Resale Closing Costs

[JimC]

Hi gang! I just received a reply from Jackie at GMAC regarding their processing fee. Here's what she had to say...

This issue of our admin fee can be quite confusing even though administrative fees are becoming quite common in all types of real estate transactions. The admin fee is used by this brokerage to offset costs related to the transaction, including fed-ex and mailing fees, credit card processing fees, office expenses, and is also used to supplement the costs for our contracts department. International Properties GMAC Real Estate is one of the few resale brokerages that operates with the belief that a client is better served and protected by having an individual other than the sales associate oversee the transaction throughout the contracts process, and then act as a second set of eyes with the title company during the closing process. Because this contract person is not compensated in the form of commission from the closed sale, they are better able to protect both parties without any type of worry over potential lost income if the sale needs to be cancelled or postponed to protect the parties. We currently have eleven employees in our contracts department, and I don't know of any other resale brokerage that makes such a commitment.

This fee also helps make it possible for IPGMAC to sell so many small point deeds. Obviously, with a 10% commission structure- there isn't much money to be made on a 25 pt OKW sale! I always laugh when people tell me that other brokers don't even bother advertising small point contract listings. We even cooperate with outside brokers on Disney sales- splitting the commission earned between two offices! This is part of the reason why our sellers get so much exposure.

In regards to the Interval International VIP memberships, these are currently being given to buyers as a premium gift when applicable, but are not directly related to the admin fee. For resort systems such as Disney, Hyatt, Club Sunterra, etc. that have a corporate Interval International membership as part of their ownership- this gift cannot be applied as it would simply duplicate the benefits already in place. In transactions where a Disney buyer already has a separate membership (for example- a Disney owner who also owns a Marriott resort and has the DVC Corporate and a second personal membership) we would add a year extension to their personal membership as a thank you for buying from us!


There ya have it ladies and gentleman!

Fees related to the transaction should be individually identified on the closing statement and should not include "office expenses" which are a cost of doing buisness for the broker. Closing costs are negotiable.

 

[CarolA]

Hi gang! I just received a reply from Jackie at GMAC regarding their processing fee. Here's what she had to say...

This issue of our admin fee can be quite confusing even though administrative fees are becoming quite common in all types of real estate transactions. The admin fee is used by this brokerage to offset costs related to the transaction, including fed-ex and mailing fees, credit card processing fees, office expenses, and is also used to supplement the costs for our contracts department. International Properties GMAC Real Estate is one of the few resale brokerages that operates with the belief that a client is better served and protected by having an individual other than the sales associate oversee the transaction throughout the contracts process, and then act as a second set of eyes with the title company during the closing process. Because this contract person is not compensated in the form of commission from the closed sale, they are better able to protect both parties without any type of worry over potential lost income if the sale needs to be cancelled or postponed to protect the parties. We currently have eleven employees in our contracts department, and I don't know of any other resale brokerage that makes such a commitment.

This fee also helps make it possible for IPGMAC to sell so many small point deeds. Obviously, with a 10% commission structure- there isn't much money to be made on a 25 pt OKW sale! I always laugh when people tell me that other brokers don't even bother advertising small point contract listings. We even cooperate with outside brokers on Disney sales- splitting the commission earned between two offices! This is part of the reason why our sellers get so much exposure.

In regards to the Interval International VIP memberships, these are currently being given to buyers as a premium gift when applicable, but are not directly related to the admin fee. For resort systems such as Disney, Hyatt, Club Sunterra, etc. that have a corporate Interval International membership as part of their ownership- this gift cannot be applied as it would simply duplicate the benefits already in place. In transactions where a Disney buyer already has a separate membership (for example- a Disney owner who also owns a Marriott resort and has the DVC Corporate and a second personal membership) we would add a year extension to their personal membership as a thank you for buying from us!


There ya have it ladies and gentleman!

Gotta give her credit. She tries to justify charging an extra $200. However, these "fees' are pretty high..... When shopping for a broker you might consider them I certainly would. (Especially since I have seen VERY small point contracts on TSS and at least ONE other major broker.... that lines about "small contracts" makes it sound like ONLY GMAC would bother with you which we know isn't true. TSS has a few 40 and 45 point contacts pending and one 31 point on thier current listing. I would bet that a lot of brokers like the small contracts, it's not a huge commison, but you get money faster. My 50 point HH sold within an HOUR of the listing.....)

I have to admit I am not surprised. When I bought my condo my realtor was with GMAC and she suggested I use their mortgage company..... However, their fees were very high so they didn't get the business.

 

[Dman67]

I'm not a penny pincher by any stretch of the imagination but I don't believe I am going to do business with GMAC for the very reason of the $195 admin fee. My first contract was through TTS and I have been very happy with the experience and the costs associated with doing business with them. I'll continue to give them my business going forward even if it means I have to wait for the right small contract to come along.

Thanks TTS

 

[RobDoc]

My apologies, Carol, I wasn't trying to be mis-leading.

However, I don't believe I ever said it the complimentary II membership through GMAC was for DVC point trades.

Actually what you said was that GMAC provides a better II membership than provided by DVC ... and again, that is just not true. Any II membership provided by GMAC could not even be used to exchange your DVC points - thus, it would be absolutely worthless to a DVC member. Even DVC members who already own other resorts that trade thru II cannot use that membership for their DVC trades.

With the Admin Fee, however, GMAC provides a better II membership than provided by DVC.

 

[Delaware Mike]

Well, as promised, here's the response from GMAC. While it seems things have changed since my last letter from them, I did promise to provide the response.

It seems there are differing opinions about GMAC, polarized one might say. My feeling is I have to be 100% comfortable with the person with whom I'm dealing, especially with the cost of DVC points, either retail or resale. Using the agency of choice is a personal decision, and I wish everyone the best of luck with their contracts and their business relationships.

Verbatim, here's Jackie's response to me:

Hi Mike,

I hope all is well. The Interval International membership is a
separate issue than the admin fee. (I've gotten several questions about
this today so your DisBoard discussion must be pretty busy!) We
currently gift an Interval International VIP membership to our buyers
whenever applicable. For buyers that buy an RCI resort, or a program
with a corporate membership (such as DVC, Club Sunterra, Hyatt, etc),
the II membership doesn't apply as it would simply duplicate the
benefits already in place. For the RCI buyers, we are currently giving
them a membership to Leisure Time Passport to give them some added
benefits and getaway possibilities. I know that management is looking
into other premium gifts to offer to our DVC and Hyatt clients.

Here is an email I just sent that will hopefully clarify the IPGMAC
admin fee:

This issue of our admin fee can be quite confusing even though
administrative fees are becoming quite common in all types of real
estate transactions. The admin fee is used by this brokerage to offset
costs related to the transaction, including fed-ex and mailing fees,
credit card processing fees, office expenses, and is also used to
supplement the costs for our contracts department. International
Properties GMAC Real Estate is one of the few resale brokerages that
operates with the belief that a client is better served and protected by
having an individual other than the sales associate oversee the
transaction throughout the contracts process, and then act as a second
set of eyes with the title company during the closing process. Because
this contract person is not compensated in the form of commission from
the closed sale, they are better able to protect both parties without
any type of worry over potential lost income if the sale needs to be
cancelled or postponed to protect the parties. We currently have eleven
employees in our contracts department, and I don't know of any other
resale brokerage that makes such a commitment.

This fee also helps make it possible for IPGMAC to sell so many small
point deeds. Obviously, with a 10% commission structure- there isn't
much money to be made on a 25 pt OKW sale! I always laugh when people
tell me that other brokers don't even bother advertising small point
contract listings. We even cooperate with outside brokers on Disney
sales- splitting the commission earned between two offices! This is part
of the reason why our sellers get so much exposure.

In regards to the Interval International VIP memberships, these are
currently being given to buyers as a premium gift when applicable, but
are not directly related to the admin fee. For resort systems such as
Disney, Hyatt, Club Sunterra, etc. that have a corporate Interval
International membership as part of their ownership- this gift cannot be
applied as it would simply duplicate the benefits already in place. In
transactions where a Disney buyer already has a separate membership (for
example- a Disney owner who also owns a Marriott resort and has the DVC
Corporate and a second personal membership) we would add a year
extension to their personal membership as a thank you for buying from
us!

I hope some of this helps. If you have any other questions- please don't
hesitate to contact me!

Sincerely,

Jackie Muenzner
Licensed Real Estate Associate
Disney Vacation Club Specialist
JackieM@InternationalGMAC.com
Toll-Free: 1-800-259-7100
Worldwide: (407) 465-5161 ext 7765

 

[CarolA]

My apologies, Carol, I wasn't trying to be mis-leading.

However, I don't believe I ever said it the complimentary II membership through GMAC was for DVC point trades.

I didn't think you were being misleading. I meant GMAC was being misleading. Sorry!

 

[Delaware Mike]

Before you do a deal with GMAC do a BBB search and a check on the broker's license.

BBB

GMAC Realty BBB report

Florida RE licensing portal

Unfortunately, I couldn't find my way through the Florida Licensing website. I know I'm doing something wrong, and I'll eventually work my way through it.

But the BBB website provided in the post refers to this agency:
Timeshare Resales USA GMAC Real Estate
7121 Grand National Drive Ste 105
Orlando, FL 32819
Orange County

The agency I used was:
International Properties GMAC Real Estate
11059 International Drive, Suite 100
Orlando, FL 32821

Are these two different companies? Afterall, GMAC is a franchise...

However, that being said, it's nice to know the BBB found all 11 listed consumer complaints against the poster's company to be "Resolved", or "Company made every reasonable effort to resolve".

Anyway, I think we've beaten this horse enough.

Shall we all part friends?

 

[Dman67]

Unfortunately, I couldn't find my way through the Florida Licensing website. I know I'm doing something wrong, and I'll eventually work my way through it.

But the BBB website provided in the post refers to this agency:
Timeshare Resales USA GMAC Real Estate
7121 Grand National Drive Ste 105
Orlando, FL 32819
Orange County

The agency I used was:
International Properties GMAC Real Estate
11059 International Drive, Suite 100
Orlando, FL 32821

Are these two different companies? Afterall, GMAC is a franchise...

However, that being said, it's nice to know the BBB found all 11 listed consumer complaints against the poster's company to be "Resolved", or "Company made every reasonable effort to resolve".

Anyway, I think we've beaten this horse enough.

Shall we all part friends?

Yea, the BBB link that was provided is for another franchise called Timeshare Resales USA. The GMAC agency that we are referring to is International Properties GMAC Real Estate.

 

[MrsNick]

JMO, but for a real estate contract that requires a second set of eyes and needs help with the title insurance company, I would prefer not to give the realtor's company an extra $195 to perform that function. I personally would take the $195 and put it towards a lawyer to represent me - that's what they do.

As for business expenses related to mailing, etc., that's a load of poo. That is a cost of business that the business should pay. I would lmao if I walked into a retailer and they said, oh, by the way, we have to charge you a $5.00 surcharge on every purchase that you make to cover our administrative expenses like packaging and shipping.

 

[JimC]

Corrected link to the BBB report for International Properties GMAC Real Estate

 

[Caskbill]

Just thought I'd add a few comments.

GMAC is a franchise, and as such I'm sure each is different, varying according the the individual management. As long as one is comfortable with the franchise they're working with, and that franchise has a good record, there should be no problems.

Some of the fees do sound wierd. Since GMAC does a 'kickback' to Disney for every contract they sell, I wonder if this is part of that so called fee they collect, which they simply categorize as an 'administrative fee'. They pay Disney this kickback of funds in exchange for getting to say they are 'approved by Disney'.

The II question seems to have been answered. It only applies to someone who already owns another, non-DVC timeshare that allows individual II memberships, and already has a personal II membership. Then in this case they offer to pay one year's membership for that person. This of course would be totallin inapplciable to a new DVC buyer who did not already own an existing, qualifying, timeshare elsewhere.

Bottom Line, one would simply need to calculate what they get (Contract size, resort, points banked or borrowed) and what it is going to cost them out of pocket to purchase it. That's what really counts.

 

[Buckeye Fan]

FWIW, I purchased 2 contracts through Jackie/GMAC. Since the seller listed their contracts through GMAC and I liked the contracts, I negotiated for the sellers to pay closing, 1 seller to pay the admin fee and I covered all 2007 MFs for both contracts. I ended up paying a total of $195, MFs + the cost of the contracts. This was cheaper than anything else I could find that would pass ROFR through resale and beat Disney's F&F promo @ $86 per point by about $800.

For anyone contemplating using GMAC, I was more than pleased with the service and knowledge of the staff. I wouldn't let the fees be an issue if you are considering a contract, as everything is negotiable.

 

[mikeandkarla]

the more I read this thread, the more likely I will go through Disney to purchase an add on. It seems that the admin. fee GMAC charges may be cause for other brokers to charge this fee in the future. But then again, it seems it may have turned a few people away from doing business with them. It just sounds fishy.

 

[Delaware Mike]

After sleeping on things, I don't know why I set myself up for more of yesterday's "fun". While I attempted to provide insight from another point-of-view, yesterday was brutal.

...but here goes:

There's another way to view how the admin fee reflects against the current retail pricing (after applicable incentives, where available). Doc points out the current retail pricing:

Direct purchase of resorts other than SSR and AKV have a pricing set by DVC.

For new purchases (minimum purchase of 160 pts.)

AKV = $104 - $8 incentive = $96
SSR = $104 - $10 incentive = $94

OKW, HH and VB = $92 (although I have also seen a report that HH and VB are now at $87)
BWV = $98
VWL = $98
BCV = $101

(Post #16 in the “Which company would you buy a resale from?” thread)

Given the current retail landscape, I compared those per-point prices against resale with a $195.00 administrative fee. I find the lower number of points someone buys in resale with a $195.00 admin fee, the greater the impact the admin fee has. Also, the resort where the points are purchased play into the analysis. For example, buying retail for points lower than 80 for OKW makes better sense than resale.

Where I’m going with this rambling is with a $195.00 admin fee, buying more than 80 points from resale makes greater sense than retail. When buying under 80 point, go retail. (I'm referring to an add-on. Yeah, and the incentive pricing doesn't apply to purchases under 160 pts either, but I had to use a price for my analysis.)

Here are the numbers. I made an assumption of $350.00 in closing costs as I don’t have exact figures for each point amount or resale agency, Also, I used $85.00 per point at resale:

Pts Pt Price Closing Adm Fee Total PP Price
50 $85.00 $350.00 $195.00 $4,795.00 $95.90
60 $85.00 $350.00 $195.00 $5,645.00 $94.08
70 $85.00 $350.00 $195.00 $6,495.00 $92.79
80 $85.00 $350.00 $195.00 $7,345.00 $91.81
90 $85.00 $350.00 $195.00 $8,195.00 $91.06
100 $85.00 $350.00 $195.00 $9,045.00 $90.45
110 $85.00 $350.00 $195.00 $9,895.00 $89.95
120 $85.00 $350.00 $195.00 $10,745.00 $89.54
130 $85.00 $350.00 $195.00 $11,595.00 $89.19
140 $85.00 $350.00 $195.00 $12,445.00 $88.89
150 $85.00 $350.00 $195.00 $13,295.00 $88.63
160 $85.00 $350.00 $195.00 $14,145.00 $88.41
170 $85.00 $350.00 $195.00 $14,995.00 $88.21
180 $85.00 $350.00 $195.00 $15,845.00 $88.03
190 $85.00 $350.00 $195.00 $16,695.00 $87.87
200 $85.00 $350.00 $195.00 $17,545.00 $87.73

Now, everyone needs to decide for themselves if the admin fee is worth it. I happen to think having another “set of eyes” on my contract, making sure all the “I’s” are dotted and “T’s” are crossed, is better. I’m willing to pay for what I believe to be a premium service. (Hey, this is my opinion, so don’t flame me.)

Oh, and someone made a remark about not being willing to pay for things that should be factored into the reseller’s overhead. I guess they don’t pay that fuel surcharge which is showing up on a lot of trash company bills lately, or that “environmental charge” (also called a hazardous waste disposal charge) found on the bill for an oil change or for replacing tires on their car either.

On a personal note after yesterday, I’m done with conversations such as this one. Yeah, GMAC changed the information they put out about II and the admin fee, and I posted the older information I received in November 2006. It was the information I had. Notice I also posted the follow-up information after I was called on it by a lot of folks.

Decide for yourself if you think the admin fee concept is a good deal. If you don’t think so, don’t use GMAC…go with somebody else.

Good luck with whatever you decide. Good-bye.

 

[bababear_50]

Sending Mike

Happy Easter ,Mike

thanks for giving me good info and being kind enough to take the time to investigate and post it.

 

[larrytau]

Great job, Mike! Thanks for your time and the great info!