let it go through and then resell it - you may lose a little but not nearly that much.

 

[ILoveMyDVC]

how much can you float? Maybe you can rent out the SSR points (at least the ones that expire soon).

With no dues on anyhting until January (since they are paid at closing), it is doable.

 

[ILoveMyDVC]

Ay Carumba. Yes 2K is a ton of money. If you can swing it I'd let it go through and then resell it - you may lose a little but not nearly that much.

I've seen contracts go through for less than what I paid - at least here on the DIS. Some for more and some fo rhte same...

 

[UrsulaWantsYourSoul]

haha - could also use a couple hundred points before you resell it .

 

[Starport Seven-Five]

I would back out of the 520 point OKW contract if you can without penalty. Then add on a smaller OKW contract instead.

The other option to frame this mentally is to just consider that lost deposit as part of the cost of the OKW contract. $2000/520 is ~$3.85 per point so just consider it part of the cost of the new contract. Decide if it's still worth it at that price point.

The real estate agent wants me to go through with it and then let them resell right away because inventory is so low right now;

I would be skeptical of this advice only because the agent has a vested interest. They would make 2 commissions if you bought it and then sold it again. Run your own numbers before proceeding to see if this makes any sense.

Do the math on what the fees look like and compare that to the 2k you will lose by backing out.

I'm afraid of losing more than the 2K and I don't dare tell my DH it's 2k - he thinks it is 1K. (my money, I work full time and we keep expenses seperate)

Keeping finances separate is different from being dishonest about how much a purchase costs.

 

[BlackTea]

If you go through SSR, then resell it immediately, don’t you need to pay 8% commission? Isn’t that more than 2k? It doesn’t seem to make much financial difference either way, so I would just give up the deposit to save time.
OKW should be pretty open at 7 months, it could be a good idea to keep that SSR contract, give you a second home (more flexibility) without sacrificing much on OKW side.

 

[AaronEuth]

Assuming a 8.5 percent commission (3k on 35000) and no other selling fees of any kind, you would need your SSR contract to sell for 36000 to break even on just losing the 2k. That isn't you turning a profit, that is still you losing 2k. You would need to sell it for roughly 38000 to break even and lose nothing. How likely are you to sell a large 300 point SSR contract @ 128 a point? That's what you need to do to completely break even.

I personally would just write off the 2k as part of the OKW extended. They are hard to find, and it will likely increase in value, certainly more than the SSR which are a dime a dozen.

Disclaimer I did some very minor rounding in the above math.

 

[ILoveMyDVC]

Assuming a 8.5 percent commission (3k on 35000) and no other selling fees of any kind, you would need your SSR contract to sell for 36000 to break even on just losing the 2k. That isn't you turning a profit, that is still you losing 2k. You would need to sell it for roughly 38000 to break even and lose nothing. How likely are you to sell a large 300 point SSR contract @ 128 a point? That's what you need to do to completely break even.

I personally would just write off the 2k as part of the OKW extended. They are hard to find, and it will likely increase in value, certainly more than the SSR which are a dime a dozen.

Disclaimer I did some very minor rounding in the above math.

This is my most likely path as it saves me 9K overall from my original plan. But I sure do appreciate everyone's ideas and thoughts.

 

[Sandisw]

This is my most likely path as it saves me 9K overall from my original plan. But I sure do appreciate everyone's ideas and thoughts.

I agree to cut your loses. Easy to say they can resell but what if they can’t?

The other aspect is that something could happen to your sale too.

I’m sorry you have to make this type of choice.

ETA: One thing you can do over the next year or two is simply rent or transfer some points from OKW and reduce your trips from planned and you get your $2k back.

 

[Wedgeout]

As hard emotionally as it might be, I wouldn’t proceed with that 520 OKW(E), and would enjoy all I planned doing with the SSR contract.

 

[lovethesun12]

As hard emotionally as it might be, I wouldn’t proceed with that 520 OKW(E), and would enjoy all I planned doing with the SSR contract.

This is what I would do as well.

 

[DVCanadian]

I would consider an option where you keep the SSR, strip the contract by renting all the points you can and then resell it.

 

[ILoveMyDVC]

I would consider an option where you keep the SSR, strip the contract by renting all the points you can and then resell it.

This is the option I want to learn more about.

 

[DVCanadian]

This is the option I want to learn more about.

You will probably have to hold the contract a year.
Buy it.
Rent all of the points you want to rent. When all reservations are complete, sell the contract. You will probably have to pay a year of dues along the way.

 

[princesscinderella]

I would not buy the okw (e) contract. 520 points is a lot of points in one contract and will be hard to sell if you need to do it quickly even if it is extended. I’d be patient and waiting for a smaller okw extended to come on the market especially since you already own there and have another 150 points going through ROFR now. I’d let all the resale companies know by contacting the agents that you are on the lookout for OKW e in a specific UY so they can tip you off and you get first crack at buying it. We love SSR and that’s a great contract with a ton of points. Now you would have two home bases and it’s a great thing and if big rooms is what you are after the treehouses are awesome.

$2k is a lot to walk away from and the sales process to resell it immediately I don’t think would work where you would get the money in time to close on your OKW either since they are only a month apart in the buying process, they would need to be two months apart for it to work.

 

[DVCanadian]

This is the option I want to learn more about.

Honestly, big picture the $2k is not a lot of money and may not be worth the time to do anything other than lose the deposit and move on. Consider it DVC tuition.

$112-$34988-300-SSR-Apr-0/20, 519/21, 300/22, 300/23

stripping the contract you could rent the 519 and at least half the 300 in 2022.
Rent 669 points at an average of $15 per point, so income of $10k
But you will probably need to pay a year of dues. $2200 or so?

you could also keep the SSR and rent it every year to reduce your dues on other contracts.Fairly easy to rent SSR points for double the dues at $55pp.

renting the 669 produces 10k income, apply that against the contract (minus say $2200 for a year of due) and it cost you around $27 sell it and you should do better than losing $2k but whole process would take at least a year unless you can cram a lot of rentals into the next 3-4 months.
Renting takes a lot of time, so depends on how you value your time.

 

[CraigInPA]

While the market might be "hot", traditionally large contracts take a while to sell. I wouldn't buy it with plans to immediately sell it. Likewise, I wouldn't buy it and strip the points to rent them, with the plan on immediately selling the stripped contract. Both of these are highly speculative ways to "save $2k".