Thoughts on reimbursement for dues?

Renee H

Mouseketeer
Joined
Aug 9, 2017
so, I was just talking with one of the brokers since my husband and I are considering an offer on a contract with them. It’s a smaller broker. Apparently since the last time we bought through them they have a new policy that they will not ask the seller to pay closing costs or put a “no reimbursement for the current year’s dues” in the contract. When I asked about this they said to just shave the equivalent off of the price per point number. If purchasing something that’s around $100 per point with 2018 dues around $900... that significantly reduces the ppp figure! Especially if you were going in lower to start with. I know Disney looks at the overall price when going through ROFR... however I felt that the initial shock of such a low PPP will raise red flags .
Thoughts on this?
 
It's less work for the broker this way, and they make the same commission whether Disney ROFR's it or you sell it to a private buyer.
If you feel comfortable possibly having your money tied up for a month, just to get it back, you can go for it. Or, you can insist the broker do what you ask them to do. They are being paid to make this sale work, after all.
 
It's less work for the broker this way, and they make the same commission whether Disney ROFR's it or you sell it to a private buyer.
If you feel comfortable possibly having your money tied up for a month, just to get it back, you can go for it. Or, you can insist the broker do what you ask them to do. They are being paid to make this sale work, after all.
Right... I asked them if they would present it the way I asked and they said no. I’m with you
 
I’ve stopped working with that site and have stopped recommending people to them because of that practice... that and how ornery one of the owners has been the last few interactions I’ve had with him. And their website has managed to get more useles with each update. How does THAT happen?

There’s a certain psychology involved in presenting an offer where you can decline to reimburse for monies already paid by the seller on current UY dues. That’s an important negotiating point that this particular broker is taking away from a buyer. If it’s as Ben is suggesting and they’re being lazy, shame on them. It makes no sense to strip negotiating tools away from a buyer. And it is completely asanine to assume that a buyer should pay dues on stripped points, or that a seller will “build that [deficiency] into the asking price.”

Not a smart way to run a business; open hostility towards half the people your business relies on to function.
 


I’ve stopped working with that site and have stopped recommending people to them because of that practice... that and how ornery one of the owners has been the last few interactions I’ve had with him. And their website has managed to get more useles with each update. How does THAT happen?

There’s a certain psychology involved in presenting an offer where you can decline to reimburse for monies already paid by the seller on current UY dues. That’s an important negotiating point that this particular broker is taking away from a buyer. If it’s as Ben is suggesting and they’re being lazy, shame on them. It makes no sense to strip negotiating tools away from a buyer. And it is completely asanine to assume that a buyer should pay dues on stripped points, or that a seller will “build that [deficiency] into the asking price.”

Not a smart way to run a business; open hostility towards half the people your business relies on to function.
Thank you... you said the words that I was thinking about this. He made it seem like it was only “me” who had this way of thinking. I’m glad to hear that I’m not alone.
 
Right... I asked them if they would present it the way I asked and they said no. I’m with you

They definitely have figured out the way to keep their commission higher as it's based on price per point as I recall and all the rest is just reimbursements that the commission isn't calculated on.

However, they are supposed to be acting as a transaction broker representing both buyer and seller in the real estate transaction. It sounds to me like maybe they are violating that in some way? Maybe not as I'm not positive about their responsibilities as a real estate agent but they are definitely representing themselves over any buyers.
 
They definitely have figured out the way to keep their commission higher as it's based on price per point as I recall and all the rest is just reimbursements that the commission isn't calculated on.

However, they are supposed to be acting as a transaction broker representing both buyer and seller in the real estate transaction. It sounds to me like maybe they are violating that in some way? Maybe not as I'm not positive about their responsibilities as a real estate agent but they are definitely representing themselves over any buyers.
I’m not sure if it’s the same for timeshares but I sell residential real estate and it’s law that we present ALL offers to a seller.
 


Well, as a current seller, I contacted a couple brokers and found out that they won't ask buyers for dues from 2018 even when full points are there. And if you borrowed some of 2019 points into 2018 (for a trip that was cancelled to sell contract), they won't ask for dues for those points either.
 
And for the record... I’d be mad as a seller if I knew someone wanted to make an offer and the broker wouldn’t present me an offer and the buyer walked. I’D WANT to make that decision for myself to accept, counter, refuse.
 
They definitely have figured out the way to keep their commission higher as it's based on price per point as I recall and all the rest is just reimbursements that the commission isn't calculated on.
See, that's the part I don't get. Say they are telling sellers to ask for $100/point. By insisting that buyers reduce the offer price to account for dues compensation (or lack thereof), they are effectively telling buyers to offer less for the selling price which actually works against their profit calculations, right?

Unless this is some short-sighted way to get buyer's to recognize what the effective cost is, or to dissuade low-ball offers, it's a practice that makes zero no sense to me.
 
Well, as a current seller, I contacted a couple brokers and found out that they won't ask buyers for dues from 2018 even when full points are there. And if you borrowed some of 2019 points into 2018 (for a trip that was cancelled to sell contract), they won't ask for dues for those points either.
That’s interesting..And here I thought it was standard practice to just ask for current years dues.... and then it becomes a negotiation point
 
Well, as a current seller, I contacted a couple brokers and found out that they won't ask buyers for dues from 2018 even when full points are there. And if you borrowed some of 2019 points into 2018 (for a trip that was cancelled to sell contract), they won't ask for dues for those points either.
I guess the argument could be made that the 2019 points (borrowed into 2018 UY), are less valuable because they are not afforded the same flexibility as un-borrowed points?

I'm not making that argument. My only position is that all this should be negotiating points for the sellers and buyers to work out; one that broker's should be facilitating, not running interference on.
 
See, that's the part I don't get. Say they are telling sellers to ask for $100/point. By insisting that buyers reduce the offer price to account for dues compensation (or lack thereof), they are effectively telling buyers to offer less for the selling price which actually works against their profit calculations, right?

Unless this is some short-sighted way to get buyer's to recognize what the effective cost is, or to dissuade low-ball offers, it's a practice that makes zero no sense to me.

Yep - I was actually reversing that in my first post. Or maybe I'm remembering incorrectly about the commission calculation but I'm almost positive it's only on the point cost.

They still ought to allow the offer to be presented however the buyer wishes to structure it. I also do think the price/pt stands out more than anything and I'd rather negotiate on the dues and/or closing costs.
 
That’s interesting..And here I thought it was standard practice to just ask for current years dues.... and then it becomes a negotiation point

For quite a few years now I've often seen listings not asking for the current years dues to be reimbursed once it gets to be the last month or two of the year. It's the one and only acknowledgement in resale I've ever seen about how dues are calculated and should be reimbursed. Not on all listings but it definitely shows up around this time of the year. Or maybe they it's sellers ways to get it sold before they have to pay the upcoming dues.
 
Yep - I was actually reversing that in my first post.

They still ought to allow the offer to be presented however the buyer wishes to structure it. I also do think the price/pt stands out more than anything and I'd rather negotiate on the dues and/or closing costs.

Exactly! Agreed 100%
 
If they aren't be accommodating find a broker who will. Think most brokers provide the same value-add services just an issue with traffic etc. But for second time re-sale buyers I'd expect they cross reference all the sites anyway
 
At the end of the day a point is a point and if a broker wouldn't submit my offer I just won't work with them and I will get the contract from someone else. It may take a bit but when it is all said and done, the point looks and acts the same in my account no matter how I got it.
 
so, I was just talking with one of the brokers since my husband and I are considering an offer on a contract with them. It’s a smaller broker. Apparently since the last time we bought through them they have a new policy that they will not ask the seller to pay closing costs or put a “no reimbursement for the current year’s dues” in the contract. When I asked about this they said to just shave the equivalent off of the price per point number. If purchasing something that’s around $100 per point with 2018 dues around $900... that significantly reduces the ppp figure! Especially if you were going in lower to start with. I know Disney looks at the overall price when going through ROFR... however I felt that the initial shock of such a low PPP will raise red flags .
Thoughts on this?
Get a new broker. They should present any offer you wish to the seller no matter what.

FWIW I like to present more creative offers with higher $'s per point and ask sellers to pay dues and/or closing costs or some portion thereof. IMO, while ROFR will likely look at the overall package price, $'s per point matters more first and foremost. How often do you see major outlier lower cost per point contracts clear ROFR? Not often. Who pays closing and or dues is easily buried when analyzing contract sales, which is a benefit to Disney in keeping resale $'s per point higher so that they appear closer to the direct price.

Just my 2 cents.
 
I’m not sure if it’s the same for timeshares but I sell residential real estate and it’s law that we present ALL offers to a seller.
My understanding is they must present all offers unless they have written directions otherwise. My guess is their contract includes this language. I'd move on, unethical position IMO.
 

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