Trading a contract

[Mhahnster]

Hypothetical situation here. If I found another Dvc member that had a contract that matched what I need uy/size and I had one that matched theirs, could we trade ownership through a resales agent? Would we have to sell/go through rofr with each other?

 

[disneynutz]

You would have to sell to each other and go through ROFR.

Bill

 

[agie65]

You would have to sell to each other and go through ROFR.

Bill

I agree.

You can try high prices to avoid getting ROFRed.

 

[CarolMN]

.......You can try high prices to avoid getting ROFRed.

If the contract sent to ROFR does not reflect what the parties actually pay, it is fraudulent - both parties would be subject to prosecution.

 

[lovin'fl]

Could you gift the contracts to one another? If you gift a contract I do not think it has to go through ROFR, right?

 

[chalee94]

Could you gift the contracts to one another? If you gift a contract I do not think it has to go through ROFR, right?

are you "really" giving a gift or is it contractual? i still think you are suggesting fraud, which is asking for trouble.

 

[Noelle]

Could you gift the contracts to one another? If you gift a contract I do not think it has to go through ROFR, right?

Yes, you can gift it. But then you have tax ramifications as there is a limit to how much you can gift someone before you have to pay taxes on that gift. And there is a lifetime limit on giving to one individual. The gift can't be under valued or it would pose a red flag for an audit. But you could legitimately gift your contract at market value and claim that gift on your income taxes when you file. Plus then you would pay any required taxes pending the amount of the gift and how much you can give someone in their lifetime. I'm not an attorney or an accountant and anyone thinking about gifting their contract should contact the appropriate professional to assist them in determining how it would affect them. But it can be done.

Edited to add: I didn't want to imply that it was a good idea for two people to gift each other their contracts in trade...That's a lot more work, headache, and money...You really wouldn't be saving anything after the taxes and hiring an attorney and / or accountant. But just wanted to say that you can gift a contract.

 

[disneynutz]

If gifting cuts Disney out of ROFR, I am sure that the DVC legal people will be reviewing the transaction.

You don't take money from the mouse!

Bill

 

[Noelle]

If gifting cuts Disney out of ROFR, I am sure that the DVC legal people will be reviewing the transaction.

You don't take money from the mouse!

Bill

That on top of Uncle Sam!!! But gifting a contract is legitimate...Eventually, we'll probably gift a couple of our contracts to our kids when we get into our 70s and don't need as many points. - That's if they want them.

 

[lovin'fl]

If gifting cuts Disney out of ROFR, I am sure that the DVC legal people will be reviewing the transaction.

You don't take money from the mouse!

Bill

I am pretty sure we are allowed to gift our contracts...not that I want to but I could gift my OKW to SIL who is also a DVC member and why then could she not gift her SSR or AKV to me? I guess where it would be a problem is if the 2 contracts aren't an equal value but what if my 200 OKW were gifted for someone else's 130 BLT...might be kinda even trade no?

And about taxes with a gift. My state it's $15K I think that can be gifted tax free. So my 200 OKW is valued under that and can be gifted tax free...I think. I am no expert and I am not in the market to trade or cheat the mouse. ..just think this thread is intetesting.

 

[lovin'fl]

That on top of Uncle Sam!!! But gifting a contract is legitimate...Eventually, we'll probably gift a couple of our contracts to our kids when we get into our 70s and don't need as many points. - That's if they want them.

We plan that too...but I keep adding and making the number not easily divisible by 3...guess I need more...lol.

 

[Noelle]

We plan that too...but I keep adding and making the number not easily divisible by 3...guess I need more...lol.

Careful talking like that...Aren't we both supposed to be 'nearly done'?
I almost caved yesterday when I saw those Vero Beach points with subsidized dues.
And I am having a heck of time not calling my guide and putting myself back on the BWV wait list.

 

[chalee94]

family is a different issue, and not what the OP is talking about.

when dealing with a third party, the question is: are you giving them the contract as a gift with no strings attached or giving them the contract in consideration for her "gifting" you with an AKV contract? how is that any different in principle than gifting someone with an OKW contract in consideration for them gifting you with cash?

a "gift" that has strings attached is likely a violation of the law, if disney decides to pursue it.

 

[lovin'fl]

Careful talking like that...Aren't we both supposed to be 'nearly done'?
I almost caved yesterday when I saw those Vero Beach points with subsidized dues.
And I am having a heck of time not calling my guide and putting myself back on the BWV wait list.

Lol...I know. Now I keep thinking that my new 25 BWV Aug UY is too small (even though we have 55 BWV in our June UY) and we need to add to them....and I won't look at the resale sites anymore...need to get to 2015 without adding anymore.

 

[disneynutz]

family is a different issue, and not what the OP is talking about.

when dealing with a third party, the question is: are you giving them the contract as a gift with no strings attached or giving them the contract in consideration for her "gifting" you with an AKV contract? how is that any different in principle than gifting someone with an OKW contract in consideration for them gifting you with cash?

a "gift" that has strings attached is likely a violation of the law, if disney decides to pursue it.

I'm sure Disney has a process for gifting contracts and don't forget, they will still need a contract or other legal document, filings with the county, and they will be the one adding the contracts to accounts. I guess that they could also notify the IRS if they wanted to, this would be a real estate transaction and we have the new patriot laws to deal with.

Bill

 

[Mhahnster]

Ok. Thanks for the healthy discussion. The spirit of my original question was whether or not two sellers could be traders with one another to find a resort/uy they both like. The more I think of this it could be an unbalanced trade depending upon resorts, meaning one side may need to pay more to the other.

I think Bill nailed what I expected - we would have to "sell" to one another and exchange money, while going through an agent to help with the paperwork and closing. Another salient point raised was to ensure the pricing avoids RofR.

There is a level of complexity but it sounds like it could be done if worked out properly - possibly allowing for a double closing to be done at reduced fees (I have nothing to base this on.)

That being said - anyone want to trade for a 150/HHI/June? J/k

 

[Dean]

Ok. Thanks for the healthy discussion. The spirit of my original question was whether or not two sellers could be traders with one another to find a resort/uy they both like. The more I think of this it could be an unbalanced trade depending upon resorts, meaning one side may need to pay more to the other.

I think Bill nailed what I expected - we would have to "sell" to one another and exchange money, while going through an agent to help with the paperwork and closing. Another salient point raised was to ensure the pricing avoids RofR.

There is a level of complexity but it sounds like it could be done if worked out properly - possibly allowing for a double closing to be done at reduced fees (I have nothing to base this on.)

That being said - anyone want to trade for a 150/HHI/June? J/k

This has been asked fairly often but it rarely works out to be useful. Getting 2 sides together that have what the other wants is unusual and it's common that one party or the other believes their portion to be worth more than the other. Working out the technical details and adjusting for UY, number of points and points availability is actually the easy part. I have done this by trading a non DVC timeshare for DVC points and DVC forced us to put a monetary value on the DVC component. It wasn't difficult for our situation because the real values were almost identical. I must admit I was tempted to not put a value and try to force their hand but I wanted the DVC contract and didn't want to chance losing it by monkeying around. While it's easy to commit fraud in such situations, valuing each side isn't likely to be one of them in such a trade unless one exceeds the retail prices.