Selling Points to Family (Son)

[lizanne]

One of our sons approched me this morning about buying our points. DH and I may want to consider this but I need many questions answered first. Right now we've been giving our kids (all adults) freebie vacations as far as resort. We decided that in the future we would ask $5 per point if they want to use them, that would cover our dues. DH and I haven't used the points since 2008 because of health issues.

We have three contracts xxxx.0 (270 pts), xxxx.1 (30 pts), xxxx.2 (100 pts). All are OKW.

Can we somehow add their names (Son and DIL) to a contract and then transfer ownership to them and handle the money aspect totally separate from any Disney involvement?

Can we sell them directly through Disney?

Would that be considered a Re-Sale under the new resale terms? If sold thru Disney would Disney set the price per point?

I want to give him correct information about options, and will call MS, however I know there are very knowledgeable people on these boards and thought I could get some input today.

Thanks,
Betty Anne

 

[Dean]

One of our sons approched me this morning about buying our points. DH and I may want to consider this but I need many questions answered first. Right now we've been giving our kids (all adults) freebie vacations as far as resort. We decided that in the future we would ask $5 per point if they want to use them, that would cover our dues. DH and I haven't used the points since 2008 because of health issues.

We have three contracts xxxx.0 (270 pts), xxxx.1 (30 pts), xxxx.2 (100 pts). All are OKW.

Can we somehow add their names (Son and DIL) to a contract and then transfer ownership to them and handle the money aspect totally separate from any Disney involvement?

Can we sell them directly through Disney?

Would that be considered a Re-Sale under the new resale terms? If sold thru Disney would Disney set the price per point?

I want to give him correct information about options, and will call MS, however I know there are very knowledgeable people on these boards and thought I could get some input today.

Thanks,
Betty Anne

Legally if it's a sale (no matter how you work it), it must go through ROFR with the real numbers attached. You could add them for a nominal fee and let them pay the dues and use the contract points but it'd then be a partnership, something I generally discourage even though I added my daughter to one or our contracts. To add them or change the deed, you need ROFR, a new deed recorded with the country and then get the paperwork back to Disney after it's recorded. They have a couple of forms along the way (one with the ROFR request) and one at the end. Just to let you know, it's illegal to put one price and actually charge another just like it's illegal to say there's no price when there really is one. Also, currently, a sale would mean the contract would be treated as a non qualified resale I would assume.

 

[CarolAnnC]

Member Administration has assurred DVC members that ownership transfers to family members will retain the same benefits that the original purchase had. ROFR is required, but it is a formality and will not be exercised by them in this scenario, either.

I will be doing this eventually with my two DD's as well. Good luck!

 

[Dean]

Member Administration has assurred DVC members that ownership transfers to family members will retain the same benefits that the original purchase had. ROFR is required, but it is a formality and will not be exercised by them in this scenario, either.

I will be doing this eventually with my two DD's as well. Good luck!

We'll see. I think you'll see that transfer for free yes, sale no.

 

[lizanne]

Thanks for the replys.

Dean, I can assure you I have no intention of doing anything illegal. I just really didn't know how this works and was asking questions.

 

[DVCconvert]

but "price" and "payment" maybe two different things.
If you passed rofr and wrote the mortgage, you could even gift a % of the mortgage debt to the child per anum (currently 13K limit federally).
Just a thought and you'd want to run any such structure by your financial planner/tax attorney.

 

[JWG]

Member Administration has assurred DVC members that ownership transfers to family members will retain the same benefits that the original purchase had. ROFR is required, but it is a formality and will not be exercised by them in this scenario, either.

I will be doing this eventually with my two DD's as well. Good luck!

We'll see. I think you'll see that transfer for free yes, sale no.

You'll (if you want to protect your member benefits as direct purchase) need to do this as a gratuitous transfer. If there's a "purchase" it will be considered resale. I'd gift it to them.

 

[Dean]

Dean, I can assure you I have no intention of doing anything illegal. I just really didn't know how this works and was asking questions.

I just wanted to make sure that you knew there were concerns for some of the options that you might consider, many don't know these are issues.

but "price" and "payment" maybe two different things.
If you passed rofr and wrote the mortgage, you could even gift a % of the mortgage debt to the child per anum (currently 13K limit federally).
Just a thought and you'd want to run any such structure by your financial planner/tax attorney.

Technically, if it were done to get around ROFR or others, it wouldn't matter. I realize that it happens and most don't get caught, that there can be hairs to split at times and that it's unlikely that DVC would turn you in.

You'll (if you want to protect your member benefits as direct purchase) need to do this as a gratuitous transfer. If there's a "purchase" it will be considered resale. I'd gift it to them.

Or, as I stated earlier, add their names to the ownership then it could pass to them in the future.

 

[WildernessMickey]

My parents gave me their points last year as a gift since my father does not want to travel anymore. They just had the title transferred to my name and I did not pay them any money. There was an administrative fee to change the title, but my parents paid it so I don't know how much it was. We all filled out paper work and it went very smoothly. It officially goes through ROFR but only as a formality since there is no $ changing hands. Now the contract is in my name just as if I was the original owner. It was a really great gift and Disney made the whole process very easy to accomplish.

 

[lizanne]

I understand what all of you are saying.

We would have to sell the points. I have 5 children (adults), all of whom love WDW. We bought these points back in '92 and have certainly got our monies worth out of them. That's not the issue. I just couldn't "gift" them to one.

I'm not sure what we'll do. Maybe we should divide the points between them and then if they want to add on that would be up to them.

 

[DVCconvert]

I just couldn't "gift" them to one.

I wonder about a trust holding all the points for the benefit of all the kids.