Not-so-newbie questions

[Ukhieneman]

After reading this forum for over a year, this is my first post.

After taking the tour on our honeymoon in 08, DW and I really considered buying direct. But since we didn't own a house, we realizes how irresponsible that was an waited. Lucky for us, we learned about resale. We have 2yr old DDs, and are considering a stripped BLT contract for their first trip in a few years. This forum has answered most of my questions, but I had a few about making an offer.

1) Since the contract is stripped and only 100 pts, how likely is a small, stripped contract at a low-end offer (based on the sticky thread) to be ROFRed?

2) Are the majority of sellers willing to negotiate, or are they fairly firm in price?

3) Is there any way to calculate a rack rate for the stripped points? When making an offer, I want to be able to justify my price.

Thanks in advance for all of your advice!

 

[JWG]

1) Since the contract is stripped and only 100 pts, how likely is a small, stripped contract at a low-end offer (based on the sticky thread) to be ROFRed?

There is no rhyme or reason to this, though I imagine stripped contracts are of little use to Disney because they cannot easily fill a waitlist with these. If the use year is still coming up and no points are available, they can't really sell that until the start of the use year has passed. Meaning, if it's an August contract with no points until 2014, they can't sell it as new/direct until September when the next use year is 2014.

2) Are the majority of sellers willing to negotiate, or are they fairly firm in price?

Depends on the seller. Those locked into financing likely have to/want to pay off the balance and will be more firm. Smaller contracts have less flexability. I recently negotiated a BLT contract down $5 per point and also lost on one where they wouldn't. If the won't, you can always come up if you're willing - no different than a house. If they don't accept the broker will tell you and you can come back with something different.

3) Is there any way to calculate a rack rate for the stripped points? When making an offer, I want to be able to justify my price.

Look at the point charts to see what you'd book with those points and then compare to the cash reservation price. You have to use 2013 as 2014 is not yet available, but that's close enough. Odds are, you won't be able to negotiate down that much. Not sure what you're seeing, but going price for BLT has been in the $90-$115 range depending on number of points. I have a 50 point in the ROFR process (please pass!! ) for $105. I lost out on some 25 point contracts to other buyers for $115 (wouldn't go that high). I would imagine 100 points would be in that $90-$100 range since stripped. If you're getting better, that's great.

 

[JimMIA]

Especially with such a small contract, in this market I would not be overly concerned with squeezing every penny out of the seller.

A much more important consideration if you find a contract that perfectly fits your needs is to PASS ROFR.

There has been a long lull in Disney exercising ROFR, only recently resumed, and during that lull many have forgotten the tearful threads of those who negotiated too hard just a couple of years ago. They lost perfect contracts to ROFR, often for less than a couple hundred bucks. They lost; Disney won.

That's sad, but it's also self-inflicted.

I would focus on getting what you want...at a fair price...that will clear ROFR.

 

[NoleFan]

Especially with such a small contract, in this market I would not be overly concerned with squeezing every penny out of the seller.

A much more important consideration if you find a contract that perfectly fits your needs is to PASS ROFR.

There has been a long lull in Disney exercising ROFR, only recently resumed, and during that lull many have forgotten the tearful threads of those who negotiated too hard just a couple of years ago. They lost perfect contracts to ROFR, often for less than a couple hundred bucks. They lost; Disney won.

That's sad, but it's also self-inflicted.

I would focus on getting what you want...at a fair price...that will clear ROFR.

I totally agree with this. Perfectly stated !!

 

[ELMC]

Especially with such a small contract, in this market I would not be overly concerned with squeezing every penny out of the seller.

A much more important consideration if you find a contract that perfectly fits your needs is to PASS ROFR.

There has been a long lull in Disney exercising ROFR, only recently resumed, and during that lull many have forgotten the tearful threads of those who negotiated too hard just a couple of years ago. They lost perfect contracts to ROFR, often for less than a couple hundred bucks. They lost; Disney won.

That's sad, but it's also self-inflicted.

I would focus on getting what you want...at a fair price...that will clear ROFR.

Six months ago I would have (and did) disagree with just about everything in this post. But times are different, and we must change with the times. If your goal is to get a specific contract, it wouldn't be the worst thing in the world to pay a bit more and hope that helps you clear ROFR. Although we have no first hand knowledge about what criteria Disney uses to make its ROFR decisions, one can infer that price is a strong determining factor. Six or twelve months ago I said that paying extra just to clear ROFR was a waste of money. Nowadays I call it buying insurance.