They did what?! Resale issues

[RoseGold]

I’m surprised this doesn’t have to go through ROFR again. Your essentially now buying the contract for about $30 less per point.

Because the contract contains a provision at over market for the points. Disney does not buy $20 points. They could have used three years worth of points, it only makes the contract less valuable to Disney. That's part of the reason why the points purchase part is punitive to dishonest sellers.

 

[RoseGold]

I don't have the emotional energy to start over right now.

I know this seems like a lot, but even if this falls apart, DVC is not going anywhere. I think after dues could be better time to buy. There's DVC all over the place, there is plenty of it. Don't let a dishonest seller block you from getting your contract. You can do this again, it will be EASIER next time, actually.

 

[EE_Mom]

I’m surprised this doesn’t have to go through ROFR again. Your essentially now buying the contract for about $30 less per point. Not that I don’t agree with you, I’m just surprised is all.

Is this a loophole around ROFR? You could offer a price just above where you know it will pass, but let seller take a last minute trip and settle up at a price way below where Disney would normally take it.

From what I understand is that you close the contract as it is written but you add to it another contract saying the seller agrees to reimburse you at closing for what compensation is agreed on.

 

[EE_Mom]

UPDATE: This morning when I checked my phone I had a voicemail but no missed call. My agent called yesterday afternoon and it sounds like there may be a mix-up. It sounds like the seller has more than one contract with the same amount of points for the same resort. From his initial assessment, all of the current use year points are there but the banked point amount isn't adding up. He has to do more verifying and get back to me. I am glad he is being thorough. Crossing my fingers that this was all a big misunderstanding.

 

[RoseGold]

Read your contact and send an email, so in writing. You want to know exactly how many points are missing, and you know that the contract rate is X. You want to know what the options are.

The sellers have A LOT more to lose than you do, don’t settle for less than the contract amount, if you even want to take the contract at all at this point.

 

[EE_Mom]

Read your contact and send an email, so in writing. You want to know exactly how many points are missing, and you know that the contract rate is X. You want to know what the options are.

The sellers have A LOT more to lose than you do, don’t settle for less than the contract amount, if you even want to take the contract at all at this point.

I went back and checked the contract. There is nothing in it about compensation for missing points. It just states in a clause that we are to receive 106 banked points from 2019 and 175 points from 2020 and going forward. We won't settle for less than the contract amount. It will be disappointing if this doesn't work but we know there will be other opportunities if this falls through.

 

[davidl81]

Your update makes me feel better about he seller. It could just be an honest mix up if they used the wrong account. And there is always the chance that the seller just does not totally understand all of the DVC rules. The may have thought that in selling the contract all of the banked points would go away or something crazy like that, so they were just using them before they went away. I like to think this way instead of just jumping to straight accusations right away. It's the eternal optimist in me.

 

[RoseGold]

We won't settle for less than the contract amount. It will be disappointing if this doesn't work but we know there will be other opportunities if this falls through.

I would take back the offer of $18 in writing, don't settle for that. Ask what the offer is. I would expect an offer from the sellers at $25/point or more. They are still on the hook for commission, so it's their interest to make this work. I would expect an offer and a clear explanation of how many points are left today.

Walking away is fine, maybe the best option for you. You have nothing to lose. There are other contracts in the sea, I would just keep going, thought maybe I'd consider a $25+ offer

 

[MICKIMINI]

I'm one of the lucky ones that got an extra 19 points when I closed on a small contract this summer. The broker didn't get much info from DVC but I'm guessing it has something to do with the closure earlier this year.

I certainly hope it is a mistake and you get what you paid for!

I should clarify those 19 points were banked.

 

[Grumpy Mouse]

So we were in the process of buying a resale contract at the Poly. It had about 3/4 contract year points banked and a full year for the upcoming use year. We made an offer, passed ROFR, received/signed/returned closing paperwork and money to close about 2 weeks after we got them. It was not easy finding a notary and witnesses with many banks having their lobbies closed. After our closing paperwork was received we waited a bit and didn't hear anything. We inquired and found out the seller had not returned their closing paperwork yet. A day or so later we were informed the sellers had sent their documents and they would be received the following day.

Great!

Well, a few days later I had a missed call from our agent. I thought maybe we missed a signature or something on our paperwork. It turns out in the time between accepting our offer and closing the sellers decided to take a few vacations and had used up all of the banked points and part of the upcoming year. The agent was checking the points balance before closing and discovered the discrepancy. Our agent has been very helpful and responsive. I don't get it, were the sellers trying to pull a fast one hoping no one would notice? They used almost a full contract year's worth of points. We had already been planning our upcoming vacations based on the point balances in the contract. We put in an offer to be reimbursed to continue the transaction. We are pretty disappointed considering the amount of time invested in this whole process but we are prepared to walk away. Unfortunately, there isn't much on the market right now that suits what we want and need. If they don't accept our offer we will probably wait until early next year to try again. I don't have the emotional energy to start over right now.

Has anyone dealt with an issue like this and what was your outcome?

I bought an AKV contract several months ago and this was the VERY issue I was concerned about after reading a blog post by one of those dvc guys (dvcfan, or dvcguy, or something like that). This happens much more frequently than the brokers would ever let on - misunderstanding or not.

The reason: Disney allows it to happen.

What should happen: the day Disney waives ROFR, the points should be verified against the written contract and the account should be frozen. Oh for a perfect world...

What actually happens: you are on your own and your broker and title will likely require you to sign a "hold harmless" document in the closing papers.

Something like this:

<<
Buyer understands that XXXXXX Title guarantees title only.

WE as a company in no way guarantee the sellers’ claims of occupancy and use of this timeshare period. Proper representation regarding the transaction is the sole responsibility of the seller.
>>

Now, as others have pointed out, there will be (or should be) clauses in the contract promising reimbursement for point discrepancies. But the seller could be long gone with your money by then. At a minimum it will be a huge stress on you and your family, with no guarantee of a good outcome.

Based on all of this, I did the following prior to closing my AKV contract:

1) I made the seller send me screen shots of their DVC dashboard the day before closing
2) I made the broker (owner of the company) put in writing that they would immediately "make whole" any points discrepancies. I didn't want the money nor the hassle.
3) I made the broker put in writing they would not release funds to the seller until Disney actually transferred the contract.

Disney could stop all of this nonsense but they refuse. I suspect they see it as one more potential negative to the resale process.

Sorry you're dealing with this now and good luck.

 

[Sandisw]

I bought an AKV contract several months ago and this was the VERY issue I was concerned about after reading a blog post by one of those dvc guys (dvcfan, or dvcguy, or something like that). This happens much more frequently than the brokers would ever let on - misunderstanding or not.

The reason: Disney allows it to happen.

What should happen: the day Disney waives ROFR, the points should be verified against the written contract and the account should be frozen. Oh for a perfect world...

What actually happens: you are on your own and your broker and title will likely require you to sign a "hold harmless" document in the closing papers.

Something like this:

<<
Buyer understands that XXXXXX Title guarantees title only.

WE as a company in no way guarantee the sellers’ claims of occupancy and use of this timeshare period. Proper representation regarding the transaction is the sole responsibility of the seller.
>>

Now, as others have pointed out, there will be (or should be) clauses in the contract promising reimbursement for point discrepancies. But the seller could be long gone with your money by then. At a minimum it will be a huge stress on you and your family, with no guarantee of a good outcome.

Based on all of this, I did the following prior to closing my AKV contract:

1) I made the seller send me screen shots of their DVC dashboard the day before closing
2) I made the broker (owner of the company) put in writing that they would immediately "make whole" any points discrepancies. I didn't want the money nor the hassle.
3) I made the broker put in writing they would not release funds to the seller until Disney actually transferred the contract.

Disney could stop all of this nonsense but they refuse. I suspect they see it as one more potential negative to the resale process.

Sorry you're dealing with this now and good luck.

Not sure how you freeze a contract without removing it. Many owners have more than one contract in their membership so they can’t disable that.

One of the reasons the contract stays Is because they can’t transfer it from it’s owner until they are no longer the owner,

Some sellers have backed out, even after ROFR. Unfortunately, the seller owns it until closing and Disney preventing access could get them into legal trouble, IMO.

No different than any other piece of real estate. I think it’s one of the reasons that some title companies are holding funds to ensure buyer gets what they are supposed to get.

 

[RoseGold]

Now, as others have pointed out, there will be (or should be) clauses in the contract promising reimbursement for point discrepancies. But the seller could be long gone with your money by then. At a minimum it will be a huge stress on you and your family, with no guarantee of a good outcome.

I mean that's a little dramatic for a contract that hasn't even closed for this exact reason.

 

[Grumpy Mouse]

I mean that's a little dramatic for a contract that hasn't even closed for this exact reason.

Apparently it happens before and AFTER closing, in part because Disney is taking so long to transfer ownership. And those are not my words - I wish I could find the article - it came from an experienced DVC resale person.

And tell the OP "it's a little dramatic"...

 

[Grumpy Mouse]

Not sure how you freeze a contract without removing it. Many owners have more than one contract in their membership so they can’t disable that.

One of the reasons the contract stays Is because they can’t transfer it from it’s owner until they are no longer the owner,

Some sellers have backed out, even after ROFR. Unfortunately, the seller owns it until closing and Disney preventing access could get them into legal trouble, IMO.

No different than any other piece of real estate. I think it’s one of the reasons that some title companies are holding funds to ensure buyer gets what they are supposed to get.

Certainly you or I could not 'freeze' anything - but Disney can. And the contract will still be there - the seller just won't be able to make any changes or book anything against it. As for multiple contracts, that's what computers are for. These are really simple problems for the right piece of software.

And if the seller backs out after ROFR - it will be on them to fix it.

Again, tell the OP this problem is "just too hard to solve"...

 

[Sandisw]

Certainly you or I could not 'freeze' anything - but Disney can. And the contract will still be there - the seller just won't be able to make any changes or book anything against it. As for multiple contracts, that's what computers are for. These are really simple problems for the right piece of software.

And if the seller backs out after ROFR - it will be on them to fix it.

Again, tell the OP this problem is "just too hard to solve"...

But legally, the contract is the owners until it is not and Disney would have no reason to freeze an account if dues are paid and any financing is up to date.

DVCM simply manages our ownership and it’s not up to them to make sure a seller doesn’t do anything they should not they when selling,

Again, they have no legal right to prevent an owner from using their membership, expect for the issues I mentioned above.

 

[Aussie RJ]

One lesson for all would be buyers. Don’t pay the closing balance until you have confirmation of the sellers signed agreement. I know it’s still not fool proof but it does mean some peace of mind.

 

[SleeplessInTO]

I agree. I don’t see why Disney would freeze the account after ROFR. I’m sure Disney would prefer people to buy direct and avoid this potential issue entirely.

 

[KAT4DISNEY]

UPDATE: This morning when I checked my phone I had a voicemail but no missed call. My agent called yesterday afternoon and it sounds like there may be a mix-up. It sounds like the seller has more than one contract with the same amount of points for the same resort. From his initial assessment, all of the current use year points are there but the banked point amount isn't adding up. He has to do more verifying and get back to me. I am glad he is being thorough. Crossing my fingers that this was all a big misunderstanding.

I've had similar type issues when selling - twice. One sounds quite like yours where I had 2 contracts with the same number of points from splitting a direct purchase. Got that straightened out quickly. Then there was the other one where on my listing contract I filled out the part stating I had an existing reservation that I would cancel if the contract did sell. So I get a fairly nasty accusatory email just a day after accepting an offer that the points I had listed did not match what they just checked. They complete ignored the section that they provided on the contract about existing reservations. Happy I was not with that broker especially since we didn't even have a signed contract yet and I'd had verbal agreements fall thru and wasn't planning to cancel until we did. I don't know why they even had a disclosure section and no apology for having missed it and given me the nastiness.

ie - yes, misunderstandings happen. I hope that is all it is for you.

 

[KAT4DISNEY]

Apparently it happens before and AFTER closing, in part because Disney is taking so long to transfer ownership. And those are not my words - I wish I could find the article - it came from an experienced DVC resale person.

And tell the OP "it's a little dramatic"...

OP isn't being dramatic because they are in the midst of it. You're relating very rare occurrences for the number of resale contracts that do go thru without a hitch.

 

[Minniesgal]

At this point, the only reason we are attempting to salvage this with an offer is the amount of time that has gone into this. ROFR is done. The number of points and use year fits. They have our signed closing paperwork and money. It is a done deal if they accept. No more worry or waiting. It just makes me angry that they returned their closing paperwork without disclosing they used the points. It feels shady on the sellers' part. Our agent caught it and stopped the closing until this was sorted out.

ROFR is wrong though and will need to be redone