Timeshare Broker Selling DVC Really Low

[BWV Dreamin]

I have seen and verified 3 Vero Beach contracts that are selling for $45.00/pt. Two are stripped, didn't inquire about the 3rd. This is really testing the low's, even for Vero Beach. Isn't there a fiduciary responsibility on the part of the broker to set the resale's price at the point that it won't likely get ROFR'd? I mean nothing is certain, but at $45/pt. I can't imagine Disney passing these contracts. Isn't this even below the price Disney would by back directly?

 

[mickeyfan0805]

I don't know what the Disney buy-back number is, but most of the recently passed contracts on the rofr thread are showing prices in the 60's and 70's. However, there is not a single VB contract listed on which Disney excercised its right. My only thought on this is that I do expect VB contract prices to be dropping (as well as HH). With the increasing difficulty of getting reservations at teh 7-month window (something I am reading about recurrently on this board), non-theme park locations would be less appealing IMHO. I don't know what would happen with the $45 contract, but until they try, no one is going to know.

 

[ZekeKelso]

Isn't there a fiduciary responsibility on the part of the broker to set the resale's price at the point that it won't likely get ROFR'd?

Their only responsibility is to the seller, and the seller doesn't care if it gets ROFRed. They have a responsibility to let the seller know they could sell for a higher price, but there are situations where the seller doesn't care.

 

[BWV Dreamin]

Their only responsibility is to the seller, and the seller doesn't care if it gets ROFRed. They have a responsibility to let the seller know they could sell for a higher price, but there are situations where the seller doesn't care.

How about a responsibilty to the buyer? In these types of transactions, the buyer doesn't have another broker representing them, they are dealing with the "sellers" agent so to speak. How about the brokers "rep" when setting contracts really low? Once a buyer goes thru the anxiety of getting thru ROFR only to be refused, would the buyer want to go thru that again with the same broker at the same price? Sure the buyer could up the price, but that would be the "seller's" agent suggesting that, a conflict of interest?

 

[DebbieB]

As long as the buyer knows the ROFR rules, I'd say there's nothing wrong with it. I think if I was looking for points, I might roll the dice for $45. I don't know why the seller is going that low.

 

[snowbunny]

How about a responsibilty to the buyer? In these types of transactions, the buyer doesn't have another broker representing them, they are dealing with the "sellers" agent so to speak.?

Yes they are. The listing contract (same as when you go to look at a house for sale) is between the seller and the listing agent.

Sure the buyer could up the price, but that would be the "seller's" agent suggesting that, a conflict of interest?

No, as in all real estate transactions, the fiduciary responsibility of the listing agent is to the seller. That means obtaining the highest possible price for the seller. If the buyer wants a realtor that has a fiduciary obligation to the buyer, he/she would need to enlist a buyer's agent.

Caveat emptor - let the buyer beware.

 

[BWV Dreamin]

Yes they are. The listing contract (same as when you go to look at a house for sale) is between the seller and the listing agent.



No, as in all real estate transactions, the fiduciary responsibility of the listing agent is to the seller. That means obtaining the highest possible price for the seller. If the buyer wants a realtor that has a fiduciary obligation to the buyer, he/she would need to enlist a buyer's agent.

Caveat emptor - let the buyer beware.

Yes, actually by law now, the buyer of real estate has to have representation unless they agree to "dual agency". However, I don't think this applies here in these timeshare transactions. Do you know of anyone who has contracted a buyer's agent in a timeshare purchase? I know I didn't, nor was I referred to one at my time of purchase.

 

[Jason@dvcstore]

You should ask the broker if they are working as a transacation broker. If they are then you should have to sign the "Important Notice" below.

I agree with ZekeKelso as most sellers don't care if their properties are bought back. I also agree with DebbieB that the buyer should be made aware of ROFR (not everyone knows) and if they want to take a chance then they can. Be advised that as a buyer you could always offer more per point to make sure it makes it through ROFR.


IMPORTANT NOTICE

FLORIDA LAW REQUIRES THAT REAL ESTATE LICENSEES PROVIDE THIS NOTICE TO POTENTIAL SELLERS AND BUYERS OF REAL ESTATE.

You should not assume that any real estate broker or salesperson represents you unless you agree to engage a real estate licensee in an authorized brokerage relationship, either as a single agent or as a transaction broker. You are advised not to disclose any information you want to be held in confidence until you make a decision on representation.

TRANSACTION BROKER NOTICE

FLORIDA LAW REQUIRES THAT REAL ESTATE LICENSEES OPERATING AS TRANSACTION BROKERS DISCLOSE TO BUYERS AND SELLERS THEIR ROLE AND DUTIES IN PROVIDING A LIMITED FORM OF REPRESENTATION.


As a transaction broker, Mazor Realty and its Associates, provides to you a limited form of representation that includes the following duties:
1. Dealing honestly and fairly;
2. Accounting for all funds;
3. Using skill, care, and diligence in the transaction;
4. Disclosing all known facts that materially affect the value of residential real property and are not readily observable to the buyer;
5. Presenting all offers and counteroffers in a timely manner, unless a party has previously directed the licensee otherwise in writing;
6. Limited confidentiality, unless waived in writing by a party. This limited confidentiality will prevent disclosure that the seller will accept a price less than the asking or listed price, that the buyer will pay a price greater than the price submitted in a written offer, of the motivation of any party for selling or buying property, that a seller or buyer will agree to financing terms other than those offered, or of any other information requested by a party to remain confidential; and
7. Any additional duties that are entered into by this or by separate written agreement.

Limited representation means that a buyer or seller is not responsible for the acts of the licensee. Additionally, parties are giving up their rights to the undivided loyalty of the licensee. This aspect of limited representation allows a licensee to facilitate a real estate transaction by assisting both the buyer and the seller, but a licensee will not work to represent one party to the detriment of the other party when acting as a transaction broker to both parties.

______________________________
Date


______________________________
Signature

______________________________
Signature

 

[BWV Dreamin]

You should ask the broker if they are working as a transacation broker. If they are then you should have to sign the "Important Notice" below.

I agree with ZekeKelso as most sellers don't care if their properties are bought back. I also agree with DebbieB that the buyer should be made aware of ROFR (not everyone knows) and if they want to take a chance then they can. Be advised that as a buyer you could always offer more per point to make sure it makes it through ROFR.


IMPORTANT NOTICE

FLORIDA LAW REQUIRES THAT REAL ESTATE LICENSEES PROVIDE THIS NOTICE TO POTENTIAL SELLERS AND BUYERS OF REAL ESTATE.

You should not assume that any real estate broker or salesperson represents you unless you agree to engage a real estate licensee in an authorized brokerage relationship, either as a single agent or as a transaction broker. You are advised not to disclose any information you want to be held in confidence until you make a decision on representation.

TRANSACTION BROKER NOTICE

FLORIDA LAW REQUIRES THAT REAL ESTATE LICENSEES OPERATING AS TRANSACTION BROKERS DISCLOSE TO BUYERS AND SELLERS THEIR ROLE AND DUTIES IN PROVIDING A LIMITED FORM OF REPRESENTATION.


As a transaction broker, Mazor Realty and its Associates, provides to you a limited form of representation that includes the following duties:
1. Dealing honestly and fairly;
2. Accounting for all funds;
3. Using skill, care, and diligence in the transaction;
4. Disclosing all known facts that materially affect the value of residential real property and are not readily observable to the buyer;
5. Presenting all offers and counteroffers in a timely manner, unless a party has previously directed the licensee otherwise in writing;
6. Limited confidentiality, unless waived in writing by a party. This limited confidentiality will prevent disclosure that the seller will accept a price less than the asking or listed price, that the buyer will pay a price greater than the price submitted in a written offer, of the motivation of any party for selling or buying property, that a seller or buyer will agree to financing terms other than those offered, or of any other information requested by a party to remain confidential; and
7. Any additional duties that are entered into by this or by separate written agreement.

Limited representation means that a buyer or seller is not responsible for the acts of the licensee. Additionally, parties are giving up their rights to the undivided loyalty of the licensee. This aspect of limited representation allows a licensee to facilitate a real estate transaction by assisting both the buyer and the seller, but a licensee will not work to represent one party to the detriment of the other party when acting as a transaction broker to both parties.

______________________________
Date


______________________________
Signature

______________________________
Signature

Wow, thanks Jason. I was not forwarded this form from either your company nor another that I bought my DVC timeshare's from. Do you routinely include this in the inital paperwork sent to the buyer?

 

[iloveokw]

I have used the Timeshare Store many times - I just went to their site and no Vero contracts are listed for under $60 -

 

[mickeyfan0805]

Wow, thanks Jason. I was not forwarded this form from either your company nor another that I bought my DVC timeshare's from. Do you routinely include this in the inital paperwork sent to the buyer?

Our current contract is going through TTS and we were provided with this paperwork and required to sign it along with our contract. They have been very forthright on everything so far.

I tend to be a little cold when it comes to this kind of thing, but if someone is going to make an offer on an extremely low contract, or make offers without understanding the process (such as ROFR) on a 10k+ transaction, then the fault is really on them. I'm not going to blame a reselleling agent for doing what their clients ask. It is the responsibility of the buyer to do the homework, if the seller wants to make sure they unload it quickly, and are willing to take a hit to do it, that is their right.

 

[BWV Dreamin]

Our current contract is going through TTS and we were provided with this paperwork and required to sign it along with our contract. They have been very forthright on everything so far.

I tend to be a little cold when it comes to this kind of thing, but if someone is going to make an offer on an extremely low contract, or make offers without understanding the process (such as ROFR) on a 10k+ transaction, then the fault is really on them. I'm not going to blame a reselleling agent for doing what their clients ask. It is the responsibility of the buyer to do the homework, if the seller wants to make sure they unload it quickly, and are willing to take a hit to do it, that is their right.

Just curious, did you decline representation?

 

[mickeyfan0805]

Just curious, did you decline representation?

Only sort of. As I understood the document, we are agreeing that we will not have an advocate in the sense of someone battling for our interest regardless of the interests of the seller. In that manner, we are declining representation.

However, as a transaction broker, the licensee is agreeing to oversee the process and contracts in a way that they represent the interest of both the buyer and the seller. The way I took this, I looked at it as meaning thet TTS was going to advocate for the process - making sure everything was done properly and in order. In doing so, they are looking after both me and the seller. They are not my advocate, but they agree that they won't advocate for the seller either.

This is why I asked around about agents before I tendered an offer. I wanted to make sure it was a reputable company that I felt would follow through on their responsibility to both parties.

Jason could probably explain it in better terms, but this was my layman's way of understanding.

 

[Jason@dvcstore]

Wow, thanks Jason. I was not forwarded this form from either your company nor another that I bought my DVC timeshare's from. Do you routinely include this in the inital paperwork sent to the buyer?

This is sent to the buyer when they purchase. They are sent typically three items---1) The agreement 2) Instructions and 3) Transacation broker notice.

For sellers the transacation broker notice is sent along with the listing agreement.

 

[BWV Dreamin]

This is sent to the buyer when they purchase. They are sent typically three items---1) The agreement 2) Instructions and 3) Transacation broker notice.

For sellers the transacation broker notice is sent along with the listing agreement.

Ok, without digging out my contracts, I truely do not remember signing this form on either of my contracts. In the event that this form is not signed by the buyer, is it than processed as a "waiver of representation", but is the process performed as mentioned, in the best interest of BOTH parties in order to facilitate the ratification of the contract? Maybe there was another type of form used, I truely don't recall this particular form.

 

[Disneyaholic]

I don't know what the Disney buy-back number is, but most of the recently passed contracts on the rofr thread are showing prices in the 60's and 70's. However, there is not a single VB contract listed on which Disney excercised its right. My only thought on this is that I do expect VB contract prices to be dropping (as well as HH). With the increasing difficulty of getting reservations at teh 7-month window (something I am reading about recurrently on this board), non-theme park locations would be less appealing IMHO. I don't know what would happen with the $45 contract, but until they try, no one is going to know.

That assumes that members only want to stay at the WDW locations.

 

[Jason@dvcstore]

Ok, without digging out my contracts, I truely do not remember signing this form on either of my contracts. In the event that this form is not signed by the buyer, is it than processed as a "waiver of representation", but is the process performed as mentioned, in the best interest of BOTH parties in order to facilitate the ratification of the contract? Maybe there was another type of form used, I truely don't recall this particular form.

If you send me an e-mail with your name I will be happy to try and locate one of your old files as the form should be in there.

Under Florida law, effective July 1, 2003, it is presumed that all licenses are operating as transaction brokers unless a single agent or no brokerage relationship is established, in writing, with the customer.

Be advised that although the disclosure notice provides for the customer's signature, the customer's signnature is not mandatory.

 

[mickeyfan0805]

That assumes that members only want to stay at the WDW locations.

What I would suggest is that the primary motivation for most DVC buyers is to be able to use them, at least sometimes, at WDW park locations. I know this is not the case for all of buyer and owners, but I believe that the number of DVC buyers wanting to stay at VB and HH for most of their travels is much smaller than those wanting to stay at DW and DL. With this in mind, I would think that the VB and HH contracts would go for less because the demand for them would be less in general. There are certainly some who will want it otherwise, but IMHO the demand for DW resorts will be much higher, and thus prices will remain higher for those resorts. It is not an issue of DVC members ONLY wanting to stay at WDW locations, it is an issue of DVC members wanting to stay at WDW locations more frequently than HH and VB.

 

[Dean]

There is nothing legally or ethically wrong with selling below market that I am aware of, esp with timeshares. If there were, I likely would only own one or two. But is is dumb to do so both for the seller and the agent as they are leaving money on the table since most brokers charge a % of the sale price. Having said that, many brokers are not well familiar with DVC (though that's changing) and may simply not know better. Or it could be that this is an attempt to sell really quickly and it will likely get ROFRed. It could even be set up this way on purpose. Hopefully the broker will tell the prospective buyer and have already informed the seller of the situation. It's also possible they plan to list low then tell the buyer about ROFR to try to get them to increase their bid. Lastly, it's possibly it's a scam though not likely.

 

[BWV Dreamin]

If you send me an e-mail with your name I will be happy to try and locate one of your old files as the form should be in there.

Under Florida law, effective July 1, 2003, it is presumed that all licenses are operating as transaction brokers unless a single agent or no brokerage relationship is established, in writing, with the customer.

Be advised that although the disclosure notice provides for the customer's signature, the customer's signnature is not mandatory.

Jason, sent you an e-mail. I have been very satisfied with TSS, and this discussion is not meant to find fault in the purchasing process. I truely do not recall any discussion of representation, but that doesn't mean I didn't sign a waiver, just not the form posted. I already knew the facts and terms that I wanted to utilize in my purchase, however others may not be as informed.Now the signature not being mandatory is new to me, and this is a big difference from the traditional "agency" representation. It is mandatory or the contract can not even be presented to the seller. Thanks for your discussion in this matter.