Resale Question: Pay Maintenance Fees Up Front?

[candyls1]

When buying dvc resale, do I have to pay the annual dues (maintenance fees) upfront? Wasn't sure if I could pay them monthly, or when they are due for that year (Jan), or if I have to pay them upfront when purchasing resale points. Or does it depend on the time of year that I buy? TIA!

 

[Bing Showei]

If you are paying for current UY points on your resale contract, title company will add that to your final total balance.

For example, your resale contract for an VGF Aug UY contract has 200 points coming in 2018. Seller says you pay ADs on those points. Upon closing, title company will add $1,226.58 (200 x $6.1329) to your contract balance to close.

In this instance, you pay 2018 ADs immediately.

As you near the end of 2018, title companies will collect 2019 dues as part of closing. This language will be in your contract.

In this instance, you pay 2019 ADs immediately.

If you don’t have ADs due until 2019, and will be paying to Disney directly. You can elect to pay those dues monthly, or I lump sum.

 

[candyls1]

So, if I purchase resale in the fall 2018 and the UY has already passed, will the 2018 ADs already be paid (since they are due in Jan)?

I think I'm confused...I guess I thought all annual dues were due in January, regardless of the UY.

 

[Bing Showei]

On a resale contract that is not in arrears on dues, the dues on 2018 points have been paid by the seller (irrespective of UY). If you agree to pay ADs on those points, you would be paying the seller back what they paid to Disney, and you would have to pay that at closing.

If you do not need to pay dues until 2019, you will be paying directly to Disney.

 

[candyls1]

Gotcha! I get it now. I didn't know there was so much to know about buying dvc!! Thanks for your patience!

 

[Cyberc1978]

I can add that if you want to pay annual dues monthly you can only do so for next years annual dues starting with 2020.

As we approach 2019 you can set up your account to pay the 2020 annual dues each month starting jan 2019.

You won’t have that option for the 2019 annual dues.

 

[Bing Showei]

I can add that if you want to pay annual dues monthly you can only do so for next years annual dues starting with 2020.

As we approach 2019 you can set up your account to pay the 2020 annual dues each month starting jan 2019.

You won’t have that option for the 2019 annual dues.

This is not accurate. On January 15, you can either pay your dues lump sum for 2019, or pay your 2019 dues over the course of 2019 if you set this up with Disney by November of 2018.

You wouldn’t be paying your 2020 ADs, monthly or otherwise, until 2020 after the ADs are adopted by the board in December of the previous year (for 2020, that would be Dec 2019).

But Cyber1978 is right that if you don’t set this up prior to end of 2018, you want be able to do monthly payments until 2020.

 

[Jason@dvcstore]

When buying dvc resale, do I have to pay the annual dues (maintenance fees) upfront? Wasn't sure if I could pay them monthly, or when they are due for that year (Jan), or if I have to pay them upfront when purchasing resale points. Or does it depend on the time of year that I buy? TIA!

As a buyer when you purchase you will typically have the agreed upon purchase price, the closing costs and the dues on the points you are getting from the current year (dues paid in one lump sum). Typically towards the end of the calendar year you will see a lot of listings that say "NO ANNUAL DUES UNTIL 2019" even if the listing has points from 2018. Of course, on a resale transaction the purchase price, the closing costs and the annual dues are negotiable.

I hope that helps.

 

[candyls1]

As a buyer when you purchase you will typically have the agreed upon purchase price, the closing costs and the dues on the points you are getting from the current year (dues paid in one lump sum). Typically towards the end of the calendar year you will see a lot of listings that say "NO ANNUAL DUES UNTIL 2019" even if the listing has points from 2018. Of course, on a resale transaction the purchase price, the closing costs and the annual dues are negotiable.

I hope that helps.

It does, thanks! So does that mean that the end of a calendar year may be a good time to buy resale, or not necessarily?

 

[Mumof4mice]

When buying dvc resale, do I have to pay the annual dues (maintenance fees) upfront? Wasn't sure if I could pay them monthly, or when they are due for that year (Jan), or if I have to pay them upfront when purchasing resale points. Or does it depend on the time of year that I buy? TIA!

I have found sellers more likely to accept a full price offer with no reimbursement of annual dues (which they paid back in January) than an offer $5 per point below asking. It doesn't hurt to try. Good luck!

 

[Cyberc1978]

This is not accurate. On January 15, you can either pay your dues lump sum for 2019, or pay your 2019 dues over the course of 2019 if you set this up with Disney by November of 2018.

You wouldn’t be paying your 2020 ADs, monthly or otherwise, until 2020 after the ADs are adopted by the board in December of the previous year (for 2020, that would be Dec 2019).

But Cyber1978 is right that if you don’t set this up prior to end of 2018, you want be able to do monthly payments until 2020.

Thanks - I always thought that if you wanted to pay monthly you could only do so for the upcoming year and not current year.

 

[drusba]

You can negotiate for anything that might cost money on a resale contract, including how dues are paid. An owner can either pay dues at the beginning of the year (by mid Feb) for the year in full or can be paying dues monthly via automatic withdrawal from a checking account. In either case, when a sale occurs, dues for the year need to be paid off at or before closing if not already paid. Thus, when facing a resale contract, you should specifically find out what the owner's dues situation is.

As part of any offer, you should decide what to offer in relation to dues. If you do nothing, it will be presumed that you will pay the dues for the year if there are points in your year and thus you will have an extra charge to pay at closing. However, you can offer otherwise. A typical split, often done, is to split the responsibility for the annual dues pro rata for the year based on month of closing. However, if you are purchaser, you may not even want to do that if the contract does not have most of the current use year points. For example, if you are not getting points until the next year, you may insist on seller paying for all dues for the sale year and even some amount for part of the next calendar year (as an offset to purchase price) until your use year begins.

After your sale is complete and you are officially recognized as a member (which itself can be weeks after the closing), you can then set up paying future dues via automatic withdrawal from your checking account but you need to do that well before the end of a year to have it in place for the next year.

 

[Bing Showei]

However, if you are purchaser, you may not even want to do that if the contract does not have most of the current use year points.

I'm amazed that, with one particular broker, the seller paying ADs on points borrowed and used from a future UY is not automatically assumed.

While other brokers will explicitly state this on their listings (seller pays for x points on 2019 dues), this particular broker will put the onus on the buyer to negotiate a $/pt price that reflects seller paying for those points that the seller used. Supposedly the asking price reflects the missing future UY points, but it never values them appropriately and so when the buyer accounts for the missing points; essentially dues they'll have to pay and time lost to use the contract.

It starts the buyer in compromised place going into negotiations, but leaves them plenty of room to belly ache about how you're too far from asking (which they of course do).

 

[Chuck S]

Think of it like buying a house. Even though the current property taxes are paid, they are prorated and your portion is payable at closing. Unless otherwise negotiated with the seller.

 

[Jason@dvcstore]

It does, thanks! So does that mean that the end of a calendar year may be a good time to buy resale, or not necessarily?

Not necessarily. Personally, I don't think there is a "perfect time" to buy resale. I think when you see the right listing with the right amount of points you should pursue the listing.