Transfer or Add On?

[shellbelle1971]

We have good friends who want to go with us to WDW in the fall of 2008. They don't care which resort they stay at, and are willing to pay the cost of point rental for their accommodations. They prefer that I just book their ressie for them, and then they'll give me a check for "whatever I think is fair." (We've already talked several times about the going rate for point rental and about how many points their stay would require.)

We would be short about 300 points to book a unit for them. We're considering whether we should:

1. Rent points from another member. In other words, transfer in enough points for their ressie. Or...

2. Use the $ they are willing to pay for their stay towards purchasing a small add on (like maybe 100 points) and use banking & borrowing with the new points to make their ressie.

FWIW these friends wouln't care which option we used.

We would like a few more points, and this might be a good way to do it. But I'm not sure we would need/want that many more points all the way until 2042 or 2054!

Help me think this through. What are the issues? What would you do?

 

[Happy Birthday Cat]

We would like a few more points, and this might be a good way to do it. But I'm not sure we would need/want that many more points all the way until 2042 or 2054!

I wouldn't base a $10,000.00 investment on the one time point use of friends. Will you use those points in the future?

If I thought that we would use the points every year, there is no doubt I would do the add on. But since you aren't sure if you need that many, that's the question you need to answer for yourself. If you only bought those 100 points for that trip, then it wouldn't be worth it.

Of course there is always the option of a smaller add on and a smaller rental if you aren't comfortable with a 100 point add on but still want to do an add on.

Good luck.

HBC

 

[Boas]

consider the advice of Happy Cat... buy what you really want (25, 50, 75, 100 pnts), then bank, borrow, etc... and rent the difference.

Rough math (you need to do your own):
Annual Dues: approx: $2.25 x 100 = additional $425/ yr (x 37 years = $16k)
Initial Purch: $9 x 100 = $9k
TOTAL = $25k. (all the usually disclaimers for time value, inflation, etc.)

Your friend is giving you $3k.... your balance = $22k.

 

[shellbelle1971]

I have no doubt that we could easily use an extra 100 points per year. But we don't really NEED them. (Not that anyone NEEDS dvc...food, shelter, love, those are needs...everything else is a want...)

But we find ourselves booking smaller units than we would like, and not taking trips that we would like to take because we're "out" of points. But $8k (approx. $ cost for what we would need) seems like a lot of $ to spend on what would, essentially, be an upgrade to something we already have.

The idea of applying $2700 to that (from renting the points to our friends) and only having a $5-$6k up-front, out of pocket is very attractive to me!

I also like the idea of buying some points at OKW (we currently don't own there) so we could book their grand villas sometimes. (So far no luck with the wait list.)

But I still hesitate, thinking...ahh, but we don't really *need* it, and someday in the future (admittedly, the far future, since we will have either a baby or grandbaby around for a very long time) it might become burdensome.

 

[utahkennedys]

I just went through this same dilemma b/c on our last trip with my parents we added 55 points ($550) and then I just added 30 for our next trip ($315), and may need to add more if we decide on a 2BR instead of a 1BR....

So, anyhow, I chose to hold off on the add-on for now because if I bought 30 points it would come to $2760, plus the maintenance fees of like $120/year or so. So, if I transfer points every 2 years or so for $300, I figure it is about the same cost as my maintenance fees would be.

It was kind of a toss-up for me. If DH was more into DVC we would have added on right now, but he isn't quite "sold" yet...

 

[shellbelle1971]

Kennedys,
This is exactly the kind of scenario we're often looking at. And you're probably right, renting (at least right now) probably is a better deal than buying.

OTOH, who wouldn't to have more points? Especially when I find myself frustrated about every third trip when we really want a GV at OKW and are unable to book it because we don't have the 11 month window there...so we find ourselves (just us & kids) in a two bedroom, and grandma & grandpa either not coming with us, or way on the other side of the resort in a studio. It would just be so nice to be able to get a GV sometimes!

Oh well. I've never been the one with the spreadsheets out. That's DH's dept, and he's very good at it, so he wouldn't let us add on until and unless it actually made sense for us to do so. Which, sadly for me, doesn't look like right now...

 

[rantnnravin]

you could always buy the add-on, use the 3 years worth of points for your friends, then sell the contract...

 

[shellbelle1971]

Ooooh, rantn...I that idea! We could buy the add-on, *planning* to sell it in a few years. And if we happened to decide after a few years that we really, truly do *need* to keep it...well...things change, no? Of course if we still *needed* it we could keep it

 

[lizziepooh]

Fall of 2008 is more than 2 years away. Circumstances could change and your friends could change their minds between now and then. Personally, I would base a purchase on your needs, not on your friends potential rental plans.

 

[shellbelle1971]

It's true circumstances can and do change over time. But these friends have also been business associates for nearly 15 years, and I have had enough interactions with them to know that if they make a committment they will keep it. The only think that would keep them from it would be a dramatic disaster...and in that event, I'd do anything possible to help them out. $3k is a small sum relative to the total $ amounts in our transactions with them over previous years.

FWIW, when dealing with friends, family, and business, we always look at a transaction from our end with the thought: "When we do this, how would we feel if Person X never paid us anything?" If that would cause damage to the relationship, we won't do it. So far, most friends and family members have honored their commitments, and the couple that haven't we understand why.

On the flip side, when, because of unusual circumstances, we have needed to borrow from a friend or family member, we have always made it a point to use a written agreement and pay it off as soon as possible--always far ahead of schedule.