The "I financed DVC and am glad I did" club

[jodifla]

So hebbynan - here is the question - how are you going to pay for the things that inevitably come up if you have a DVC payment to make? If you can do both - then financing might not be perfect, but it might not be horrible. If suddenly the car needs $2000 worth of work and the furnace needs to be replaced - can you do that AND make the DVC payments? That's the risk.

Those things that inevitably come up - they'll come up when you have a DVC payment as well. Only now you have a DVC payment - and that means that its much harder to pull your trip back (stay offsite, go for fewer days) to pay for the furnace because "we have the points."

Why would you assume automatically hebbyman can't do both?

Edited to add: When I see that someone is financing, I assume financial competence on their part. That they've done their homework, crunched the numbers and scenarios and that it's a reasonable risk to them. I also think ease of use varies greatly by where you live: Living in Florida, you buy a Florida seasonal pass, you drive your car up, you pack your own food -- it can be very inexpensive vacation.

 

[thebigman65]

I don't think Crisi was assuming anything.....just asking the question and posing a point.....from our standpoint, financing made sense, because we would never have the entire cash down to do it and we wanted to enjoy ourselves and our kids on Disney vacations....now....not years from now....so the financial part made sense for us. We had some struggles last year and it became difficult, but we cut back in other areas and maintained DVC...one, because we love it and two, because we have invested in it and don't wish to give it up....ours will be paid off soon and we have no regrets.

I say if you want to pay cash, pay cash. If you want to finance and can manage the risk, finance.

But most of all, enjoy your life and don't always wait for the "perfect time" or you may miss thing all together....

To a certain point I believe the following quote by Hunter S Thompson:

"Life should not be a journey to the grave with the intention of arriving safely in a pretty and well preserved body, but rather to skid in broadside in a cloud of smoke, thoroughly used up, totally worn out, and loudly proclaiming "Wow! What a Ride!”

 

[jodifla]

I don't think Crisi was assuming anything.....just asking the question and posing a point.....from our standpoint, financing made sense, because we would never have the entire cash down to do it and we wanted to enjoy ourselves and our kids on Disney vacations....now....not years from now....so the financial part made sense for us. We had some struggles last year and it became difficult, but we cut back in other areas and maintained DVC...one, because we love it and two, because we have invested in it and don't wish to give it up....ours will be paid off soon and we have no regrets.

I say if you want to pay cash, pay cash. If you want to finance and can manage the risk, finance.

But most of all, enjoy your life and don't always wait for the "perfect time" or you may miss thing all together....

To a certain point I believe the following quote by Hunter S Thompson:

"Life should not be a journey to the grave with the intention of arriving safely in a pretty and well preserved body, but rather to skid in broadside in a cloud of smoke, thoroughly used up, totally worn out, and loudly proclaiming "Wow! What a Ride!”

Yes, I overall agree with this philosophy!

 

[disBOBney]

This thread says "I financed and I am glad I did." And then asked if others felt the same way? So for the nay sayers, you obviously didn't, and that is ok too. No one is suggesting that anyone who doesn't feel comfortable financing should bite the bullet and do so. I have purchased three contracts financed two of them and am very glad that my friends had talked me into buying DVC. Are there risks involved, of course. But that isn't because a person bought DVC of financed DVC it is because there are risks with living. At any time the sky could seem to fall, but generally doesn't.

After buying my first DVC contract I had a tight year, and because I had my contract I rented out part of my points, got through the tough spot and had a shorter vacation that year.

Having done that I decided perhaps I had more points than I needed, I sold the contract for more than I paid, including finance charges (and I had bought direct,) and I had already enjoyed 2 great vacations, then bought a smaller contract for cash. Since then add-on-itis had me buy a third contract because I enjoy taking others on vacation with me. And life is good.

Except for the possibility of Walt Disney World closing, which I am willing to bet will not happen in the next 10 years, it is very difficult for the financing of a DVC contract to be the cause of anyone's financial ruin, IMHO.

I personally recommend that if anyone is hoping to stay at WDW two times or more in the next 10 years to seriously consider a DVC purchase. If you can pay cash all the better.

 

[Sur]

All I'll say is I didn't finance but ever time I stay at DVC villas, emotions come over me like a child at Christmas. Nothing has come close to this kind of vacation elation.

 

[keishashadow]

We financed and are glad we did. It's been paid off for more than 13 years now; we've owned for 18 years. We just used the cash we were already spending on Disney to pay off the DVC over the course of the loan.

If we'd waited until we had all the cash in hand, it would have been like the couple in the movie "Up" who never got to go anywhere or do anything because some big expense always came up. Also, we bought in at a fraction of the cost the units go for now. If we'd waited, the price would have been skyrocketing up at the same time we were trying to save. Also, we didn't spend all that cash on hotel rooms -- we funneled into DVC payments.

Who else is glad they bucked the traditional wisdom and financed? (And a bit sick of the endless "if you have to finance a luxury, you can't afford it" threads?)

I always thought those who didn't finance were the odd ducks out here - quack!

We have utilized the cash method, starting small and adding on over the years both thru DVC & resale.

The tipping point for us to buy in was finding a first resale purchase that was 'loaded' & in the same ballpark money-wise as a week @ the Poly. I already had the cash set aside in that year's vacation budget, it was a no-brainer for me.

We had a full contract within a few years adding on direct to original contract and buying another small contract thru DVC. DH who was originally doubtful has become a Disney convert & even bought me AK for my birthday this year

What I find amazing is how people feel free to comment on other's financial decisions in the first place. Can't understand why anybody would give a hoot how another person funded their membership, let alone pass judgment on it.

 

[hebbynan]

So hebbynan - here is the question - how are you going to pay for the things that inevitably come up if you have a DVC payment to make? If you can do both - then financing might not be perfect, but it might not be horrible. If suddenly the car needs $2000 worth of work and the furnace needs to be replaced - can you do that AND make the DVC payments? That's the risk.

Those things that inevitably come up - they'll come up when you have a DVC payment as well. Only now you have a DVC payment - and that means that its much harder to pull your trip back (stay offsite, go for fewer days) to pay for the furnace because "we have the points."

Those things come up now - so why would it be any different?

This is why we are waiting probably 2 more years. We have money....I just don't want to use it on vacation club. I'd rather finance that (with a payment similar to a car payment each month - INCLUDING the monthly maintenance fees) and save the other $ for the things that come up. In the next 2 years we will be debt free except for our mortgage....hence why we've waited this long and will wait 2 more years. Our credit score is excellent - so financing isn't going to be a problem and we'd actually like to get a 3 year loan instead of the longer 5-6 year one. I'm not going into this naïve and with blinders on. We've been doing our homework.

 

[crisi]

Those things come up now - so why would it be any different?

This is why we are waiting probably 2 more years. We have money....I just don't want to use it on vacation club. I'd rather finance that (with a payment similar to a car payment each month - INCLUDING the monthly maintenance fees) and save the other $ for the things that come up. In the next 2 years we will be debt free except for our mortgage....hence why we've waited this long and will wait 2 more years. Our credit score is excellent - so financing isn't going to be a problem and we'd actually like to get a 3 year loan instead of the longer 5-6 year one. I'm not going into this naïve and with blinders on. We've been doing our homework.

Cool.

I figured. A surprising number of people really do believe that if they can afford payments, they can afford whatever it is - leaving no room at all for "need a new furnace." And that is where financing starts going from "less than optimal" to "risky" - add in someone with uncertain job prospects or an unstable marriage and you get straight to "dangerous." I'm glad to hear you aren't one of them.

It would, of course, be optimal if everyone were wealthy enough to just buy what they wanted when they wanted it (it would take some strange Star Trek technology and have huge economic impact, but in our fantasy world). That isn't the case, and which is why while I'm not a fan of financing (I'm very conservative financially myself), I don't think its always evil and say its "not optimal." But when you don't have blinders on and have evaluated the risks, sometimes not optimal is just fine.

Of course, you won't get many responses to a thread titled "I financed DVC and it was a disaster." Many of those people don't read this board any longer.

(I did finance my DVC - for about ten days with a home equity line of credit while my husband's bonus check came through.)

 

[hebbynan]

So true Crisi. Actually I can thank DVC as it's the reason we've been working so hard to pay off all of our other debt! We've wanted to be DVC owners for such a long time and we finally realized we need to get it together with our other debt before we can purchase. It's been a real eye opener for us and we've realized just how much we were purchasing that we didn't really need. We're about 2 years into what we figured would be a 4 year process....so half way there. When that last debt is paid off it will be a celebration because THEN we can look at buying resale and actually put in bids!

 

[eliza61]

Everybody has to assess their own financial situations to see if it makes sense. The problem is the blanket assertion that everyone who finances a timeshare is irresponsible and headed for financial disaster. That certainly hasn't been the case for us. We could sell our DVC now for what we paid for it, after almost 20 years of use, and we would then have just spend our dues on almost annual fabulous vacation stays.

That is a very dis mantra. and god forbid you dare to say that you went on vacation while having any type of debt besides mortgage. Mama Mia!! I've been told I am personally the reason why the country is in the financial mess it's in.
Yeah, me staying at the Poly on credit is exactly the reason.

I did 1/2 when we purchased our dvc. We put down half than put the remaining on a credit card. lol got a boat load of points too.

I've never understood the dis obsession with telling others how to manage their financial life especially since they are perfect strangers.
I just figure every one here are adults and should live their lives in the manner that they see best.

I'm retiring soon, I'll have a mortgage when I retire. I'm also toying with the idea of purchasing some points when/if the poly dvc goes on sale.

LOL, I can imagine what dave Ramsey would say. I have a compentant financial planner who knows of my DVC dreams so whether or not I'll finance remains to be seen but with the feds just announcing the interest rates will stay ridiculously low, I doubt I'll be pulling 20K out of my investments to pay for it. I may slap it on another 0% for a year credit card who knows
but I definitely won't have any issues with it if I do decide to finance.

 

[eliza61]

So hebbynan - here is the question - how are you going to pay for the things that inevitably come up if you have a DVC payment to make? If you can do both - then financing might not be perfect, but it might not be horrible. If suddenly the car needs $2000 worth of work and the furnace needs to be replaced - can you do that AND make the DVC payments? That's the risk.

Those things that inevitably come up - they'll come up when you have a DVC payment as well. Only now you have a DVC payment - and that means that its much harder to pull your trip back (stay offsite, go for fewer days) to pay for the furnace because "we have the points."

Hey Crisi,
not hebbynan, but here's my take.

You can use that scenario to justify never doing any thing as those things are always an issue.

I had to buy a new car this year, my old one was 25 years old. I got a luxury car, now I could have easily said, well get a used camary and pay cash for it because X might break, Y might happen.

I don't know if you remember I did have a year like that. The a/c unit broke, every major appliance went and we owed the IRS 8K. You know what we prioritized, decided what to finance and what to use the emergency fund for and then we planned our vacation to Disney.

life keeps happening.

Next year we plan on doing London. My company is undergoing major restructuring so will I have a job, will I not who knows. but I do know I can't "not" live because I maybe unemployed in 10 months (might be a good thing if they offer a package because I'm close to retirement). So I'm planning our trip, if I get laid off, I'll make a decision whether to go or not but as of right now, no way am I'm postponing cause some thing might come up.

I also think folks personal comfort level comes into play. some folks hate any type of debt at all, some people don't. some folks have a higher tolerance for risk in their investments, some don't.

I take a more "big" picture view. I'm more of the how can I increase my net worth as opposed to how can i be debt free.

 

[bumbershoot]

We just used the cash we were already spending on Disney to pay off the DVC over the course of the loan.

We were spending quite a bit going to Disneyland (and when I say that, I mean on hotels...we didn't lump transportation, dining, and tickets into it). We knew we wanted to try WDW soon. We knew we would be spending quite a bit there. DVC showed up, we thought about it for 1.5 years. We kept spending quite a bit going to Disneyland. Realized hey, that money could be going towards DVC. And so it did.

I've been told I am personally the reason why the country is in the financial mess it's in.
Yeah, me staying at the Poly on credit is exactly the reason.

It's all your fault!

We withstood the immense pressure from family and friends for about 5 years; they really really really wanted us to do what they were doing, and get a mortgage. We were told it was soooo easy to get a mortgage, we sholdn't worry, just get one! They got one, we should get one! Owning a home was sooo much better.

sidenote: as a renter, no one suddenly wants us to buy a furnace. It's lovely, renting from a terrific landlady. I have never had to buy an appliance. One breaks, it gets fixed or replaced in days. Awesome.

Anyway, the peer pressure was immense. Instead, we continued happily renting and we financed DVC.

And then the bottom fell out. From our friends and family. But not us. And because we financed and then had a crisis post-rescission-period, we smartened up in other ways and are stronger than we might ever have been. MIL/FIL/BIL/his partner lost their house (Long Beach CU held the mortgage, it was $10K owed and SIX MONTHS from first payment missed to auction of the house, back in '05), dad nearly lost his (augh) second house (that he never should have bought), a friend freaked for months about her balloon payment, etc etc etc.... Meanwhile, we continued along in our rental condo with our awesome landlady. Taking DVC vacations.

So...which one was the big scary risk?




I get that some people were born with awesome saving brains, or married into a family like that and learned it, or learned it at their parents' knees. That wasn't me and DH. My mom was too busy working 6 days a week to keep us eating and dressed. DH's dad was too busy telling his kids that his money wasn't their business (his monkey business, more like, as we found out after he died). Not everyone learns it or just knows it.

For people with brains that allow for savings to be easy, they don't get that to some other people, a savings account doesn't work well. Money has to be going TO something. A savings account isn't *something*. It's amorphous and just there. So it gets raided. And raided. And again. Whereas a *payment* is something. It has to happen, no getting around it. So you can weather a "eek I need a new transmission" storm even with a DVC payment, when you couldn't do both "saving for future DVC" and the transmission. The savings account for DVC would be raided.

Think of the couple in Up. Their travel fund is raided throughout their whole lives. They probably, at some point, should have done something different, and the whole story would be different. But they kept thinking "we have to save up", while never thinking "hey, how about TWO savings jars? one for travel and one for life-junk". The amorphous and vague savings account is harder on some people than having a payment and then the rest of their money.

Not sure I'm explaining myself. It was interesting, to explore why we thought we needed A Savings Account without any sort of plan on what it was for. Dave Ramsey helped us a great deal, in that post-DVC-financing, oh-no-DH's-job-is-on-the-chopping-block time. Changed quite a bit! Savings for something in the future is still very very hard for us, so we have to label things. This account is for X. That account is for Y. etc. And we never once thought of that sort of thing on our own! Just isn't in our nature.

 

[christianweecare]

We financed and are glad we did. It's been paid off for more than 13 years now; we've owned for 18 years. We just used the cash we were already spending on Disney to pay off the DVC over the course of the loan.

If we'd waited until we had all the cash in hand, it would have been like the couple in the movie "Up" who never got to go anywhere or do anything because some big expense always came up. Also, we bought in at a fraction of the cost the units go for now. If we'd waited, the price would have been skyrocketing up at the same time we were trying to save. Also, we didn't spend all that cash on hotel rooms -- we funneled into DVC payments.

Who else is glad they bucked the traditional wisdom and financed? (And a bit sick of the endless "if you have to finance a luxury, you can't afford it" threads?)

What a good way to look at it! DH & I have two homes resorts. We paid off our first home early and added a few points at another resort earlier this year. We plan to pay it off early, as well. We love our DVC!

 

[Serkazong]

Hey Crisi,
not hebbynan, but here's my take.

You can use that scenario to justify never doing any thing as those things are always an issue.

I had to buy a new car this year, my old one was 25 years old. I got a luxury car, now I could have easily said, well get a used camary and pay cash for it because X might break, Y might happen.

I don't know if you remember I did have a year like that. The a/c unit broke, every major appliance went and we owed the IRS 8K. You know what we prioritized, decided what to finance and what to use the emergency fund for and then we planned our vacation to Disney.

life keeps happening.

Next year we plan on doing London. My company is undergoing major restructuring so will I have a job, will I not who knows. but I do know I can't "not" live because I maybe unemployed in 10 months (might be a good thing if they offer a package because I'm close to retirement). So I'm planning our trip, if I get laid off, I'll make a decision whether to go or not but as of right now, no way am I'm postponing cause some thing might come up.

I also think folks personal comfort level comes into play. some folks hate any type of debt at all, some people don't. some folks have a higher tolerance for risk in their investments, some don't.

I take a more "big" picture view. I'm more of the how can I increase my net worth as opposed to how can i be debt free.

I love your attitude!

I was/am a person who always planned for the worst, and therefore didn't do anything. After looking back 6 years at our last vacation, and my kids getting older, I thought about it and decided that's no way to live.

We bought DVC precisely because if forced us to go somewhere! I know I'm "locked in" and owe my soul to Disney (haha) but I love it. Now, years of DVC ownership later, I look back at all the great trips we've had. Many of our kids favorite memories come from our Disney trips. I wouldn't trade it for anything.

Another perspective from friends of ours: Our friends were exactly the same way, always planning responsibly to weather any storm. Until the wife got cancer. She battled, and survived! It changed their outlook on life. DVC was part that change.

 

[kirstenb1]

We bought into DVC in 1993. We financed. I just really don't care what anyone thinks. We make decisions all the time, some right some wrong.

 

[DMKEDM]

I love this thread!

For years I've been reading the "if you can't pay for a luxury purchase you shouldn't buy" comments--usually as a non-responsive response to a question about how or where to finance, not if to finance. Each time my stomach burns. I've learned to stop reading those threads. Us internet posters can be sooo sanctimonious!

I've never known if I financed or not (per the morals of many of the DIS posters)...I used 0% credit card offers for all 6 of my purchases--repaid w/out paying so much as a nickel in finance charge, and it was before there was a fee for doing the 0% cash advance. So exactly the same cost as paying cash...but I had 6 to 12 months to pay off the total. So, did I finance? I don't know.

But one thing I do know: I'm another person who can't (or at least doesn't) "save." Just don't have the self-discipline. But I know that about myself. So I create "bills"...automatic deposits to my retirement account. The 0% financed loan. Automatic payments into my investment account. A 529 plan for my son's college expenses. Etc.

Here I am, 9 years after purchasing, having taken more trips than I can count (I've also never known whether to count the trips where I book an extra villa for the friends I'm taking as one or two trips!), with memories that are worth so much more than the money I spent. My son is through college (Ivy League) and law school (mom-paid). One way or another I muddled through.

And I'm "debt free" except for mortgage and just last month, a small car loan...(altho why "except for mortgage and car loan" counts as "debt free" I also do not know...the mortgage is not only a debt, it's a BIG debt!; the car loan is relatively small and short--but it's still a debt! I guess what I'm really saying is I have no credit card (or timeshare purchase--grin!) debt)...

We really ought to stop sitting in judgement on each other. We all make mistakes and we all make wise decisions (even if not on purpose). Maybe I'm "just lucky," but I don't think so. I've had my fair share of busted furnaces, a/c compressors, long-term care needed by my dad, roof replacements, etc. I think I just figured it out, for me...and I don't think I can or should try to figure it out for anyone else.

Thanks for the thread...loved the chance to sit up on my soapbox. Thanks!!!

 

[kim532]

We financed and I am glad we did! Bought in 2009. We have had several vacations and the memories we have because of our DVC are priceless. I actually don't think we would have ever bought if we would have waited to pay cash 100%.

I don't regret it!

Life is about balance. I chose to balance the risk of another payment to have the reward of everlasting memories with my family.

Kim

 

[DonnaL]

We also did and we are......bought our first contract almost 13 years ago and the second 3 years later, as soon as the first was paid off. Totally agree with poster who stated they used the money they would have used for Disney vacations anyway....only we paid a monthly bill with that money, got use of the points (hence deluxe accommodations for our Disney vacations!) while we were paying that monthly bill and now we own those points (and very inexpensive vacations!) for many, many years to come....

 

[Sammie]

I'll just say this: We financed our first contract years ago (and paid it off long before the end date of the loan.) And when it was finally paid off, the reaction was not "see, all of those naysayers were wrong about the evils of financing."

In reality, the reaction was something to the effect of "whew...we were fortunate that none of the worst-case scenarios manifested before we got it paid off!"

There is a very real risk involved in financing a non-essential purchase like this. Buying the DVC points isn't the only expense...rather it's just the beginning. In addition to that mortgage you've got annual dues, theme park tickets, transportation and a whole host of expenses that go hand-in-hand with using the points.

We waited about 6 years from the time we first discovered DVC until we actually purchased. And yes, prices increased over that period. The knee-jerk response is to regret not buying sooner at the lower price. But over those 6 years we bought our first house (and put a lot of money into it) and had two children. We spent 6 years sacrificing things like vacations so that we could accomplish our bigger goals.

I shutter to think of the compromises we may have been forced to make if we'd have bought the DVC points 6 years sooner and been saddled with those additional financial burdens.

Agreed, we waited 13 years after our first Disney vacation and went back every year for those 13. But we knew if needed to not go for financial reasons, we were not locked into it. Of course renting out was unheard of then, at least to us it was.

 

[jupers]

Count me in too! Bought 142 points resale in 2011 with a credit union loan paid that off and just bought a smaller contract through timesharelending. I love my points and do not mind budgeting monthly for them!