Trying to get a loan for DVC ...help

[goofygal1975]

We have been approved through Disney for our DVC purchase.(we are buying BLT directly from Disney)..we have the contracts signed and ready to go...but we are hoping to get a local loan for a much lower interest rate! The guy at the bank FINALLY called me back after 2 days, and says he doesn't think he can do a loan for us since it is like a "timeshare" adn other people can be in our room at any given time, and that we have to call to make a reservation to go there. He acted as if I was wasting his time, and was kind of a jerk. (Our local bank branch does not have a mortage person, so we are dealing with another branch).

I finally kept asking him, well how can we actually find out if you can do this or not? Finally he said he would talk to someone at Disney. I gave him my guides #, and also called my guide to give him a heads up about the call.

Anyone else gone through a bank for a mortage loan and had any issues buying into DVC?? How did you ask for it, what magic words were used?

 

[Ed T]

What about an equity line? some of those have very low interest rates right now. They are based on the prime rate + or - a %. The one I had gotten about a year ago for a second home purchase is prime less .50% or 3.8% right now. Of course as the prime moves up or down so doesn't your rate. question is will it ever get to the 10.50% disney is giving?

 

[Dodie]

I've never heard of anyone financing DVC with an actual mortgage, unless they go Disney direct. I've only heard of people getting a home equity loan to do it.

That doesn't mean it hasn't happened. I'm just not surprised that your bank isn't excited about looking into it this way.

 

[MinnieVanMom]

I know this opens an entirely different can of worms but here is what I think. Again, we all have opinions and that is fine.

To me, a DVC is a luxury item. Not a need but a want. Again, for me, I would only purchase a DVC if I had the rest of my affairs in order. That being not having to take out a loan.

Sorry, JMO.

 

[spiceycat]

no banks gives a mortgate on timeshares.

you must go thru DVC - or get an equity loan on your house.

 

[KAT4DISNEY]

Strange that he did not mention a home equity loan - but that would be the only way to finance thru a local bank. It's just impossible for a local bank to be able to foreclose on a timeshare if there ever was a default. However that is possible for disney to do. Not saying your going to default - that's just why it wouldn't be done.

 

[LisaS]

I can't see a bank giving you a mortgage loan to purchase DVC. You are purchasing a timeshare so you are not the sole owner of the Unit. As others have posted some members have used a home equity loan to finance their purchase. Only Disney will give you a mortgage on your purchase, presumably because they collect the taxes and insurance premiums from you (via the annual dues) and have the power to take back your contract if you fail to pay either your dues or your loan payments.

 

[goofygal1975]

Thanks everyone...you learn something new everyday!! we'll go through Disney for now, and work on something later! My guide did call me back and explain everythingI had just read on here before he called me. It's good to see everyone on the same page.

As far as being able to pay for it outright...we'll, we'd love to do that...but it's not in the cards for us right now. However, all our other credit is paid off and this will be the only thing we are paying on. Our house is paid off and this is definatly something we can handle...we go to WDW every year, so why should we wait until we have all the cash saved up. We'll be enjoying our vacation and paying off our DVC loan at the same time!!

 

[Cmbar]

Thanks everyone...you learn something new everyday!! we'll go through Disney for now, and work on something later! My guide did call me back and explain everythingI had just read on here before he called me. It's good to see everyone on the same page.

As far as being able to pay for it outright...we'll, we'd love to do that...but it's not in the cards for us right now. However, all our other credit is paid off and this will be the only thing we are paying on. Our house is paid off and this is definatly something we can handle...we go to WDW every year, so why should we wait until we have all the cash saved up. We'll be enjoying our vacation and paying off our DVC loan at the same time!!

Good for you! I think a line of credit against your house already paid off may be a cheaper way to go if you want to go that route. You obviously have equity if you are lucky enough to have your house paid off! Most likely the interest is tax deductible (although I think it may be through Disney as well).

I say go for it and enjoy!! And I don't agree that DVC is purely a luxury. We can say that about anything. A house is a luxury if you want 5 bedrooms instead of 3 , a new car is a luxury if you can buy a used one instead, private education for you children instead of public school .... I probably wouldn't put myself in major debt for a Disney Timeshare, but I don't see how it isn't somewhat a necessity! At least for us!! I may clear go crazy if I can't get out of this ice and snow soon!!

 

[CarolA]

I have never heard of anyone getting a mortgage loan for a DVC timeshare. I don't think it's going to work in this environment. You MIGHT get a Home Equity, but those are pretty tough right now too.

 

[goofygal1975]

Good for you! I think a line of credit against your house already paid off may be a cheaper way to go if you want to go that route. You obviously have equity if you are lucky enough to have your house paid off! Most likely the interest is tax deductible (although I think it may be through Disney as well).

I say go for it and enjoy!! And I don't agree that DVC is purely a luxury. We can say that about anything. A house is a luxury if you want 5 bedrooms instead of 3 , a new car is a luxury if you can buy a used one instead, private education for you children instead of public school .... I probably wouldn't put myself in major debt for a Disney Timeshare, but I don't see how it isn't somewhat a necessity! At least for us!! I may clear go crazy if I can't get out of this ice and snow soon!!

I agree Disney is a must for us! It is our happy place and we look forward to many many years of enjoying our DVC purchase!!! No matter how or when we pay it off!!

 

[MILLZ]

buy it however you want and please enjoy it... be careful on here many people want to impress there opinions upon you...this is one of the reasons i do not frequent these boards any longer so i implore you to just enjoy your dvc contract... I financed mine for about 5 mths until i could get things in order but if i had to keep the loan for longer i woud have...lets not forget your making an investment in your family...please enjoy

 

[goofygal1975]

buy it however you want and please enjoy it... be careful on here many people want to impress there opinions upon you...this is one of the reasons i do not frequent these boards any longer so i implore you to just enjoy your dvc contract... I financed mine for about 5 mths until i could get things in order but if i had to keep the loan for longer i woud have...lets not forget your making an investment in your family...please enjoy

Thank you! That is how I feel as well! I'm glad some people can pay it off outright. But I'm also glad there is financing so that everyone can enjoy Disney the way they please! I know we are so excited to be able to buy into DVC and continue our Disney Trips!!

 

[jodifla]

Thanks everyone...you learn something new everyday!! we'll go through Disney for now, and work on something later! My guide did call me back and explain everythingI had just read on here before he called me. It's good to see everyone on the same page.

As far as being able to pay for it outright...we'll, we'd love to do that...but it's not in the cards for us right now. However, all our other credit is paid off and this will be the only thing we are paying on. Our house is paid off and this is definatly something we can handle...we go to WDW every year, so why should we wait until we have all the cash saved up. We'll be enjoying our vacation and paying off our DVC loan at the same time!!

We financed ours as well... and we've had it paid off for years, and we've enjoyed 12 YEARS OF GREAT VACATIONS instead of trying to save up the cash, only to have the points keep skyrocketing in cost.

We viewed it the same as you...we were already spending money at WDW, so we just spent the money we'd spend toward our DVC.

I believe financing one luxury at a time isn't a big deal if you have the rest of your affairs in order.

Let us know when we can say WELCOME HOME!

 

[Disney Todd]

You know what they say; if you can't pay cash, you can't afford it. Our nation is in real trouble due to leveraged purchases of depreciating assets. I would strongly counsel against financing a timeshare, IMHO. If you need to sell next year after having bought through Disney for say $105/pt, you'll be lucky to sell for $80/pt on resale then walk with $72/pt after commission. You would be significantly under water unless you put at least 30% down.

 

[eileenkeeney]

You know what they say; if you can't pay cash, you can't afford it. Our nation is in real trouble due to leveraged purchases of depreciating assets. I would strongly counsel against financing a timeshare, IMHO. If you need to sell next year after having bought through Disney for say $105/pt, you'll be lucky to sell for $80/pt on resale then walk with $72/pt after commission. You would be significantly under water unless you put at least 30% down.

Is borrowing for this sort of thing, and having one's house paid off; any different then paying cash for this sort of thing, while one's house is not paid off (instead of just putting all of that cash toward the mortgage).

I paid for my DVC with cash.
But at the time, my mortgage was not paid off (it is now).
My job seemed very secure at that time in my life (it doesn't feel so secure any more).
Was it irresponsible for me to by DVC instead of putting the same money toward my mortgage, at the time?

 

[logan115]

Think that the point people are trying to make is to make sure that you're financially able to pay for DVC (whether outright or financed).

Personally if I buy DVC I could pay cash, but would prefer to finance a portion (probably around 80%) and keep the rest in the bank. Yes it's silly to pay 10% interest, however for me I don't mind paying 10% knowing that I have cash in the bank (helps me sleep at night). Sometimes you can't always go strictly by the numbers.

Financing is not always a bad thing, while it's great that so many have been able to pay it off at the time of purchase, the fact that I may not isn't going to discourage me too much either. I didn't wait until I had enough money to pay for a house outright to buy, and I also financed both cars that we have.

Agree 100% with those that say DVC is a luxury item (and therefore different from financing a house/car that you need), however it is your personal financial situation determines whether or not you can afford it (either all up front or making payments).

If you have the cash and want to pay it off, then go for it. If you want to finance it and are at least 90% sure that you'll have no problem making a payment of a couple hundred bucks each month for a few years, don't be discouraged if you need to do that.

Whether you pay cash or finance, if your financial situation changes and you have to sell, you can - but be prepared to take a loss and factor that into the equation (ie if I buy now, and have to sell 6 months-1 year down the road can I come up with a few grand to "get me out.") Kind of like being upside-down on a car loan or mortage.

Good luck either way - and remember that people here have different views on everything - THIS IS A GREAT THING [/U ]- as it gives you a chance to see both sides of situation.

Sometimes hearing something that we don't really want to hear stinks, but I'd rather hear it and make a more informed decision, than bury my head in the sand and regret it later.

Chris

 

[spiceycat]

also finance - you will be fine.

have the money in my 401-k and not touching it. did before and that loan hurt my 401-K - the company changed the rules after took the loan.

so now not touching that money period - okay if I got lay off might. but anything else no.

you can write out the interest on your taxes - just like you did with your house.

worst with my home (condo) - get if almost pay off then take out a refinanced loan. part of that is the refinance company - they want more than what I needed - but still could have put the rest in saving -did not need to spend it.

 

[Brian Noble]

Our house is paid off and this is definatly something we can handle.

Ordinarily, I think it is unwise to finance a DVC purchase. But, if your home is fully paid off, the situation is a bit different, and you absolutely should look into a home equity line to see if you'll have a lower interest rate.

There's no reason to spend more money on this than you have to.

 

[JW9DVC]

It's your money. Do what you want!!

If you could afford to finance, go ahead. Place it on a credit card if you have a lower interest rate and and high limit.

People on here, believe you should pay cash. Maybe they don't believe in credit. Some of those are not able to afford it in the first place, maybe because they have bad credit and couldn't get a loan.

Finance, finance, finance because you are lucky enough that you can. You want to, its your decision. JW