Scared of ROFR

[csmommy]

Hi all. We are VERY seriously looking to purchase a small, 50-75, DVC for the very first time & are scared. In reviewing the ROFR thread it looks like non-members are being ROFR. Is there a trick to this? Any advise & sent our way will help.

 

[iankh]

I recommend that the sale be structured with the seller paying closing costs and then build that into the purchase price. It raises the purchase price and makes it far less palatable for Disney to buy.

I just sold a small 25 point OKW contract and the buyer and I did this and it passed ROFR without a problem.

 

[CarolMN]

Make sure your offer is enough to get past ROFR - even if you have to offer more than the seller is asking. Disney is not exercising ROFR on every sale.

You can get an idea of what to offer by reading the ROFR thread and/or by asking a broker who specializes in DVC resales. Our sponsor (The Timeshare Store aka TSS) comes highly recommended, and you may contact him through the links at the top of the forum.

Best wishes -

 

[rogerram]

I recommend that the sale be structured with the seller paying closing costs and then build that into the purchase price. It raises the purchase price and makes it far less palatable for Disney to buy.

I just sold a small 25 point OKW contract and the buyer and I did this and it passed ROFR without a problem.

Disney looks at all aspects of the contract, including closing costs . The contract is submitted for ROFR, so there can be no hidden costs. If there are no closing costs, it is stated that way.

 

[Inkmahm]

Disney looks at all aspects of the contract, including closing costs . The contract is submitted for ROFR, so there can be no hidden costs. If there are no closing costs, it is stated that way.

So if Disney ends up buying a contract from ROFR, they have to pay the same closing costs on it that I would? I thought they'd just pay the contract owners whatever the asking price was and handle the ownership transfer back to Disney without closing costs at all.

 

[M4travels]

So if Disney ends up buying a contract from ROFR, they have to pay the same closing costs on it that I would? I thought they'd just pay the contract owners whatever the asking price was and handle the ownership transfer back to Disney without closing costs at all.

There would be no closing costs if Disney excercised ROFR.

In the contract that Iankh was speaking of, there were no hidden costs as it was specifically written in the contract that the seller would pay the closing costs (assuming Disney waived their ROFR).

Michael

 

[abner1776]

Soooo..let me understand this...

If a buyer and seller agree to a price of say $95/point but it includes the hidden closing cost of say $4/point(seller to pay closing costs) and Disney exercises ROFR, will Disney pay the seller $95/point or $91/point ??

If Disney is only going to pay $91/point, then having the "seller" pay the closing costs accomplishes nothing.

 

[RobDoc]

Soooo..let me understand this...

If a buyer and seller agree to a price of say $95/point but it includes the hidden closing cost of say $4/point(seller to pay closing costs) and Disney exercises ROFR, will Disney pay the seller $95/point or $91/point ??

If Disney is only going to pay $91/point, then having the "seller" pay the closing costs accomplishes nothing.

The closing costs can't really be "hidden"- it must be included in the offer if the seller is going to pay that. If Disney opts to exercise their ROFR, they must agree to the same terms already agreed to by the seller. If the seller has agreed to pay closing costs, Disney might still "allow" those costs to be borne by the seller if they take it by ROFR. (If the buyer pays closing costs, DVC can easily handle that since they do it everyday already - if the seller will pay the costs, DVC is likely to let the seller still pay those costs. The cost is there for someone to pay.)

In the example cited here (if Disney exercised ROFR) , the owner would be paid $95 per point by Disney, but would still have to pay the closing costs - whatever they turn out to be.

 

[M4travels]

Soooo..let me understand this...

If a buyer and seller agree to a price of say $95/point but it includes the hidden closing cost of say $4/point(seller to pay closing costs) and Disney exercises ROFR, will Disney pay the seller $95/point or $91/point ??

If Disney is only going to pay $91/point, then having the "seller" pay the closing costs accomplishes nothing.

If what is being offered breaks down to $95 per point and Disney exercises their ROFR, they would pay $95 per point.

ETA: Webmaster Doc, thank you for correcting me on closing costs paid by Disney.
M

 

[JimMIA]

Hi all. We are VERY seriously looking to purchase a small, 50-75, DVC for the very first time & are scared. In reviewing the ROFR thread it looks like non-members are being ROFR. Is there a trick to this? Any advise & sent our way will help.

When I read your post and then look at the ROFR thread, I get scared too! With a small contract, I think the relevent question is really "How badly do I want this?"

By my reading of the ROFR thread, you have to pay mid-90s or higher to have any confidence about clearing ROFR. And even then, you might get ROFR'd. When they ROFR VERO (!) at $87, you have to know they are trying to get small contracts out of their system, almost no matter what the cost.

On the bright side, on a 50 point contract, $10 per point is only $500...