Why the 8-month Restriction on Banking

[Family-of-4]

Why can't you bank up until the end of the use year? Seems to be an unfair restriction. I read on the boards today that the restriction use to be only 10 months. Will Disney further restrict this in the future?

 

[browniemtb]

Why can't you bank up until the end of the use year? Seems to be an unfair restriction. I read on the boards today that the restriction use to be only 10 months. Will Disney further restrict this in the future?

At 10 month you were only allowed to bank a certain percentage of points not the full amount. Actually I think, and some will disagree, that this works better. There is a longer period of time to bank 100% of your points then you did before rather then having the ability to bank 100%, 50%, 25% as you got closer to the end of your UY. Its all in the way you look at it.......

 

[Family-of-4]

At 10 month you were only allowed to bank a certain percentage of points not the full amount. Actually I think, and some will disagree, that this works better. There is a longer period of time to bank 100% of your points then you did before rather then having the ability to bank 100%, 50%, 25% as you got closer to the end of your UY. Its all in the way you look at it.......

Thanks, but why the restriction at all? Why can't 100% of current use year points be banked up until the end of the use year?

 

[browniemtb]

Well that question would be best answered by Disney themselves. But I would assume it forces the owner to commit one way or another 4 months prior to a new allotment of points. I would love to be able to bank right up until the last day. I'm curious to see how others may answer this question since I really didn't answer it, I have no answer......

 

[DebbieB]

There is a clause in the contract that DVC can suspend banking and borrowing if they feel there is an imbalance of points in the system. I think the 8 month rule gives them time to assess.

 

[Family-of-4]

There is a clause in the contract that DVC can suspend banking and borrowing if they feel there is an imbalance of points in the system. I think the 8 month rule gives them time to assess.

Why do they care if there's an imbalance? Is it to try to keep a uniform use of the villas to keep a constant supply of folks at the parks, using the restaurants, buying souvenirs, etc?

 

[btrim]

if everyone waited until the last minute to bank and if they chose to do so, it would be like over selling the resorts. You would have too many people with too many points and not enough rooms if everyone chose to use them at the same time. If you have ever dealt with another timeshare company, you would find out that they have restriction on banking also. Most of them won't let you bank after a certain period of time. If they do, they put restrictions on your unit such as you can only use it a certain week and you can only make your reservations so many days in advance. It is just the way the system works. I don't believe it is Disney trying to make sure the parks are full, etc.

 

[DebbieB]

Why do they care if there's an imbalance? Is it to try to keep a uniform use of the villas to keep a constant supply of folks at the parks, using the restaurants, buying souvenirs, etc?

I could see a situation (like now) when there is a downturn in the economy and people start banking points because they can't afford to go. Then the economy is getting better and people want to go again, you have alot of people not being able to get reservations and losing their points. The system works best if everyone has the opportunity to use their points each year. Alot of people being shutout would not be good. I could also see a situation right before the contracts start expiring that people will start borrowing. As far as I know, they have never implemented this but it's there if they want to.

 

[disneynutz]

Thanks, but why the restriction at all? Why can't 100% of current use year points be banked up until the end of the use year?

You know the answer, just say it.

Disney designs the system to their advantage. Thousands of DVC points, just like thousands of DDP credits are forfeited yearly. Pure profit for Disney.

 

[Pennyguy23]

Disney is smart and if they are doing it for profit. Thats fine with me. That means new rides, renovations, more cast member etc etc. I for one and glad they even have DVC other wise I wouldn't be able to afford the vacations I go on every year. So what ever they have to do to keep the ball rolling as long as they don't mess with the rule to much.

 

[WilsonFlyer]

Maybe what I'm thinking is so obvious to me that it's not the reason.

It seems to me that the banking deadlines are in place in order to lock the points up as early as possible so Disney can release those points, and hence those rooms, to CRO and other early promotions. With the inability of members to reverse their decision, this assures disney of "free money" for CROs at the resorts from which the points are released. I would like free money. I bet disney does too.

Did I miss something?

 

[bicker]

Indeed. People trying to find some nefarious intent here are off-base. If too many points are banked, then the next year there will not be enough points inventory for everyone. That doesn't hurt Disney -- it hurts us, the members. The restriction is there to protect us, not Disney.

 

[RobDoc]

...
It seems to me that the banking deadlines are in place in order to lock the points up as early as possible so Disney can release those points, and hence those rooms, to CRO and other early promotions. With the inability of members to reverse their decision, this assures disney of "free money" for CROs at the resorts from which the points are released. I would like free money. I bet disney does too.

Did I miss something?

During the last 60 days before any given date, any unreserved DVC villas are turned over to CRO for cash rental. The income from any subsequent rentals is "Breakage Income" and is used to offset our dues. It appears as a line item under "Income" in the dues statement each year.

With traditional timshares, it's always a use-it-or-lose-it scenario. If I own week 10 at a resort, my options are to either use the time myself in some fashion (personal use, rental or exchange) or I will lose it since there is no way to bank that week (or borrow the following year). Most all points based systems do have some sort of deadline - some allow banking, some do not, some allow borrowing, some do not.

The original banking deadlines allowed up to 100% to be banked within the first 6 months of the Use Year, up to 50 % to be banked thru the ninth month and up to 25% thru month 10. No points could be banked during the last 2 months of our Use Year.

I agree that there is no profit motive on the part of DVC for the banking policy - it is used as a planning tool. Thus far, DVC has never suspended banking or borrowing - but they could at any time. In a perfect system the total number of current, banked and borrowed points for each year would exactly equal the number of points in the system for a single year. Certainly the non-DVC options where inventory is rented by CRO does create a challenge to keep everything in balance.

Some members, in any timeshare system, will end up losing each year. Either their unit will sit empty for their week, or they will forfeit weeks/points spacebanked into II or RCI or their own system.

The flexibility offered by allowing banking and borrowing comes with some restrictions and banking deadlines are the result of that flexibility.

 

[Claire L]

Maybe what I'm thinking is so obvious to me that it's not the reason.

It seems to me that the banking deadlines are in place in order to lock the points up as early as possible so Disney can release those points, and hence those rooms, to CRO and other early promotions. With the inability of members to reverse their decision, this assures disney of "free money" for CROs at the resorts from which the points are released. I would like free money. I bet disney does too.

Did I miss something?

But after you have banked there is still the opportunity to borrow back from the following year. So Disney really aren't guarenteed anything even after you bank as you can borrow!

Claire

 

[WilsonFlyer]

But after you have banked there is still the opportunity to borrow back from the following year. So Disney really aren't guarenteed anything even after you bank as you can borrow!

Claire

Hmmm... Good point. I hadn't thought about that.

 

[Family-of-4]

But after you have banked there is still the opportunity to borrow back from the following year. So Disney really aren't guarenteed anything even after you bank as you can borrow!

Claire

Is there a deadline for borrowing from the next year?

 

[Claire L]

Is there a deadline for borrowing from the next year?

Nope as long as it is for a reservation within the previous UY. Although once borrowed they cannot go back to their original UY.

Claire

 

[RobDoc]

Is there a deadline for borrowing from the next year?

No - there is no deadline for borrowing at this time. You can borrow only to make a reservation.

 

[drusba]

My guess is that the 8 month banking rule is mainly a randomly chosen deadline. Before the 8 month rule, it was 6 months to bank all points, 9 months for 50% and 10 months for 25%. They could just as easily have chosen, when they changed, to allow banking of all points at any time before end of 10th month and thus even the 12th.

At the same time they adopted the 8 month rule, they also adopted the rule that during the last 4 months of your use year you cannot call and reserve a Disney hotel for a time during those last 4 months. in other words, to do such a trade out for a stay during the last four months of your use year, you need to call by the end of the 8th month of your use to make the reservation. Thus, each member is placed in a position that he should make some decision about remaining points at the end of the eighth month -- decide to use them for a DVC resort or trade out to a Disney hotel, or bank them. But choosing the 8th month barrier probably happended because someone in DVD management liked the number 8 or you had a committee where some were suggesting 10th month, others 6th and they compromised at 8 months.

 

[dallastxcpa]

Well, there has rarely been a year when we weren't in point debt. So I have hardly ever had to worry about banking deadlines.

Now, yes I know that means I need more points. And I fully intend to add on sometime in the near future, but for now I am very glad to not have to worry about banking deadlines.