Purchasing Use Year Past Banking Deadline

[BlackCauldron]

I'm trying to get a clear answer from the DVC sales folks on this, but no one can seem to commit to a solid answer.

What happens to your points if you purchase a new contract with an upcoming use year that is past the banking deadline. Example - if I were, today, to purchase a new contract with a December use. We are past the July banking deadline, and would have only two months to use the points before they expire (which would be impossible given the lack of room availability).

Obviously the easy answer here is to not buy a use year that puts me in that situation. It would seem horribly unfair to make those points use or lose on such short notice, or be forced to immediately push them into RCI. I've read on some other forums that, at the time of sale, you could request that they immediately bank those points for you. No one at DVC sales will confirm or deny that.

 

[DVC Ted]

Call MS and explain the situation. They will bank your newly purchased points for you. I’m surprised your guide couldn’t explain that to you.

 

[BlackCauldron]

Call MS and explain the situation. They will bank your newly purchased points for you. I’m surprised your guide couldn’t explain that to you.

For whatever reason, he sort of spoke around the issue, and would not (could not?) commit to agreeing that it would be possible to bank those newly purchased points even though it was after the banking deadline.

 

[LuvtheGoof]

For whatever reason, he sort of spoke around the issue, and would not (could not?) commit to agreeing that it would be possible to bank those newly purchased points even though it was after the banking deadline.

Weird, as MS is most certainly allowed to do this, and has for us a few times already.

 

[SteveAZee]

You're buying direct from Disney, not third party?

 

[LuvtheGoof]

You're buying direct from Disney, not third party?

I hadn't thought of that. If he is buying 3rd party, then MS will more than likely not allow him to bank the points, as the current owner should have already done that prior to the sale.

 

[BlackCauldron]

Weird, as MS is most certainly allowed to do this, and has for us a few times already.

Thanks thats good to know. I had a feeling that should be allowed, but perhaps the sales rep is not allowed to say so? It just seemed strange that he would not directly answer the question.

 

[LuvtheGoof]

Thanks thats good to know. I had a feeling that should be allowed, but perhaps the sales rep is not allowed to say so? It just seemed strange that he would not directly answer the question.

So we are all assuming that you are buying direct. Is that right?

 

[BlackCauldron]

So we are all assuming that you are buying direct. Is that right?

I'm still on the fence about it, but I am indeed leaning in that direction.

I'm looking at AKL, which still has 35/36 years left on the contract. Direct is about $183 per point, and I'd be looking at 150 points, which would at least give me blue card status.

Resale is obviously cheaper - I'd save around 6K on the purchase - but finding the points I want in the use year I need (and a fully loaded contract to boot) is proving difficult. Plus no member benefits. Add in the extra hassle of the time it takes to close on those contracts, and I'm not sure that's the best way for us to go.

 

[LuvtheGoof]

I'm still on the fence about it, but I am indeed leaning in that direction.

I'm looking at AKL, which still has 35/36 years left on the contract. Direct is about $183 per point, and I'd be looking at 150 points, which would at least give me blue card status.

Resale is obviously cheaper - I'd save around 6K on the purchase - but finding the points I want in the use year I need (and a fully loaded contract to boot) is proving difficult. Plus no member benefits. Add in the extra hassle of the time it takes to close on those contracts, and I'm not sure that's the best way for us to go.

Just remember from your original question. If you buy resale and there are points that are past the banking window, it is extremely doubtful that MS will allow you to bank them.

 

[BlackCauldron]

Just remember from your original question. If you buy resale and there are points that are past the banking window, it is extremely doubtful that MS will allow you to bank them.

Yes, I assumed that if we did go resale, anything the previous member failed to bank would essentially be lost. That also complicates some of the resale contracts. The more I talk it out the more I continue to lean towards buying direct. I also tend to prefer instant gratification, so I like that my points would be immediately available once they have cash in hand.

Do you happen to know offhand if Disney has the power to create a use year with the points they carry? Or are they beholden to the existing use year of any contract they buy back and then re-sell?

 

[LuvtheGoof]

Yes, I assumed that if we did go resale, anything the previous member failed to bank would essentially be lost. That also complicates some of the resale contracts. The more I talk it out the more I continue to lean towards buying direct. I also tend to prefer instant gratification, so I like that my points would be immediately available once they have cash in hand.

Do you happen to know offhand if Disney has the power to create a use year with the points they carry? Or are they beholden to the existing use year of any contract they buy back and then re-sell?

In the past, if they exercised ROFR on a contract, it retained the existing use year. A few years ago they changed the rules and can now change the use year on points they resell.

 

[SteveAZee]

Yes, I assumed that if we did go resale, anything the previous member failed to bank would essentially be lost. That also complicates some of the resale contracts. The more I talk it out the more I continue to lean towards buying direct. I also tend to prefer instant gratification, so I like that my points would be immediately available once they have cash in hand.

Do you happen to know offhand if Disney has the power to create a use year with the points they carry? Or are they beholden to the existing use year of any contract they buy back and then re-sell?

I looked at buying direct and weighed the value of the benefits vs the savings in buying resale. With my travel and spending habits, it made more sense financially to go resale. That's me though.

 

[BlackCauldron]

I looked at buying direct and weighed the value of the benefits vs the savings in buying resale. With my travel and spending habits, it made more sense financially to go resale. That's me though.

That is the part I am struggling with myself - the value of discounts with blue member status vs the immediate cost savings of resale.

150 points direct at AKL would be $27,300. On the resale market, I've seen 150 point contracts roughly around the $21,000 mark. Closing costs do seem to be slightly higher for resale contracts (around $100-$200 higher than direct). There's also wide variability of sellers wanting to pay annual dues, whereas Disney will immediately pro-rate them based on the date of purchase. Generally speaking, and looking only at an apples to apples comparison of cost per point, buying direct runs about $6,000 more than resale.

Over the course of the next 35 years, would I rack up a savings of $6K using member discounts on shopping and dining? Perhaps. . . I honestly have no idea, but I do know that 10% here and 20% there absolutely add up over time.

 

[SteveAZee]

That is the part I am struggling with myself - the value of discounts with blue member status vs the immediate cost savings of resale.

150 points direct at AKL would be $27,300. On the resale market, I've seen 150 point contracts roughly around the $21,000 mark. Closing costs do seem to be slightly higher for resale contracts (around $100-$200 higher than direct). There's also wide variability of sellers wanting to pay annual dues, whereas Disney will immediately pro-rate them based on the date of purchase. Generally speaking, and looking only at an apples to apples comparison of cost per point, buying direct runs about $6,000 more than resale.

Over the course of the next 35 years, would I rack up a savings of $6K using member discounts on shopping and dining? Perhaps. . . I honestly have no idea, but I do know that 10% here and 20% there absolutely add up over time.

For me, I am buying OKW 2042 contract, so it's less expensive than the extended contract at resale and much cheaper than getting the extended contract direct, since they're only selling the 2057 direct. I'll be 84 when the contract ends and I figure I'll do 6 or seven trips between now and then. I don't buy a lot of merch so the big 'on property' savings is dining mostly, as I recall. It just didn't pencil out that I and three other people would eat that much (or, correction, SPEND that much) on food. In your example of $6000 savings, if I spread that over my 10 night/9 day trips taken 6 times, assume 15% savings (roughly) applied to four people, it's something like spending $185 a day per person each day on DVC discounted items to break even. I would not like to put myself in a position where I need to spend/est that much just to justify the cost. Again, that's just me.

I also can understand the desire for the quicker gratification. I won't be closing until November.

 

[BlackCauldron]

I also can understand the desire for the quicker gratification. I won't be closing until November.

If I may ask - how much time passed between your initial offer and the closing date? And which resale company did you use?

 

[SteveAZee]

If I may ask - how much time passed between your initial offer and the closing date? And which resale company did you use?

I'm buying from someone I've rented points from over the years. Once we decided to buy/sell, he had committed some of the contract's points to another renter, who completes their vacation in early November. We decided to go through the process of settling on the price and getting through most of the paperwork and pushing it through Disney's ROFR test (we passed) early on... months ago. So, we're now just waiting to close once the rental points are used the the contract is available.

I selected dvcresalemarket since they gave us a good deal on the closing costs since we (buyer/seller) had already connected and just needed the paperwork processed. They've been really good to work with. I honestly can't say what their pricing is like compared to their competitors (and I had a list of 6 or 7) but they were fine 'cutting a deal' since they didn't need to do any of the marketing or listing of my friend's contract.

 

[striker1064]

If I may ask - how much time passed between your initial offer and the closing date? And which resale company did you use?

A good rule of thumb is about 90 days. There are lots of resale companies out there, so your best bet is finding the contract you want rather than waiting for one to a certain broker.

 

[nickys]

@BlackCauldron , just jumping in here to check you know about Disney’s “right of first refusal” on a resale offer? A resales broker should explain it to you, often referred to as ROFR.

Once you make your offer and it’s accepted, the details are sent to Disney who have the right to buy the contract back for the same price that you just offered.

They used to aim to decide within 30 days. Since re-opening, however, it has often been taking longer. That can impact the time between the offer and closing.

 

[BlackCauldron]

@BlackCauldron , just jumping in here to check you know about Disney’s “right of first refusal” on a resale offer? A resales broker should explain it to you, often referred to as ROFR.

Once you make your offer and it’s accepted, the details are sent to Disney who have the right to buy the contract back for the same price that you just offered.

They used to aim to decide within 30 days. Since re-opening, however, it has often been taking longer. That can impact the time between the offer and closing.

Thanks for your reply. Yes, I'm aware of the ROFR. That's another reason I'm a bit more leery of a resale contract. Settle on a "too good to be true" cost, and Disney will absolutely swoop in and grab it. And they could take a few months to make up their minds. I've also read that their buybacks of AKL contracts is higher this year than previous years.

Realistically, I think I'd be looking at a minimum of $130 per point at best, assuming I could negotiate down that far. But typically, these all seem to be going in the range of $135-138. Of course, there's no guarantee those would pass ROFR, but seem more likely to do so.

And then there's the waiting game of trying to find a contract that has what I need and also represents a decent savings over direct.