Thinking about purchasing DVC... A couple of questions...

[cgcruz]

We took the DVC tour this past August while on vacation. We absolutely fell in love with SSR. It's so beautiful and QUIET. But we werent ready to pour down $2000 on the spot. When we do decide to do this, we will take the 10 year payment plan. It's nice in case there is a time when I run into any financial issues. If I do this, this will pbbly be like 18-24 months from now. I know all I could afford is the 150 minimum for the forseeable future. Right now it's just me and my fiance , no kids. So right now, a studio is ok, but would definately want a 1 bedroom. We really dont need more than a 5 day getaway a year for our disney fix. Will there be a season when a 1 bedroom SSR will be possible with 150 points?

Ok , so i'm planning a trip for 5 nights to SSR on rented points in March 2006 to see if we even would like to stay there? Should we check it out or save our money towards the deposit of DVC at a later time? ( We just came from a trip from WDW August 21-26),

Also, do you think the cost of DVC through Disney for the minimum 150 points will go up a lot in the next 18-24 months? What was the price of 150 points 2 years ago?

Sorry for all the questions, but it will be a great help. Thanks!

 

[dianeschlicht]

In January, September, and the first 2 weeks of December, you can get a 1 bedroom for 6 nights at SSR. A studio will be 95 points for a whole week. With banking and borrowing, you could easily do a 1 or 2 bedroom occationally. BTW, don't bet on always being satisfied with 5 days! We all did that when we paid for each trip at a time, but you learn quickly how many things there actually are to do at WDW, and even with multiple 10 day plus trips each year, we are never bored!

DVC points are always increasing, and there's no way to know when they will break the $100 per point mark. We purchased 8 years ago at $62.50 a point, so you can see that it does go up and often and substancially.

I would caution you to try not to finance for such a long period of time. The longer you finance, the less financial sense a DVC prepaid vacation makes. The idea is to lock in your vacation time over a 40-50 year period at today's prices, but if you pay interest, you aren't realizing as much savings. It sounds like you are young and probably don't have much in the asset department right now. If you do own your own home or are planning on buying one in the near future, you might consider making your DVC purchase using home equity for the loan or adding that amount into your mortgage. The interest will be deductible, where a timeshare loan would not be, and the interest rate will be significantly less.

 

[Figment2]

Actually, Diane, DVC does qualify as a "second Home" and any mortgage interest is tax deductible on your US federal return. I do agree, though, that the interest would be lower on a home equity loan.

Cyn

 

[vascubaguy]

I would imagine that 2 years from now points will be over $100 per point, however, if you are looking for SSR in 2 years, you would probably be able to find some good deals on SSR contracts on the resale market.

Oh, and I believe the OP was saying they would take the 10 year financing option, but pay it off sooner. It's just nice to have that flexibility to stretch it out and pay a little less if/when money gets a little tight. I would agree that you can get MUCH lower interest if you could do a home equity.

 

[Dean]

Actually, Diane, DVC does qualify as a "second Home" and any mortgage interest is tax deductible on your US federal return. I do agree, though, that the interest would be lower on a home equity loan.

Cyn

It depends. If you finance with DVC. it would qualify. If you finance with Tammac or otherwise it is unlikely to qualify.

 

[Daitcher]

We took the DVC tour this past August while on vacation. We absolutely fell in love with SSR. It's so beautiful and QUIET. But we werent ready to pour down $2000 on the spot. When we do decide to do this, we will take the 10 year payment plan. It's nice in case there is a time when I run into any financial issues. If I do this, this will pbbly be like 18-24 months from now. I know all I could afford is the 150 minimum for the forseeable future. Right now it's just me and my fiance , no kids. So right now, a studio is ok, but would definately want a 1 bedroom. We really dont need more than a 5 day getaway a year for our disney fix. Will there be a season when a 1 bedroom SSR will be possible with 150 points?

Ok , so i'm planning a trip for 5 nights to SSR on rented points in March 2006 to see if we even would like to stay there? Should we check it out or save our money towards the deposit of DVC at a later time? ( We just came from a trip from WDW August 21-26),

Also, do you think the cost of DVC through Disney for the minimum 150 points will go up a lot in the next 18-24 months? What was the price of 150 points 2 years ago?

Sorry for all the questions, but it will be a great help. Thanks!

I would consider not joining. If you have to finance DVC then IMO you can't afford it. Payments for ten years plus interest add up. Remember the annual dues for 50 years and yes they do and will increase. My advice would be to start saving for your future. Down the road if you have a comfortable nest egg plus some gravy, use the gravy for a DVC purchase. DVC is not an investment and IMO doesn't save anyone money. Pay yourself first and the bill collectors later. DVC was a luxury purchase for us and one we could comfortably afford. We would not have set ourselves back by joining. Good luck and really think this through. You have plenty of time to join down the road and in the mean time renting points would be the way to go.

DAVE

 

[crisi]

It depends. If you finance with DVC. it would qualify. If you finance with Tammac or otherwise it is unlikely to qualify.

There are additional tax rules as well. Read the IRS rules yourself or talk to a tax professional. Don't take the word of anyone here on if a DVC mortgage is deductible or not. Don't even take the word of your DVC salesperson, they don't know if you qualify based on other rules in the tax code.

 

[Lisa P.]

Cgcruz, I agree with Daitcher/Dave. Consider carefully before buying DVC on credit. You'll pay far more in interest payments than you'd save on increasing costs. Another purchase incentive or another resale package is always waiting around the corner. There's no urgency to buy.

By your sig, you've been staying offsite and at value hotels, planning another stay at Pop in 2006. Have you enjoyed your vacations? DVC costs more than these options.

Consider saving up at least 50% of your purchase upfront. If you cannot afford to do that, you may not be able to afford to keep DVC later. I speak from experience on this! We bought 150 points for cash (no loan at all) and planned to buy 2 more contracts of 150 apiece (we have 3 kids, need 2BRs). So we considered our 150 points cash purchase like a 33% down buy-in to our plan - gradually paid in cash. Our circumstances changed and then we could not buy any more points. What we could get for 150 points was not worth the maint fees we had to pay so it made sense for us to sell DVC. IMHO, the lesson learned was... we don't make an expensive leisure purchase until/unless we know that we can afford it in full. If we need to finance a leisure purchase, we cannot afford it. Nothing wrong with that, just a simple fact.

There are lots of ways to enjoy fun WDW vacations!

 

[Cruelladeville]

DAVE!

I financed over 10 years on my very first contract, and paid it off in 3 years. I think that plan is just being frugal, provided it does get paid up sooner. You have to be disciplined, though. I bought that contract at $54 a point about 8 1/2 years ago, just before the jump in prices. After that, the prices increased regularly in $5-$7 increments.

 

[JPC]

I would consider not joining. If you have to finance DVC then IMO you can't afford it. Payments for ten years plus interest add up. Remember the annual dues for 50 years and yes they do and will increase. My advice would be to start saving for your future. Down the road if you have a comfortable nest egg plus some gravy, use the gravy for a DVC purchase. DVC is not an investment and IMO doesn't save anyone money. Pay yourself first and the bill collectors later. DVC was a luxury purchase for us and one we could comfortably afford. We would not have set ourselves back by joining. Good luck and really think this through. You have plenty of time to join down the road and in the mean time renting points would be the way to go.

DAVE

ditto

 

[Daitcher]

DAVE!

I financed over 10 years on my very first contract, and paid it off in 3 years. I think that plan is just being frugal, provided it does get paid up sooner. You have to be disciplined, though. I bought that contract at $54 a point about 8 1/2 years ago, just before the jump in prices. After that, the prices increased regularly in $5-$7 increments.

Why the angry face next to DAVE!? I was just giving my honest opinion. Take it for what is worth...... not much .


DAVE

 

[Cruelladeville]

Ok