What Happens after being ROFR'd by Disney?

[bullpup12564]

The other day our broker told us that disney used the rofr to purchase the contract we were in the middle of purchasing. Will we get a letter from Disney for our records? or is it just the phone call?

He explained we could leave the deposit money in escrow or get it back. We made the decision to take out money back. Was there any advantage to leaving it in escrow?

We've been using the "constant scanning of the timeshare sites followed by phone calls to the various brokers" method. Is it better to stick with one? We don't want a big contract, but we're afraid that as non current DVC members every small contract will be ROFRd as they are supposed to be add-ons.

 

[Shawn]

If you were happy with the broker, and they move lots of DVC contracts, then it seems like it would be better to leave it in so you are ready to pounce on the next contract you like.

We bought our first contract this summer, a resale at VWL. We didn't want to worry about ROFR, so we scanned the threads here that list what is passing and what is being ROFR'd and made an offer based on that
information.

In our case, we offered $83 / point at VWL, which is what the seller was asking. It's true that we probably would have passed at $81 or $82, but if we went down to $80 or $79 or so, we felt it was too iffy. We bought a 100 point contract, so the difference between $80 and $83 was $8000 vs $8300. That is, we could have saved perhaps 300 dollars, but then we may have lost the contract to Disney. It seemed like it was worth the extra $300 to insure that the offer would pass.

In short, I think if you make your best offer your first offer, you should be able to pick up a small contract.

-Shawn

He explained we could leave the deposit money in escrow or get it back. We made the decision to take out money back. Was there any advantage to leaving it in escrow?

We've been using the "constant scanning of the timeshare sites followed by phone calls to the various brokers" method. Is it better to stick with one? We don't want a big contract, but we're afraid that as non current DVC members every small contract will be ROFRd as they are supposed to be add-ons.

 

[JABEAR]

If Disney exercises ROFR, is the seller obligated to go ahead and sell their contract at that price to Disney or can the seller decide not to continue with the transaction with Disney and then go back to the original seller and let them offer more in order to get the contract through ROFR at a higher price?

I agree with Shawn, do your research on what ROFR is "set" at currently and then make your first offer your best offer. The people at The Timeshare Store have a good idea on what will pass or not. You might want to check with them if you haven't already.

 

[highlander]

I've been through ROFR twice in about 45 days while attempting to pick up a contact at VWL through resale. What I don't understand is that if Disney isn't going to let contracts go through at prices under what they're selling SSR, then what is the benefit for anyone listing the contracts for the prices that they're currently asking? The first contract was for 300 points and I wasn't amused when the CM at DVC called to let me know that he just had points become available at VWL for $92 per point. That was the first contract that Disney bought out. The second was for less points and the same $ per point, but was also picked up by Disney. My feeling is that this will continue until I offer above what the sellers are asking for, or SSR sells out.

 

[bobbiwoz]

I've been through ROFR twice in about 45 days while attempting to pick up a contact at VWL through resale. What I don't understand is that if Disney isn't going to let contracts go through at prices under what they're selling SSR, then what is the benefit for anyone listing the contracts for the prices that they're currently asking? The first contract was for 300 points and I wasn't amused when the CM at DVC called to let me know that he just had points become available at VWL for $92 per point. That was the first contract that Disney bought out. The second was for less points and the same $ per point, but was also picked up by Disney. My feeling is that this will continue until I offer above what the sellers are asking for, or SSR sells out.

I don't see your name up on the ROFR thread. If you look at it, maybe you can "see" the price range that VWL are "going for" recently.

http://www.disboards.com/showthread.php?p=10585931#post10585931

I hope you get a contract!

Bobbi

 

[Shawn]

I think you should keep trying. Unless something has changed in the last few months, folks were picking up VWL contracts in the $80 to $83 range, and being ROFR'd below $80. Of course contracts with current year points and/or banked points on them are worth more, so take that into consideration. For example it should not have been a surprise that at $76 per point, Disney ROFR'd the100 point contract below which had 38 points available now and 100 points coming this december.

Here is the VWL data extracted from the "going for" thread which is referred to by bobbiwoz.

VWL Recent Passed Offers:
100 VWL (Jun) $82 (sub ???, passed 8/10?)
100 VWL (Jun) $83, 1 pt for 2005,
100 pts coming June '06 (sub ???, passed 8/26)
100 VWL (Mar) $80, no current pts, 85pts coming '06, buyer pays closing, splitting MN fees (sub 8/12, passed 8/29)
150 VWL $80, buyer pays MN fees from Aug forward (sub 8/17, passed 9/2?)

VWL Recent ROFR'd Offers: ---------------------------------------------------------

200 VWL (Mar) $77 (sub 6/8, ROFR'd 7/1)
60 VWL $79 (sub ?, ROFR'd end of July)
100 VWL (Dec) $76, 38 pts avail, 100 VWL pts coming Dec 05, buyer pays closing sellers pays MN on 62 pts (sub 7/18, ROFR'd 8/29?)
150 VWL (Jun) $78, 113 pts banked (ROFR'd 9/12)
25 VWL (Apr ) $76, no points until 2007 (sub 10/25, rofrd 11/11)

I've been through ROFR twice in about 45 days while attempting to pick up a contact at VWL through resale. What I don't understand is that if Disney isn't going to let contracts go through at prices under what they're selling SSR, then what is the benefit for anyone listing the contracts for the prices that they're currently asking? The first contract was for 300 points and I wasn't amused when the CM at DVC called to let me know that he just had points become available at VWL for $92 per point. That was the first contract that Disney bought out. The second was for less points and the same $ per point, but was also picked up by Disney. My feeling is that this will continue until I offer above what the sellers are asking for, or SSR sells out.

 

[lark]

I've been through ROFR twice in about 45 days while attempting to pick up a contact at VWL through resale. What I don't understand is that if Disney isn't going to let contracts go through at prices under what they're selling SSR, then what is the benefit for anyone listing the contracts for the prices that they're currently asking?

I guess from the seller's perspective, do they really care who ends up with the contract? If a seller needs to sell and is willing to sell at $x, and gets an offer for $x, the seller is happy. It doesn't matter to the seller whether it's your name or disney's signed on the check.

 

[calypso*a*go-go]

In addition to what lark just posted, you never know what the sellers circumstances are...they may be in the middle of a financial crisis and need to get the money from their contracts as soon as possible.

Your best bet is to do your homework and see what amount is currently passing ROFR at the resort you want to buy at. Many people think they can lowball a contract and really get a steal...w/ROFR that just doesn't happen and it really doesn't matter whether the contract is a FSBO or listed with a broker. Plus, remember that although it may be frustrating now, some day you may be very grateful that ROFR helps your contract hold it's value.

Good Luck!!!

 

[highlander]

My point was that I'm not clear why TTS would list a contract for VWL @ $79 per point when there is a pattern developing of it getting picked up by Disney. If the real going price per point is more than that, the seller should be made aware of this and list their contract at a realistic price. Why would they leave any money on the table? Plus, why would I offer more than the asking price if I was told that contracts have passed ROFR at $79 per point and less for VWL?

I wasn't looking to take advantage of anyone or low ball. I was attempting to buy through TTS and unfortunately it didn't work out for me at this time. That is ok with me and I'm glad that current owners are keeping their value. From my perspective, Disney has a great incentive to pull anything off the market that is below the current offering for SSR. If someone doesn't have any interest in that being their home resort, then they are forced to pay the higher price through DVC directly. I'm not interested in paying the inflated price, nor am I interested in SSR. My 5 vacations to Disney have all been at WL. I'll continue to stay at WL, it just won't be at VWL.

 

[bullpup12564]

The price I paid for the contract was what the TSS had listed. I did not go lower and it still was rofr'd. Maybe disney is cracking down on resales.

 

[DW_Fan]

Highlander, the reason sellers will sell for 79 a point is because someone is more likely to make an offer than if they list for 82 a point. Disney, on the other hand, is looking out for their owners (which is what they should do) by not letting contracts go through for $50 a point. If you did get that VWL contract at 79 a point, and a few years from now Disney stopped excercising it's ROFR, and sellers started selling at 50 a point, do you think you could get 70 a point if you needed to sell? So someone purchasing today knows that even if they purchase outright at 98/point, they can resell at 82/point or even more.

Also, for whoever asked, once an offer is made and signed by the seller, if Disney exercises it's ROFR, it's a done deal, as if Disney made the offer and the seller accepted.

 

[calypso*a*go-go]

I wasn't looking to take advantage of anyone or low ball.

Sorry highlander -- I honestly wasn't directing my comments towards you personally...it was just a general statement as we see so many posts from people asking for advice on how to get the best deal.

I know when I bought my resale I thought I was very savvy and looked only @ FSBO's thinking I could negotiate a much lower price without a broker's commission involved. I had no clue what ROFR was and how it worked. And yes, I was educated in a hurry when I found out Disney was going to buy back the contract I had worked so hard to find!

Now back to the original inquiry as to why someone would list their contract at an amount lower than what is considered the ROFR threshold...you need to keep in mind that some of these contracts were purchased years ago and the seller is still making a profit. Even if they list $1-$5 lower than the norm, depending on the number of points -- you're really only looking at a difference of a few hundred dollars.

Many people have used the heck out of their points and find themselves in a situation where they don't travel as frequently or maybe kids are no longer interested in "family" vacations. They really just want to sell the contract as quickly as possible before they lose unused points or have to pay another year of maintenance fees. Being ROFR'd is the quickest way to accomplish this.

Of course, that's just one of many theories!

 

[crisi]

And no one really knows what contracts will get picked up and which ones won't. Sometimes there are surprises - less than a few years ago, but still some surprises. So the reseller can't say "don't offer that, it will get picked up by Disney, because it might not."

The resellers have a tricky ethical line to walk. The get paid on commission, so its in their own best interests to have the contracts go for a lot. But they don't want to be accused of conflict of interest. They represent the seller, that's who pays them, but they want the buyers to be happy and get the contract, too. But no one is going to trust a reseller who says "pay $3 a point more so it goes through ROFR" and then someone else post that they bought a similar contract and paid $5 a point less.

 

[lark]

My point was that I'm not clear why TTS would list a contract for VWL @ $79 per point when there is a pattern developing of it getting picked up by Disney. If the real going price per point is more than that, the seller should be made aware of this and list their contract at a realistic price. Why would they leave any money on the table? Plus, why would I offer more than the asking price if I was told that contracts have passed ROFR at $79 per point and less for VWL?

I think the answer is that you can only sell if there's a willing buyer. If you can't sell at $83, or need the money quicker, or there is a surpuls of intenvetory at $83, or your MFs are coming due, then why not list at $79 if you're willing to take that? I don't really know what "the real going price" means. The "real going price" is whatever a buyer is willing to pay. On occassion and in the short term, the best willing buyer you might find might just be disney.

As for your question whether you would offer more than asking price, I guess I'm not sure why anyone would ever offer more than asking price for anything. If you're asking why you would ever offer more than what you believe the current likely ROFR price is, maybe you would maybe you wouldn't. The market works in reverse -- if demand is higher than supply, you might not be able to find a willing seller at the anticipated ROFR price.

 

[Shawn]

This is good information. I'm not sure why they would offer it at 79 since that is right on the ROFR borderline. I would guess that the broker would suggest to the seller that they raise it a few dollars, but if they seller really wants to offer it at 79, then that's what the broker will list it at (I think).

So, in that case, as a buyer, I would take into consideration the knowledge that contracts are being ROFR'd at that price, and I would offer a few dollars more than the asking price. The reason why is obvious, it has nothing to do with what the seller wants, but with getting past what Disney considers to be too low a price.

-Shawn

My point was that I'm not clear why TTS would list a contract for VWL @ $79 per point when there is a pattern developing of it getting picked up by Disney. If the real going price per point is more than that, the seller should be made aware of this and list their contract at a realistic price. Why would they leave any money on the table? Plus, why would I offer more than the asking price if I was told that contracts have passed ROFR at $79 per point and less for VWL?

 

[T.E. Yeary]

I'm going to comment on ROFR at the expense of sounding really DUMB!!!

In light of the recent SSR incentive, we do NOT know what the buy back prices are. We can only make an educated guess. As I said in an earlier post, if there ever was a time to try to slip one through ROFR, THIS IS IT!!!
Keep in mind, this board represents a very small percentage of the total packages we sell. For every ROFR you hear about, there are 10 that pass.

I personally think the buybacks are for packages that are already on the DVC waitlist. The reason I say this is there seems to be NO consistency to those that are ROFR'd since the new incentive. The prices are all over the board. It doesn't make sense, in my mind, for Disney to ROFR every contract out there because that would cut into their sales at SSR which is the real money maker for them. I feel they ROFR the ones they have orders for and sell for $92, a slam dunk for them. Quick, easy, DONE!!! If the folks on the waitlist get tired of waiting for their dream resort, what are they gonna do? They have 2 choices, they can buy a resale and if they're on the waitlist with Disney for the same thing, is it any surprise that they're ROFR'd and Disney suddenly has the same points to sell them at $92. Choice #2, they are going to buy SSR for the points, incentive, extra years, with the hopes of switching into their dream resort at 7 months.

I don't know if this is the answer folks. All any of us can do is speculate.

HAPPY "MAGICAL" VACATIONING,
Tom

 

[cgcruz]

There's no rhyme or reason for DVC to buy back. I just had a 25 point contract I was trying to purchase at OKW for $80 per point ROFR'd!

I think it pbbly comes down to what kind of waitlist disney has for sold out properties for their current members.

 

[T.E. Yeary]

Did I mention the wait list??????

 

[CarolA]

Well, to defend the broker...

I will probably be calling one of Tom's sales reps to list a 100 pointer soon. I know what price I want to list it at... I don't really care who winds up owning it, Disney or the buyer. I have been monitoring and I know where things are selling and that is what is important to the seller. The broker can't "make me" list it for more LOL!

 

[highlander]

Let me take another swing at this to see if it makes sense. I'm very happy with the service that I got from Jason at TSS and wish that I could get a contract for VWL. But I'm not ready to spend $92 per point through DVC.

Here is my point. If Disney has a waiting list of buyers interested in VWL @ $92 per point, and you own points that you paid, say, $70 for, then why wouldn't you try to sell them through resale for maybe $85 per point plus closing? Putting aside situations where someone needs to get out from a contract in a hurry, why would you let Disney make an extra $6 per point by listing your contract for $79? How does that benefit the seller or TSS? So if recent sales have been going higher, why wouldn't someone test the market instead of giving away extra dollars? Isn't one of the benefits of ownership the fact that your investment is somewhat protected by ROFR? That said, resales for hot properties should maybe be listed for the current SSR price per point as then a buyer really has 2 options.