Slow closing for resales - on purpose?

[disneynutz]

Right, but the prudent buyer would know the closing/access timeline before they buy.

How sensible is it to use 300 banked points as a significant factor in your purchase decision unless you will have certain access to them WAY in advance of expiration? Don't forget, just getting the points is not the only consideration. You have to get them in time for there to be reasonable availability for you to make reservations.

If I buy a contract and then "lose" $3,900 because the closing took too long, that's a self-inflicted wound.

Most buyers, my family included suffer from pixie dust blindness and must meet the mouse eagerness anxiety. Doesn't seem to mater if it's a resale purchase or direct buy.

Bill

 

[DVC Doctor]

I'm not fond of straw man arguments. You're presumption that there is any correlation is preposterous.

I'm not a fan of straw man arguments (or as the Brits would say, Aunt Sally) either - but the (non-preposterous) correlation is: Disney adds more workers when there is more people at the parks and now that there are more resales (this is a presumption) and the entire process of evaluating ROFR, setting up a new account online, and then loading points into a resale account is now taking significantly more time than in the past (this is not a presumption), then Disney should increase the number of workers in that department to handle the increases load UNLESS they are delaying the entire process on purpose to give an edge to developer sales of DVC memberships.

Right, but the prudent buyer would know the closing/access timeline before they buy.

How sensible is it to use 300 banked points as a significant factor in your purchase decision unless you will have certain access to them WAY in advance of expiration? Don't forget, just getting the points is not the only consideration. You have to get them in time for there to be reasonable availability for you to make reservations.

If I buy a contract and then "lose" $3,900 because the closing took too long, that's a self-inflicted wound.

I obviously agree with your above statement, but you stated earlier, that, "The focus on days and weeks is really kind of silly" and I obviously disagree with that statement - but you said above that "the prudent buyer will know the timeline" and UNFORTUNATELY it appears that timeline is LONGER now than in the past, so this is pretty new information on the resale process as in the past Disney was pretty quick and now it appears that they are slowing down and we all are speculating why.

 

[supersnoop]

I'm not a fan of straw man arguments (or as the Brits would say, Aunt Sally) either - but the (non-preposterous) correlation is: Disney adds more workers when there is more people at the parks and now that there are more resales (this is a presumption) and the entire process of evaluating ROFR, setting up a new account online, and then loading points into a resale account is now taking significantly more time than in the past (this is not a presumption), then Disney should increase the number of workers in that department to handle the increases load UNLESS they are delaying the entire process on purpose to give an edge to developer sales of DVC memberships.

That's still a non-sequitur argument. When the parks are busier, Disney is getting more revenue. More people = more money. More resales does not equal more money.

 

[JimMIA]

...but you said above that "the prudent buyer will know the timeline" and UNFORTUNATELY it appears that timeline is LONGER now than in the past, so this is pretty new information on the resale process as in the past Disney was pretty quick and now it appears that they are slowing down and we all are speculating why.

I don't think I explained myself very well.

My point is that closing completed and points accessible three months prior to expiration is not much different from three days. There is not likely to be much availability three months out -- and the availability only matters IF your work/family schedule would permit travel during that period. Both availability and scheduling would have to align perfectly for the points to be usable for anything other than dumping them into RCI.

So, to me, a prudent buyer would not place much importance on points that are going to be past their banking deadline and approaching expiration. To me, that's a prospective buyer who didn't research the system nearly enough.

If they'd done their homework, they would have had the seller bank the points so they could get some use out of them.

 

[disneynutz]

Since new sales adds to the amount of dues being paid and collected, one would think that the money would be more than enough to pay for MS and MS administration.

Resales are taking longer to process, website issues, email response time from MS is now 5 business days, Member Satisfaction now takes 7 business days. We are talking millions of dollars, where is it all going?

Bill

 

[DVC Doctor]

That's still a non-sequitur argument. When the parks are busier, Disney is getting more revenue. More people = more money. More resales does not equal more money.

You sound like an old college professor of mine, so I guess we will have to agree that we disagree. My opinion is - just because the parks are busier - that in turn does not mean more revenue for Disney as perhaps it is the summer and lots of locals with yearly passes from Orlando are coming into the parks with bag lunches and water bottles and spending all day in the park and NOT spending any money at all. Thus, the extra crowds means Disney will have to have extra staff for crowd control, clean-up, and to help manage the lines in the rides (or move more baby strollers around). The same analogy applies to resale contracts, more resales means more work and I am sure Disney builds in the cost of processing those resale applications no matter if they are slow or busy. Of course, for many years they could easily handle the volume and now they can't (or at least they are being artificially throttled back) and no matter what you say, Disney probably does make money (or at least it is breakeven) processing resales. The only issue is that resales have grown beyond their present capacity and they need more staff to process the extra work. If you argument was correct and Disney did not make (or break even) any money off resales, then they could, in theory take 1 year to process the resale applications instead of the current 3 months and the mega fast 45 days they used to take.

I don't think I explained myself very well.

My point is that closing completed and points accessible three months prior to expiration is not much different from three days. There is not likely to be much availability three months out -- and the availability only matters IF your work/family schedule would permit travel during that period. Both availability and scheduling would have to align perfectly for the points to be usable for anything other than dumping them into RCI.

So, to me, a prudent buyer would not place much importance on points that are going to be past their banking deadline and approaching expiration. To me, that's a prospective buyer who didn't research the system nearly enough.

If they'd done their homework, they would have had the seller bank the points so they could get some use out of them.

There are usually TONS of SSR and OKW and AKL rooms available within three months availability. In fact, I just booked July 23 so I can go to the members night at Typhoon lagoon and that is only 3 weeks from today and there are still great options available at four resorts. Now if you live in Texas, perhaps that would be a problem, but if you are withing a 5 hour drive of ANY of the DVC resorts you can often find a way to burn banked points.

Since new sales adds to the amount of dues being paid and collected, one would think that the money would be more than enough to pay for MS and MS administration.

Resales are taking longer to process, website issues, email response time from MS is now 5 business days, Member Satisfaction now takes 7 business days. We are talking millions of dollars, where is it all going?

Bill

We are speaking the same language and I am glad one person sees the same issue as I am trying to point out here.

 

[DenLo]

I don't think I explained myself very well.

My point is that closing completed and points accessible three months prior to expiration is not much different from three days. There is not likely to be much availability three months out -- and the availability only matters IF your work/family schedule would permit travel during that period. Both availability and scheduling would have to align perfectly for the points to be usable for anything other than dumping them into RCI.

So, to me, a prudent buyer would not place much importance on points that are going to be past their banking deadline and approaching expiration. To me, that's a prospective buyer who didn't research the system nearly enough.

If they'd done their homework, they would have had the seller bank the points so they could get some use out of them.

But if the difference were making or not making the 11 or 7 month marks, how would that fit into your scenario? I know what you are saying that is over the life of the contract, but we are human and what matters to us is our current vacation, not hypothetical vacations of the future.

I think it is ridiculous that DVD is having this slow down in the processing of anything related to resale purchases. Do they still process direct purchase timely? Or are there big delays there as well? Our dues do pay for some of the CM's salaries and DVD the builder and seller of the contracts pays others. Our dues only cover DVC employees but not the employees that are employed by the developer (DVD). However, the CM's are directed by supervisors and they are accountable to them. The higher ups are accountable to us. It is those employees who should be responsible for the poor performance.

 

[disneynutz]

But if the difference were making or not making the 11 or 7 month marks, how would that fit into your scenario? I know what you are saying that is over the life of the contract, but we are human and what matters to us is our current vacation, not hypothetical vacations of the future.

I think it is ridiculous that DVD is having this slow down in the processing of anything related to resale purchases. Do they still process direct purchase timely? Or are there big delays there as well? Our dues do pay for some of the CM's salaries and DVD the builder and seller of the contracts pays others. Our dues only cover DVC employees but not the employees that are employed by the developer (DVD). However, the CM's are directed by supervisors and they are accountable to them. The higher ups are accountable to us. It is those employees who should be responsible for the poor performance.

I agree but I often wonder how they keep the DVD employees work units separate from the DVC employees. I expect that the accounting system and accountability is not as exact as we would expect.

Maybe Wil would be so kind as to publish the monies being paid by owners for the various budget items totaled by resort. Members don't seem to notice how much is paid because each is only paying a small percentage but combined and compared by resort I think that we will be surprised by how much money DVC is being paid.

Bill

 

[supersnoop]

My opinion is - just because the parks are busier - that in turn does not mean more revenue for Disney as perhaps it is the summer and lots of locals with yearly passes from Orlando are coming into the parks with bag lunches and water bottles and spending all day in the park and NOT spending any money at all.

You're making a huge assumption without much basis. The parks are busier in the summer when people travel to them, not at times when only locals visit.

and no matter what you say, Disney probably does make money (or at least it is breakeven) processing resales

Disney makes $50 for processing the estoppel. Where else do you think they make money in this process?

I agree but I often wonder how they keep the DVD employees work units separate from the DVC employees. I expect that the accounting system and accountability is not as exact as we would expect.

My understanding is that DVD employs their own team to process all the paperwork and create the membership in the system. In the very least, they pay DVCMC for the privileged.

Maybe Wil would be so kind as to publish the monies being paid by owners for the various budget items totaled by resort. Members don't seem to notice how much is paid because each is only paying a small percentage but combined and compared by resort I think that we will be surprised by how much money DVC is being paid.

I'm not sure why it varies by resort, but owners pay about 37¢ per point as a "management fee." That's about $75/year for an average 200 point contract. A call center's average cost for each phone call is about $25. Add in the website, and I think we're getting our money's worth. Of course, that cost is why it frustrates me when I see folks calling three times a day for a week to get their member number.

 

[JimMIA]

But if the difference were making or not making the 11 or 7 month marks, how would that fit into your scenario? I know what you are saying that is over the life of the contract, but we are human and what matters to us is our current vacation, not hypothetical vacations of the future.

Doesn't make any difference to me. I consider the real value of any timeshare to be the vacations you can take over a period of years. I'm not concerned with one year. Ymmv.

 

[crisi]

Since new sales adds to the amount of dues being paid and collected, one would think that the money would be more than enough to pay for MS and MS administration.

Resales are taking longer to process, website issues, email response time from MS is now 5 business days, Member Satisfaction now takes 7 business days. We are talking millions of dollars, where is it all going?

Bill

These aren't new sales, they are resales. Net income to Disney on a resale is zero. The old owner paid the dues in the past, the new owner pays the dues in the future.

Its possible they could charge the new owner a service fee that would pay for temporary help in getting the contracts in when the market is busy. They almost certainly don't want Disney employees since the pace of sales is variable and they'll have to lay them off when sales slow down. Laying off employees costs Disney money.

And I expect their divisional accounting for payroll is very exact for member accounting and member services. That's easy accounting - and easy accounting with a regulatory requirement and state auditors looking at it. Accountants take that sort of thing very seriously. The hard accounting is dividing up the shared CMs - like the CMs who work the front desk at the shared resorts.

 

[disneynutz]

These aren't new sales, they are resales. Net income to Disney on a resale is zero. The old owner paid the dues in the past, the new owner pays the dues in the future.

Its possible they could charge the new owner a service fee that would pay for temporary help in getting the contracts in when the market is busy. They almost certainly don't want Disney employees since the pace of sales is variable and they'll have to lay them off when sales slow down. Laying off employees costs Disney money.

And I expect their divisional accounting for payroll is very exact for member accounting and member services. That's easy accounting - and easy accounting with a regulatory requirement and state auditors looking at it. Accountants take that sort of thing very seriously. The hard accounting is dividing up the shared CMs - like the CMs who work the front desk at the shared resorts.

I understand that Disney only charges a $50 estoppel fee for 5 minutes work on resales but I was trying to point out that the money that they collect for dues should be more than enough to process resales in a timely fashion. Plus since they set the budget to cover all costs, they could easily add what's necessary to do the job correctly, better website, shorter resale timeline, cleaner room, better rehabs.

Yes I know that this would cause dues to maybe increase but by how much?

Bill

 

[crisi]

I understand that Disney only charges a $50 estoppel fee for 5 minutes work on resales but I was trying to point out that the money that they collect for dues should be more than enough to process resales in a timely fashion. Plus since they set the budget to cover all costs, they could easily add what's necessary to do the job correctly, better website, shorter resale timeline, cleaner room, better rehabs.

Yes I know that this would cause dues to maybe increase but by how much?

Bill

And to whose benefit. Not mine, or the majority of owners since we own already and aren't doing resales. I'd like to see dues go for things where everyone can get equal access to the benefits given. Regardless of if its a small increase or not, bad precedence. Resales - charge a filing fee if they need to add staff.

It took us almost three months from offer to member number almost fifteen years ago. Thirty days for Disney to decide on ROFR. Another four or five weeks for the closing company, then it was another three before our member number arrived in the mail.

If I'd like to see Disney do anything, I'd like to see a process improvement in systems. It used to be that you could call and get your member number - but apparently between security concerns and workload that has all but stopped. So we know its there earlier than the mailing, the mailing has always been the delay. It isn't a huge systems change for the system to query for those accounts every night that have been processed into the system and email the member a welcome home note with the member number. It isn't even a huge deal for them to send you an email to confirm your identity (just in case your email address is wrong) then send you your member number once you confirm with the last four digits of your SSN and the number or points at which resort.

 

[abbysmama]

We just closed on a resale. It was a cash transaction. I put in an offer on 3/17/15 and received my membership number on 6/8/15. Not quite three months, but it certainly took longer than I had originally anticipated.

I also am a cash sale and it is over 90 days and we haven't even closed yet.

 

[WDWGeek1971]

Resales are taking longer to process, website issues, email response time from MS is now 5 business days, Member Satisfaction now takes 7 business days. We are talking millions of dollars, where is it all going?

Bill

This is a really good reason to make sure you have some funds invested in Disney stock, before you "invest" in DVC.

 

[Minniesgal]

But if the difference were making or not making the 11 or 7 month marks, how would that fit into your scenario? I know what you are saying that is over the life of the contract, but we are human and what matters to us is our current vacation, not hypothetical vacations of the future.

I think it is ridiculous that DVD is having this slow down in the processing of anything related to resale purchases. Do they still process direct purchase timely? Or are there big delays there as well? Our dues do pay for some of the CM's salaries and DVD the builder and seller of the contracts pays others. Our dues only cover DVC employees but not the employees that are employed by the developer (DVD). However, the CM's are directed by supervisors and they are accountable to them. The higher ups are accountable to us. It is those employees who should be responsible for the poor performance.

Took them 4 weeks to sort out my 40 VGF point add on that happened to time with the launch of the Poly. Even my guide said it was ridiculous.

 

[bakerworld]

IMO, when buying resale you have to figure that the sale time will be extended from participants not returning documentation to various companies allowing documents to mount up on their desk (after all, a messy desk is an employee hard at work with too much work to accomplish easily in one day, right? Equals job security). I don't see the problem.

 

[ColinBlair]

The truth is that buyers have absolutely no power in the resale market and should expect to be treated awfully at every step along the way. The brokers really are working for the seller and are trying to get the highest commission they can and then have nothing to do with the rest of the process. The closing agent will give you a contract with an imaginary closing date they will change on a whim whenever they feel like it without every actually notifying you so that they can hold onto your money as long as they can. Disney will drag their feet as much as they can to lengthen the process out because they would rather you bought direct. And finally, chances are the sellers don't really need the money and so will show absolutely no urgency in completing their paperwork. It isn't like there is a real closing date they need to submit by.

My impression is that the entire DVC resale industry is rotten, but due to government regulation in the end is completely safe and the result is a cheaper way of buying DVC. Kind of like dining out at Dick's Last Resort or Ed Debevic's.

 

[abbysmama]

I also am a cash sale and it is over 90 days and we haven't even closed yet.

Same here, just closed yesterday at 97 days. Figure another 4-5 weeks to get info from DVC.

 

[Disneyhappy]

I suspect 90 days is more like the industry standard, or even a little better. I know when we purchased Wyndham, the transfer took almost 6 months and that's not an unusual timeline, especially if there are any issues with the documentation. Most of the paperwork is done via snail mail and it just takes a long time.

Our resale took over 90 days earlier this year. What I found ironic is that we we able to close on our home with a several hundred thousand dollar loan in 45 days. I agree with PP that I expect Disney to be the exception and not the rule.