Tips/Math on evaluation of a resale...

[jaysue]

Crossing my fingers, if all goes decent with the annual bonus this year, we will be looking seriously at an add-on at OKW and/or VB through resale (or new at SSR but that part easier to figure out). Need some help from the resale pros here as to what are the key points to watch out for and how to best financially evaluate an offer....

thanks
jaysue

 

[Happy Birthday Cat]

When I bought my resale, I waited and waited for the right property. I wanted a certain use year, I wanted banked points, I wanted a certain number of points and I wanted to pay close to what ROFR was at the time (Dean helped a lot with this point especially).

It finally came through and I was able to get something that not only had all of the current year's points in tact, but it also had all of the points from the year before banked into the current year too.

Patience when it comes to a resale is a virtue. Wait for what you want. Let the resale companies know in advance what you want as well. They may call you before the property ever hits the market.

HBC

 

[JimC]

What I do is look at the cost per point for the number of points I am purchasing over the remaining term of the contract. That includes adjustments for banked, borrowed and current year points. Then I look for the resort and contract size range I am interested in. I compare those asking prices, analyzed as I explained above, to buying from Disney direct (waitlist at the sold out resorts). I include esitmated closing costs for the resales at $2.00 per point for the size range (300 to 400 points) I am interested in. Ask the broker what to estimate for whatever range you are considering. No closing costs for Disney direct.

Find a good broker -- I used Pat Spell at the Timeshare Store and would use her again. Very professional, efficient and knows the DVC. Tell the broker what you want. Some of the best deals don't make it to the internet listins.

Then I pick the best deal at the asking price and make an offer. From here on out it is just like any real estate negoitation. You can negoitate closing costs, maintenance fees and price.

There are several thoughts on maintenace fees. 1. Prorate based on closing for the calendar year in which you purchase -- consistent with how the fees can be paid to DVC. 2. Prorate for the remaining points on the contract for the current use year -- consistent with running the fees with the points. 3. Have the seller pay all fees in the current year -- consistent with the fees as a sunk cost. 4. If you buy a stripped contract you may get, but it may be difficult, them to pay the fees for the next year as well -- consistent with #2 above.

On the offer make sure that whatever terms you want are specified, including how maintenance fees are being handled. Also ask that the total remaining points you are purchasing be stipulated. If its 38 years on a 300 point contract with no current year points and 250 points borrowed, then you are buying 10,850 points.

If you want you can send me your email and I will email you the spreadsheet I use to compare the different contracts. Good luck!