Interest Rates with Disney Financing

[prncssjas]

Hi everyone! I am so grateful for everyone's help so far but I have a couple more questions.

First, when you finance with Disney and you pay interest --is the interest rate applied the same way as a mortgage (ie, pay interest at first, then the prinicpal)? Does this question make sense? I guess what I am trying to ask is if I decide to put down 20%, and I get an interest rate of 10% for 10 years, is Disney tacking on 10% on the total or am I just paying interest only for the first few years??

I hope this makes sense...I suppose I could wait and see what my packet of info says but any help from you guys would be great!!

Thanks,
Rima

*** Biggest Aladdin Fan in the WORLD!!!***

12/79 Day Guest
7/84 Day Guest
7/88 Disneyland
7/95 Off Site
1996 Cast Member
2/97 CBR
9/00 GF-HONEYMOON
11/01 GF Concierge

 

[travelbug]

I financed with Disney last year. It works like a mortgage. You will be paying mostly interest at first, and then more and more principal as you go along. Like you, I sure WISH they were only adding on 10% of the total! Unfortunately it's a lot more than that.

Don't forget that you can prepay by sending in extra payments (any time, pretty much any amount). That gets applied strictly to the principal, which of course decreases the total interest you'll pay as well as how long you'll be paying. That's what I've been doing as much as possible.

Have fun looking over your packet when it arrives!

 

[lumiereguy]

I was told by my guide that when financing through Disney, it was a simple interest loan. Is this the case or not?

 

[DVC Chris]

While I am not a financial "whiz" I will try to explain as simple as possible.

Simple interest means that interest is applied to your loan without any "special methods" (like credit card companies do... i.e.: "two-cycle daily balance", etc)....The Disney loan is amortized over whatever period you select (i.e. 3, 5 10yrs.)... Each payment is a combination of interest and principal. As you make more payments, the interest portion of the loan gets smaller and the principal part increases. You can use a program that will produce an amortization schedule that will give you an idea of how each payment is portioned out (how much to interest, how much to principal. I know quicken has a built-in loan calculator and you can probably find programs somewhere on the net.

I loan that disney is offering is the same as a basic car loan or mortgage.

Hopefully this helps... If you have any other questions, please let me know...

WL, 9/00
Treehouse Villa, 9/98
BWV, 12/95
Treehouse Villa, 7/94
Polynesian 93
Yacht Club 92
Royal Plaza 92
GF/ CBR 91
Hilton/ CBR 90
GF 89
Off Site: 88

 

[prncssjas]

Hi everyone.

Gosh--thank you SO much for helping me out with this. You guys answered my question perfectly--glad it made sense.

I really REALLY want to buy into DVC. I just need to convince my DH that he wants it RIGHT NOW too. LOL!!

Thanks again guys!

Rima

*** Biggest Aladdin Fan in the WORLD!!!***

12/79 Day Guest
7/84 Day Guest
7/88 Disneyland
7/95 Off Site
1996 Cast Member
2/97 CBR
9/00 GF-HONEYMOON
11/01 GF Concierge

 

[ez]

I think you are right, there is no time like right now. We bought in June 2000, at boardwalk, and I'm so very glad we did. We were unaware that bwv was about to be sold out, that prices would go up, and apparently, from what I've read here, come April, that magical beginnings won't be the deal it once was. The sooner you buy, the sooner you can start enjoying. Good luck! By the way, I financed thru disney (piece of cake) and was able to claim the interest I paid as a deduction, along with my home mortgage.