Should I take my dad's offer ?

[Miffy]

Though I would love to keep them all in my family, I think that the reality is that I will probably keep the 200 points that my dad is going to gift me, gift my siblings some money to cover the other 30 points that I want to keep and let dad sell the rest.

OP: Yes, this is the best solution and the simplest. As for the "commission," think of it this way: you're going to do the work of selling the points, but you're also actually getting the biggest benefit from these points, since you'll use them and enjoy them for many years. Yes, your siblings will get cash, but to those of us who love Disney, those 230 points you're getting sound pretty darn wonderful. So skip the idea of charging your siblings. They're clearly not interested in the points and it's best to keep everything as simple as possible. If your siblings would suggest that you should get some greater benefit, that's different and it would be up to them.

 

[davidl81]

I would try to keep the 600 points depending on what cost you come up with on the extra 370 points. You can fairly easily rent for $15 per point right now, so that gives you a profit of about $8-9 per point. So at $8 per point profit that would be about $3000 per year of profit. Lets say that you value the 370 points at $100 per point, then your upfront cost would be $37000, and you would generate about a 8% return by renting the points. Of course like anything you may not be able to rent the points for $15 every year, but I highly doubt you would ever get less than $10 a point.

As far as splitting cost with family I would think it would be worth a call to a broker to get a fair value on the value of the points. That way you have a 3rd party with inpit.

 

[Frederic Civish]

Because we wanted my siblings to have DVC member benefits and right of survivorship, we setup that contract with all of our names on it. 4 siblings and my dad (you can have up to 5 names on the deed). My dad and I paid the MF fees. We used the timeshares, but we also brought our family along.

I don't know if Disney will only put 5 names on the Deed, but I have several deeds that i purchased at Resale, where I have 6 names on the deed. I am thinking of establishing a Family Trust and just move everything into that, but I don't quite know how to go about doing that.

 

[BroganMc]

I don't know if Disney will only put 5 names on the Deed, but I have several deeds that i purchased at Resale, where I have 6 names on the deed. I am thinking of establishing a Family Trust and just move everything into that, but I don't quite know how to go about doing that.

They may have broadened it since we purchased back in 2006.

I have to retitle some of our add-on contracts because my dad and I set them up as tenants in common instead of joint tenants. I'm working with a probate lawyer so I still know more about it when I'm done. My intention is to remove my dad and as his trust in his place. I'm willing my contracts to the trust as well. We'll continue to use them as always. A family travel agent books vacations based on the various requests. MFs paid by the Trust. We use the time to vacation together and grow the family bonds.

I'm guild when you are moving contracts around within the family., Disney is understanding

 

[Dean]

I have a dilemma and would appreciate some opinions. My parents bought into DVC about 10 years ago, adding points until they have 600 points now. 480 points are at SSR split between three contracts of 110, 170, and 200 points. 120 points are at BLT in two contracts of 30 and 90. They did this with the expectation that my two siblings and I would eventually each get 200 points apiece.

The time has come where my dad is ready to stop paying the maintenance fees and pass the points on. My family is the only one that is really into Disney, so my two siblings want to sell their points. I want to keep mine. I plan to keep the BLT points and probably the SSR 110 point contract, so we would sell the SSR 170 and 200 point contracts. I would give my siblings the equivalent after-commission cost of the other 30 points.

My dilemma is that my father has offered to "gift" me the other points and I would in turn "gift" my brother and sister with some cash. It's a decent price, somewhat lower than what contracts are selling for right now. I have the money to buy them if I want to do it though it would come out of the stock market.

My heart says to buy them, but my head isn't so sure. Realistically we really don't need that many points. I think that the 230 points would be plenty for how we would typically use them, so I would probably rent the majority out to pay for the MFs. We don't typically book more than 7 months ahead so I could rent out the BLT points for more and some of the SSR too.

So which way do I go? How easy is it to rent them? I know that renting them should cover the MFs but there is a pretty big expense up front to buy them. If I buy them I would see it as somewhat of an investment. Is this a good investment or not?

Any thoughts or advice would be appreciated. Thanks!

I realize this is a couple of months old but I haven't been around much and there are some points that I didn't see scanning through the thread. First, if they're going to gift it you should be find but you said "gift" and your wording suggested they were going to sell it to you at a deal part gift and part cash. In this situation it's a sale at a reduced price and not a gift legally and to DVC. To put one set of terms on the contract and have a side deal is illegal in FL and all states I know of. If they truly gift it, be careful of gift tax rules, you may want to break it down and do it over 3 years to avoid that issue.

That said, if you are financially in a state where the dues will not put a strain on you, I'd likely take the entire set and rent any unused points. You can always sell later if you want once you decide how you'll use it but cherry picking and keeping a portion is not a bad plan as well. I do agree with the risk of family taking advantage so I WOULD have that conversation before you proceed. You may find you need more (or less) later.

 

[drusba]

Thank you everyone for your comments. They were all helpful in helping to decide what to do. I think that I wanted to be convinced that the best thing to do was to keep all of the points. Though I would love to keep them all in my family, I think that the reality is that I will probably keep the 200 points that my dad is going to gift me, gift my siblings some money to cover the other 30 points that I want to keep and let dad sell the rest. It would be a lot of fun to keep them all but that would be a significant outlay of cash right now plus the extra $$ each year for MFs. As I think about how we travel to Disney, I think that 230 points is enough. Although I do love to vacation at Disney, I also love to vacation other places too so I think that I will use that cash to do other traveling.

As for the rest of my family, my sister's kids are already in college or beyond and have shown little interest up to now in traveling to Disney so I doubt that will change. Her family really hasn't gotten as much use from the points as I have so I am not surprised that she wants to sell. My brother's kids are a little younger and have used them a little more. I wasn't sure what he would want to do but I'm not really surprised that he's ready to sell too. If they want to use them in the future, then I plan to rent them for what they cost me for the year, if I'm not using them myself. That way we both win.

These points were bought direct from Disney, so as long as my dad gifts them to me, I can keep all the perks.

I have one more question that I would appreciate opinions on. For all the years that we have had the points, I've been in charge of taking care of them. My parents have always paid the MFs by automatic payments, but I'm the one who has always monitored use and banked them when we had some left. When we have all gone on family trips together, I have been the one to make all the arrangements, usually spending a decent amount of time on the phone with member services to get everything taken care of. I'm also the one who is now supposed to take care of arranging the sale of the points. Would it be reasonable for me to charge a "commission" to my siblings for the time that I have spent on all this? I had thought that perhaps the extra amount that the BLT points are worth could be my commission (20% of our points are BLT, the rest are SSR). Is that reasonable or is that too much? Or should I just forget about that? My siblings probably have no idea that the BLT points are worth more but I want to be fair, and avoid any potential conflict in the future.

Thanks again for your input! I knew that this would be a good place to ask this!

Expanding on Dean's comment: there is an issue that needs to be considered before you proceed. Disney has a Right of First Refusal for all sales, but not gifts. And that includes sales between relatives. If in the scheme of transactions, there is anything that looks like a sale, DVD must be given the right to purchase at the same price that is being offered. And you cannot circumvent that right by having one party gift to another points who then pays, via an alleged cash gift, the transferor or someone else for all or part of the points. In other words, if for example, you take the points as an alleged gift and then "give" your siblings money that covers what they may have gotten, and DVD learns what was done, it could sue based on the violation of its Right of First Refusal. It could even allege the activity amounts to fraud in an attempt to avoid ROFR and include a claim that the activity is also a wrongful attempt to avoid having the resale restrictions that would apply to a sale. In other words, think carefully before proceeding. And do not even start to consider adding charges for services previously rendered as a reduction to what will be paid to siblings because that would be just further proof that there is no "gift" for those 30 points.

 

[OrangeCountyCommuter]

I have one more question that I would appreciate opinions on. For all the years that we have had the points, I've been in charge of taking care of them. My parents have always paid the MFs by automatic payments, but I'm the one who has always monitored use and banked them when we had some left. When we have all gone on family trips together, I have been the one to make all the arrangements, usually spending a decent amount of time on the phone with member services to get everything taken care of. I'm also the one who is now supposed to take care of arranging the sale of the points. Would it be reasonable for me to charge a "commission" to my siblings for the time that I have spent on all this? I had thought that perhaps the extra amount that the BLT points are worth could be my commission (20% of our points are BLT, the rest are SSR). Is that reasonable or is that too much? Or should I just forget about that? My siblings probably have no idea that the BLT points are worth more but I want to be fair, and avoid any potential conflict in the future.

Thanks again for your input! I knew that this would be a good place to ask this!

My mouth is literally hanging open. .

You did this for years for free but now "oh wait it's worth extra in the inheritance"

I hope your parents have a DETAILED will to deal with the rest of their estate because based on this paragraph I foresee a lot of potential conflict in the future!

 

[BroganMc]

My mouth is literally hanging open. .

You did this for years for free but now "oh wait it's worth extra in the inheritance"

I hope your parents have a DETAILED will to deal with the rest of their estate because based on this paragraph I foresee a lot of potential conflict in the future!

I don't think OP was trying to be nefarious, just hopeful they could be justified in asking for the more valuable BLT points. OP did state the other siblings saw the DVC investment as something to be converted to cash and not really valuable as a vacation experience. That would be more worrisome to me since it shows a viewpoint of something the parents have accrued and left behind in the name of nurturing family togetherness as something to be valued only for its monetary value.

I've acted as Family Travel Agent for my family the last 19 years. I purchased timeshare investments with my father which we used ourselves and with our family. I maintain a huge balance of hotel points so I can get my siblings stays (I almost never use them for myself). My dad and I covered all the MFs and credit card expenses. Now that he's gone (passed away last year), I continue to manage all that he left behind. And I've added to the portfolio with resales so I can have more flexibility with stays. My siblings have a rough idea of how much it costs and the time involved, but none of them ever do the work. They just state their preferences and I make it happen. Technically I do own the majority of the timeshare interest (since I was buying with my dad 15 of the last 19 years), but I value it the same as he did: as a way for the family to spend quality time together. All my trips include an open door policy inviting any family member to join me. I'll book when I know it's more likely they can come. (I just stayed 3 weeks in Orlando and had a rolling cast of family joining me along the way as they had Spring Break.) I book a group trip every summer. And I honor what my dad wanted and give them solo time for just their families. Fortunately, none of them see this tremendous gift of vacations as a purely monetary thing. They value it just like my parents did and I do.

It's hard enough when you lose your parents. No need to throw in petty monetary jealousies. No amount of money is worth damaging your family relationships.

 

[kniquy]

and DVD learns what was done, it could sue based on the violation of its Right of First Refusal. It could even allege the activity amounts to fraud in an attempt to avoid ROFR and include a claim that the activity is also a wrongful attempt to avoid having the resale restrictions that would apply to a sale. In other words, think carefully before proceeding.

Do they typically send out DVC investigators after a gifted transaction?

This is what the OP stated:

My dilemma is that my father has offered to "gift" me the other points

I would give my siblings the equivalent after-commission cost of the other 30 points.

She is indeed being gifted the contracts from her father. What ever dealings she has to have between her siblings is hardly paying for the contracts and if instead of her paying the siblings any cash for those 30 points she could let them each use some points for a trip down the road -- with no money being exchanged. Her father too could decide that the other siblings aren't owed a dime and for the time OP has spent managing the contracts he may feel she has earned those extra 30 points.

I guess there are numerous scenarios which would still make it a legitimate transactions without the fear of any backlash from DVC.

 

[Dean]

Do they typically send out DVC investigators after a gifted transaction?

This is what the OP stated:

She is indeed being gifted the contracts from her father. What ever dealings she has to have between her siblings is hardly paying for the contracts and if instead of her paying the siblings any cash for those 30 points she could let them each use some points for a trip down the road -- with no money being exchanged. Her father too could decide that the other siblings aren't owed a dime and for the time OP has spent managing the contracts he may feel she has earned those extra 30 points.

I guess there are numerous scenarios which would still make it a legitimate transactions without the fear of any backlash from DVC.

No they aren't going to send the FBI. But as I read the OP, it didn't sound like it was truly a gift but part gift and part sale. But it's also a violation of state law to put one set of terms that are different than the actual deal. If it's not truly and completely a gift they might break it out as a gift and a sale separately for different contracts.

 

[bumbershoot]

She is indeed being gifted the contracts from her father.

It’s different than what you quoted. From the original post.

my father has offered to "gift" me the other points

and I would in turn "gift" my brother and sister with some cash.

Quotation marks change the meaning.

If they truly gift it, be careful of gift tax rules, you may want to break it down and do it over 3 years to avoid that issue.

Well, the giver only has to worrry about paying taxes on gifts once they’ve gone over 11+ million dollars in giving in their lifetime. (Yes I’ve been looking into this lol). So while they would need to note anything over the 2019 amount to/from a person as a gift on taxes, they might not need to worry about *paying* a gift tax...

 

[Dean]

Well, the giver only has to worrry about paying taxes on gifts once they’ve gone over 11+ million dollars in giving in their lifetime. (Yes I’ve been looking into this lol). So while they would need to note anything over the 2019 amount to/from a person as a gift on taxes, they might not need to worry about *paying* a gift tax...

Current rules assuming they complete the IRS form to borrow the exclusion.

 

[Lumpy1106]

Here's the problem I see; the OP wants to keep ALL of the BLT and 110 of the SSR, but that is far more than 1/3 of the value of the contracts. total (resale) value is;
BLT = 145/pt * 120 = 17,400
SSR = 100/pt * 480 = 48,000
Total = 65,400 / 3 = 21,800 ($109/pt)
But OP wants to keep 17,400 + 11,000 = 28,400 ($123.48/pt) - that's not right, and I would guess her siblings have discovered this too.
Solution;
Virtually sell everything, split it 3 ways, then OP "buys" what she wants. IOW, OP puts 28,400-21,800 = $6600 back into the pot. Just cut a check for $3300 to each sibling. The tricky part is closing costs. Since each of her siblings is now going to sell 21,800+3300 = 25,100, they should pay 25,100/65400= 38% of the closing costs, while OP should only pay 21,800-6600=15,200/65,400 = 23% of closing costs.
That's fair, do it now while everyone is of sound mind and be done with it...

Then charge going rate in rent if the siblings decide to join OP on future trips

EDIT;
Thought about this overnight - OP isn't selling anything so she pays no closing costs. In fact, she is saving her siblings closing costs for the $6600 worth of contracts she is keeping above what the original 1/3 gift was. Just cut the $3300 check to each sibling, get title transferred to OP's name and leave the rest to the siblings to decide what to do.

 

[Lumpy1106]

Expanding on Dean's comment: there is an issue that needs to be considered before you proceed. Disney has a Right of First Refusal for all sales, but not gifts. And that includes sales between relatives. If in the scheme of transactions, there is anything that looks like a sale, DVD must be given the right to purchase at the same price that is being offered. And you cannot circumvent that right by having one party gift to another points who then pays, via an alleged cash gift, the transferor or someone else for all or part of the points. In other words, if for example, you take the points as an alleged gift and then "give" your siblings money that covers what they may have gotten, and DVD learns what was done, it could sue based on the violation of its Right of First Refusal. It could even allege the activity amounts to fraud in an attempt to avoid ROFR and include a claim that the activity is also a wrongful attempt to avoid having the resale restrictions that would apply to a sale. In other words, think carefully before proceeding. And do not even start to consider adding charges for services previously rendered as a reduction to what will be paid to siblings because that would be just further proof that there is no "gift" for those 30 points.

Not an attorney, but that sounds overly complicated. OP's name can be added to / changed on the deed of whatever she wants to keep without ROFR. Disney needs only be concerned about what is really sold. The contracts to be sold just need to stay in the parents' name through the sale so the process isn't muddled (like it would be with a contentions divorce for example).

 

[RamblinWreck]

I would try to keep the 600 points depending on what cost you come up with on the extra 370 points. You can fairly easily rent for $15 per point right now, so that gives you a profit of about $8-9 per point. So at $8 per point profit that would be about $3000 per year of profit. Lets say that you value the 370 points at $100 per point, then your upfront cost would be $37000, and you would generate about a 8% return by renting the points. Of course like anything you may not be able to rent the points for $15 every year, but I highly doubt you would ever get less than $10 a point.

As far as splitting cost with family I would think it would be worth a call to a broker to get a fair value on the value of the points. That way you have a 3rd party with inpit.

The 8% return is a little bit deceiving, since the principal will also disappear over time.