He must be renting out his own points with those terms and can get someone to pick up the same reservation for the other 50%. I can't imagine any owner agreeing to those terms. If they are less than four months out from the end of their use year, they can't bank those points and have to use them or lose them.
I feel very comfortable working with this team so I emailed them and asked them how their cancellation policy can be different than the everybody else that is doing this. I had this response back in 30 minutes.
In regards to the cancellation, this is how it works:
The cancellation policy leaves enough time that we should be able to "resell" the points. If we can't "resell," we actually lose money. That's business. Then again, very few trips result in even the thought of cancellation.
With all the math, future payments, profit margins, etc., if we couldn't resell a trip, we lose about 10 percent of its value - so it's not going to put us out of business.
We would just chalk a cancellation with an inability to resell as an expense - not dissimilar to the electric bill or advertising. In fact, the DVC member always gets to keep his/her payment(s) to that point. After all, the DVC member did his/her part. Like I said, it's business. Plus, the likelihood of a client rebooking with us at some point in the future is pretty good if they get something back financially.
We also like to think we differentiate ourselves and attract a client base that is a little more comfortable booking with us because we at least give them something in the event of a cancellation.
Please let me know if you have any other questions regarding how they work. Like I stated, I am very pleased with them and will use them again.