New restrictions on resale contracts coming!?!? (Nothing official)

[chrisaman]

We toured the poly bungalows today with my family because they are thinking of becoming members and our salesman said that there are some new restrictions coming that will negatively affect people who buy resale. He said that we would be okay because we would be grandfathered in but pretty soon they would be announced. Has anyone heard anything about this and what he may be talking about? Is this a common thing that these guides say to try to keep u from buying resale?

 

[supersnoop]

He's a timeshare salesman. You can rest assured that everything he says falls somewhere between "stretching the truth" and "outright lie."

 

[KAT4DISNEY]

He's a timeshare salesman. You can rest assured that everything he says falls somewhere between "stretching the truth" and "outright lie."

Yep.

If you were looking at Poly though why would he speak of you being grandfathered in? That's direct.

 

[Minniesgal]

This old chestnut....

 

[chrisaman]

He was talking about our current contract. We have a VGC that we bought resale. Just was curious because it would make me consider adding on resale sooner rather than buying direct. I think it had the opposite effect from what he was looking for

 

[intertile]

There was rumors when VGF came online of new restrictions. Nothing ever materialized. I really don't see what they could do to restrict resale further.
1)They can't change the 11-month booking priority for home resort
2)They can't remove any of the existing DVC clubs from the "club"
3)They need to offer something to transfer out to, i.e RCI or interval

They only thing I could see them messing with is the 7 month window for non-home resort reservation, perhaps reduce it to 5 or 6 or resale contracts. All that would do is reinforce that you should buy were you want to stay.

 

[Lyn07]

We were told that if we bought resale (from a salesman) that Disney would not approve the sale and immediately buy it from under us. He also mention restrictions were coming to resales in the near future ( this was over a year ago) and the only way to go was buying direct. Since then we are happy owners of a resale and have not seen or heard of any changes. I also have to say that half way through our sales pitch we found it quite comical when we were being told very bad exaggerated stories about resales!

 

[supersnoop]

There was rumors when VGF came online of new restrictions. Nothing ever materialized. I really don't see what they could do to restrict resale further.
1)They can't change the 11-month booking priority for home resort
2)They can't remove any of the existing DVC clubs from the "club"
3)They need to offer something to transfer out to, i.e RCI or interval

They only thing I could see them messing with is the 7 month window for non-home resort reservation, perhaps reduce it to 5 or 6 or resale contracts. All that would do is reinforce that you should buy were you want to stay.

They can change those things, but they can't make them different for resale versus direct. Even the 7 month window; it can't be different based on how you purchased. Anything that is paid for by dues must remain consistent. The only things that can be different are those "benefits" funded by DVD, the sales organization.

 

[disneynutz]

We never thought that Disney would penalize it's guests/members for buying resale but they found a way to do it and they did. We never thought that buying resale would be delayed for 90 days plus but it is.

If Disney thinks that additional penalties will increase their direct sales and profits, I wouldn't put anything past them.

One thing that I really don't like about DVC is that it makes it really clear that Disney cares more about making money than making magic for DVC members.

Bill

 

[Dean]

There was rumors when VGF came online of new restrictions. Nothing ever materialized. I really don't see what they could do to restrict resale further.
1)They can't change the 11-month booking priority for home resort
2)They can't remove any of the existing DVC clubs from the "club"
3)They need to offer something to transfer out to, i.e RCI or interval

They only thing I could see them messing with is the 7 month window for non-home resort reservation, perhaps reduce it to 5 or 6 or resale contracts. All that would do is reinforce that you should buy were you want to stay.

As I interpret the legal paperwork and FL statutes, they can't make 1 or 2 different between resale and retail without possibly starting up a VIP program that likely would have to grandfather current owners included restricted owners and this applies to the non home resort window currently 4 months. 3 is not a requirement nor do I think it's a necessity either for DVC or the member, they could change that. One can always deposit with any independent exchange company that will take it.

 

[DebbieB]

There was a rumor a couple of years ago that resales would be restricted to their home resort. Most likely started by salespeople.....

 

[southerngirl528]

Anyone know the status of those 2 new laws passed on timeshares here in Florida? I truly know little about them except that a friend that actually works for DVC was really concerned that the laws had passed.

According to my understanding of my contracts from over 2 decades ago, DVC can change almost anything they want on our memberships if they choose. Resales didn't used to be restricted at ALL. They could book Concierge Collection, or whatever. That changed several years ago, and now resale owners are restricted to using their points only at DVC resorts or through RCI, is that not correct?

If a DVC salesman was just blowing smoke, then shame on him/her. More and more DVC is hiring typical "timeshare" salespeople as their own DVC salespeople. LOTS of them. And it is changing the culture. I still have a truckload of friends and acquaintances that work for DVC.

 

[southerngirl528]

Just found this after a google search:

"This was sent to me as the specific breakdown of why this should NOT pass...note that this is an independent opinion:

Quote:
Issues in Order of Priority – HB 453 – Civil Justice Subcommittee Major Issues and corresponding page/line numbers

Lines 125 – 130 open the door to “substantial compliance” being enough to enforce the timeshare instrument and allows for “violations” to be immaterial, non-actionable and non-rescission worthy.

Lines 427 – 430 empower the developer to make unilateral substitutions or deletions of inventory without a quorum vote or a consultation of owners. The deleted language in

Lines 430-437 remove the court’s supervision of such activity, which circumvents checks and balances.

Lines 665 – 669 further removes this voting requirement and court oversight for substitution or deletion of accommodations or facilities. In our opinion, this is unconstitutional because it limits access to courts and violates the due process rights of existing owners, who lose the benefit of the bargain they received when they purchased initially.

Lines 519-544 provide that the term of a timeshare plan may be extended or terminated at any time by a vote or written consent, or a combination thereof, of a majority of all the voting interests in the timeshare plan. These statutory changes allow the timeshare industry more flexibility in controlling the property interests and use rights of the existing and prospective purchasers so as to allow for overselling, improper substitution of accommodations to increase occupancy of the collective timeshare properties, and in sum, a reduced benefit of the bargain. In our opinion, this is a due process issue in violation of the Constitution because it allows for the taking away of contractual, bargained for rights, after the fact, without compensation.

Lines 795 – 800 open the door to nondisclosure of lack of utilization of timeshare for purchaser (i.e. the term the accommodation is actually available) as immaterial. This allows for violations of this section to be permissible as immaterial and non-actionable. By allowing these changes, the legislature is allowing other statutes already in existence to be violated.

Pg. 34 – Lines 861 – 865 allows the timeshare instrument to control the right to consent of purchasers to these substitutions, which are unforeseeable and not contemplated by the purchaser at the time of purchase. Purchasers will contract away rights before realizing they had them.

Pg. 34 – Lines 869 – 880 seems like an attempt at limiting the unilateral substitution rights of the developer, but the developer can work around with a quorum vote. Pg. 35 continues with different levels of stringency depending on the level of unilateral control of the developer, managing entity and common ownership or control. All of these factors are able to be worked around by the developer or managing entity because Lines 909 – 913 take away all the supposed rights inured to the purchasers by stating “This subparagraph does not apply if the timeshare instrument provides that purchasers do not have the right to consent to any proposed substitutions. 5. This paragraph does not apply if the proposed substitution is approved in advance pursuant to paragraph (f).” Paragraph (f) on page 36-37 then states that “The person authorized to make substitutions may make unlimited substitutions in a given year without compliance with paragraphs (d) and (e) if a proposed substitution is approved in advance by a majority of purchasers of the multisite timeshare plan voting in person or by proxy at a meeting called for that purpose, provided that at least 25 percent of the total number of purchasers cast votes.” So this negates all of the statutory language preceding that seemingly protects purchasers, by permitting the developer to gain prior approval to “proposed” substitutions (meaning the substitution proposed will not have to comply with the substitution actually made).

Backtracking to the middle of page 36, lines 920 – 926: this paragraph puts the onus back on the purchasers to then affirmatively file a written objection within 21 days after the notice of substitution (which is certain not to comply with the “proposed” substitution).
Page 38 – Lines 967 – 975 state that as long as the “person authorized to make substitutions’ (i.e. the developer) fully complies with these provisions (easily done by negating the rights of purchasers via the timeshare instrument, proposing a favorable substitution, then altering it to be more favorable to the developer), the trustee may convey title to any accommodations and facilities that have been designated or approved for substitution without any further vote or other authorization of the purchasers of the multisite timeshare plan. This writes around a trustee’s duty of loyalty to the purchasers and puts control in the hands of the developer.
Lines 861 – 975 allow the timeshare instrument (contract) to control over statute by allowing the developer unilateral substitution rights over the consent of purchasers. These sections also allow a trustee to violate statutorily mandated fiduciary duties under §736.08.

Lines 113-114 remove the resort’s delivery requirement to provide amendments to the public offering statement (POS) for a component site of a nonspecific timeshare plan.

Lines 548 – 580 are especially onerous as they allow for the transfer of all personal customer information of hotels or other properties that are converted to timeshare by way of managing entity changes. This gives the timeshare resort free, targeted leads by way of the change in managing entity without concern for whether those previous customers would consent to such sharing of their personal information. Section (c) also provides for a pass-through of all costs associated with the transfer of this information to the purchasers as a common expense of the timeshare plan.

Line 705 states that Section 721.54 will be repealed. This means that it is no longer a violation to represent to a purchaser of a nonspecific multisite plan that the term of purchaser’s plan is longer than the shortest term of availability. For example, this permits a resort to sell two weeks of inventory when only one week is actually available.

Lines 745-747 will raise taxes on existing timeshare owners by expanding the definition of “common expenses” under the statute.
Lines 849 – 855 open the doors for resort location transfers, leaves the definition of “improved” open to interpretation (i.e. Is a suite in a somewhat less desirable location an “improvement” to the bargained for room in Orlando?)

Lines 993 – 996 allow for the one to one requirement to be expanded to apply across all multi-site accommodations, rather than just at the one bargained for property. "
__________________

There is a very informative conversation/thread on this brand new FL legislation to be found under "Florida Timesharing" on another TS site. And for those of us that own TS in FL, cause for possible concern it seems….

 

[supersnoop]

Anyone know the status of those 2 new laws passed on timeshares here in Florida? I truly know little about them except that a friend that actually works for DVC was really concerned that the laws had passed.

According to my understanding of my contracts from over 2 decades ago, DVC can change almost anything they want on our memberships if they choose. Resales didn't used to be restricted at ALL. They could book Concierge Collection, or whatever. That changed several years ago, and now resale owners are restricted to using their points only at DVC resorts or through RCI, is that not correct?

Yes, DVC could change many aspects of the system, but they could not make a distinction between resale and direct with those changes. DVC has a duty to all owners, so any changes that favor one group over another would open them to legal action and potentially cause the current management to lose control.

My understanding of the legislation is that it would allow DVC to unilaterally extend the expiration of some resorts, but I saw nothing that would allow them to charge owners for that extension. I'm not particularlly worried about it.

 

[southerngirl528]

My understanding of the legislation is that it would allow DVC to unilaterally extend the expiration of some resorts, but I saw nothing that would allow them to charge owners for that extension. I'm not particularlly worried about it.

Sure hope you are right on that, Supersnoop. My buddy at DVC who is generally super knowledgeable about all sorts of stuff, said he was concerned the new law would allow them to charge owners for the extension without option. I have only begun to start reading up on this new stuff, so for now, I like going with what YOU said!

 

[Sammie]

We never thought that Disney would penalize it's guests/members for buying resale but they found a way to do it and they did. We never thought that buying resale would be delayed for 90 days plus but it is.

If Disney thinks that additional penalties will increase their direct sales and profits, I wouldn't put anything past them.

One thing that I really don't like about DVC is that it makes it really clear that Disney cares more about making money than making magic for DVC members.

Bill

I am sorry you feel that way, Bill. If we did we would sell. We have had magical trips every time we have gone. When we don't they will not continue to get our money.

 

[BWV Dreamin]

We never thought that Disney would penalize it's guests/members for buying resale but they found a way to do it and they did. We never thought that buying resale would be delayed for 90 days plus but it is.

If Disney thinks that additional penalties will increase their direct sales and profits, I wouldn't put anything past them.

One thing that I really don't like about DVC is that it makes it really clear that Disney cares more about making money than making magic for DVC members.

Bill

Disney gave no warning prior to the previous re sales contracts restrictions ( actually I did a month prior here on the DIS). I absolutely would consider further restrictions forth coming and would not be quick to dismiss this as rumor. There is a widening gap between resales and direct and Disney is not going to leave money on the table. The only way Disney can continue to increase direct pricing is to "affect" resale pricing thus eliminating its competition. Easiest way to do this is to further resales restrictions.

 

[Dean]

Disney gave no warning prior to the previous re sales contracts restrictions ( actually I did a month prior here on the DIS). I absolutely would consider further restrictions forth coming and would not be quick to dismiss this as rumor. There is a widening gap between resales and direct and Disney is not going to leave money on the table. The only way Disney can continue to increase direct pricing is to "affect" resale pricing thus eliminating its competition. Easiest way to do this is to further resales restrictions.

This is certainly one way but there are others, likely better from an effectiveness standpoint. There are more restrictions they could put in place though that would indirectly affect price. There other way, and likely the better option anyway, is to be more aggressive in in scheduling sales tours and during the sales process. IMO there is a lot they could do here and remain professional, other top companies do so including Marriott and Hilton. Second tier companies are even more aggressive and as a group, unethical in their sales. IMO one needs to be able to hold their nose related to sales and separate that aspect out mentally in order to participate with timeshares anyway, including Disney.

 

[MouseMomx2]

One thing that I really don't like about DVC is that it makes it really clear that Disney cares more about making money than making magic for DVC members.

DVC is a company. It is in business to make money, not to make magic. Knowing and accepting this, before anything else, is (IMHO) the key to seeing all the magic that DVC does make. We bought in 1997 and have had magical stays every time we have used our DVC membership. We have seen changes, both positive and negative, over the years but none have ever made us question our purchase. In fact, we doubled our points just a few years ago. We understand that certain rules/changes (no more free valet parking as membership numbers increased, etc.) must be made so that the company will make money, and we understand that certain things have changed (no more peach towels at OKW, no unique dishes in the resorts, etc.) both for financial reasons and because of guest pilfering. I could go out and sell my initial contracts today for more than I paid for them nearly 18 years ago and that is, in part, because DVC has made sound financial decisions and the product is still valuable.

As I was always told, if you look for the bad you'll find it, but if you look for the good you'll probably find that instead.

 

[Brian Noble]

Disney is in the business of selling happiness. That's not quite the same as "Disney wants me to be happy," but it is easy to confuse the two.