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Best place to take a loan from?
- Thread starter squidward
- Start date
stevehousse
Well-Known Member
Not trying to be rude but if u have to take out a loan for DVC, you probably shouldn't be buying into it in the first place...
Tom
Beta Return
I disagree. Everyone's situation is different. Now, if other debt is large, probably not best to add to the pile.
I used to say that as well, but time and circumstance has changed my view a bit.
-If you buy resale, you can get MUCH better rates than if you finance through Disney.
-We have no debt, other than our cars. No credit card debt at all.
-Technically, I could wipe my savings out and buy. I don't want to go that way. I'd rather take a loan for 3 years, and pay it back. God forbid something happens and I can no longer afford it, I simply sell it. I have yet to hear from any former DVC member that they had any difficulty at all in selling their contract.
GoofGoof
Premium Member
6% seems pretty good. It's basically considered an unsecured loan even if the points are put up as collateral since most banks consider timeshares risky. If you found one for 6% that's pretty good.
dreamfinder
Well-Known Member
Most timeshare loan rates I've seen are 9%+. So if you can find one for well less than that and are comfortable financing it, have at it.
HRHPrincessAriel
Well-Known Member
Not true at all.
Phonedave
Well-Known Member
Exactly - your payback period is going to be longer - but if you are OK with that, and you can manage your debt, then it is fine to do so.
-dave
I had a long conversation with someone at the Timeshare Store the other night. Obviously, they want you buying from them, but the woman I felt was spot on. Said she can't understand how anyone can purchase DVC through Disney anymore. Unless you're so desperate to own just a few points, owning the amount of points that many of us with kids would need for a good vacation is not realistic anymore. It's just gotten too expensive.
GoofGoof
Premium Member
As @Phonedave said, the time to hit your breakeven point is longer if you finance. Financing for 10 years at the direct from Disney rates (10%+) can push the breakeven point out pretty far. Renting points instead of buying can be a better financial option for some people, but renting points isn't as simple as booking with your own points. If you can get a 3-5 year loan at 6% interest then it's less of an issue than a 10 year loan at credit card rates. It's not a matter of being right or wrong, it's personal preference.
Another option is to consider buying less points. If you can save up to buy half as many points without financing that could be an option. With banking and borrowing you can use your points every other year and in the off year either rent points or book a cash room. Save up again and eventually buy the rest of the points if you are still interested.
Another option is to consider buying less points. If you can save up to buy half as many points without financing that could be an option. With banking and borrowing you can use your points every other year and in the off year either rent points or book a cash room. Save up again and eventually buy the rest of the points if you are still interested.
GoofGoof
Premium Member
There is no way to economically justify buying direct from Disney these days. The benefits don't justify the steep premium you have to pay.
draybook
Well-Known Member
slappy magoo
Well-Known Member
GoofGoof
Premium Member
That is exactly what I do. Every other year seems about right for us now. I usually do something non-Disney but this year in my off WDW year we did spend 3 nights at HHI DVC but we weren't using our points.
stichrules
Active Member
Another option is if you have a 401K to take a loan from it. When we bought ours we about 3/4 of the amount in savings and new we would have the rest in a short amount of time. So we borrowed from our 401K and it was only 3.25% and we only took it out for about 6-9 months. 401K loans have a very small interest rate for loans.
I was told we couldn't do that because only hardship loans could be taken from your 401K.