Disney Vacation Club Resale Guide
Before considering a DVC resale, make sure you have read my Disney Vacation Club Guide.
While I have only purchased direct from Disney, I have spoken to real estate brokers and considered buying a Disney Vacation Club Resale. I ended up purchasing direct since at the time the home resorts I wanted to buy at were too new for resale. Even with the restrictions on a Disney Vacation Club Resale today and with Disney’s inflating prices, I would definitely consider buying resale even more now. Being that when I’m looking to spend as much as the DVC costs, I like to do a ton of research hopefully this can help you. If you have any questions, please do post them. I do try to respond.
When looking to buy into the Disney Vacation Club, and it doesn’t matter if it’s direct or resale, you need to understand how many points you will need as well as how often you want to vacation. Once you have this information, you can check out some of the various Disney Vacation Club Resale agents’ websites to see what contracts are up for sale.
When thinking of buying into the Disney Vacation Club and seeing just how high Disney is raising the prices, it’s no wonder people would want to buy points on the Disney Vacation Club Resale market. This is a more complicated process than buying direct from Disney, and while there are some disadvantages to buying a Disney Vacation Club Resale contract, the price isn’t one of them.
The first decision you need to make is if resale is for you, and I would read my post on Direct or Resale. Once you have decided to buy resale, you should do some looking.
Disney Vacation Club Resale Restrictions
Please remember, the Disney Vacation Club Resale contracts do have restrictions. They don’t work for the Concierge Collection, the Disney Collection or the Adventurer Collection. The Disney Vacation Club Resale contracts also don’t work for cruises. They do work for other DVC resorts and for RCI Exchanges only. If you feel the cost is worth it to get all the features, buy direct.
Disney Vacation Club Resale Timeshare Companies
You will find you can’t buy or sell a resale direct from Disney. You will end up having to get a real estate company that specializes in helping people buy or sell timeshares. There are various Disney Vacation Club Resale companies that do this, and I would definitely research them. You will want to look at their websites and look them up both on Google and on the Better Business Bureau’s website. Here are some of the top ones I have heard of: The Timeshare Store, Resalesdvc, and Fidelity. I have used The Timeshare Store in the past and recommend you speek to Jerry. He was very helpful to me and answered my questions, even though I didn’t end up buying.
There are two ways they will operate. Some will charge you an upfront fee and some will charge you commission. The biggest problem with an upfront fee (this is usually only when selling) is that if you decide not to buy or something happens, you’re out that money. I tend to lean toward getting charged commission as the company has a bigger incentive. The other thing I would do is research the Disney Vacation Club Resale company that you may use, you can e-mail me and I can recommend a few places and brokers.
Don’t confuse Commission and Fee’s with Closing Costs. All title companies will charge this regardless. A Disney Vacation Club Resale closing costs to guarantee a free and clear title. The Disney Vacation Club Resale costs fee includes; A Title Search, A Title Insurance Policy, Recording Fees for the new deed, and the State and County taxes.
Understanding the Resales
When looking into buying the Disney Vacation Club Resale listings can be a bit complicated, so make sure you’re understanding what you are reading. Here is a sample Disney Vacation Club Resale Listing.
Resort: Animal Kingdom-$70/pt.
Use Year: December
Closing Costs: $500.00
Annual Dues at Closing: $990.08
Banked Points: 0
Notes: 182 points coming on 12/1/12 and 200 points coming on 12/1/13. Priced at $70 per point.
With this type of listing, you see all the information however; the $14,000 isn’t your full cost. You would pay that price, plus the Closing Costs and the Annual Dues at Closing. So, you would be looking at a total cost of $15,490.08. If you finance this, the interest would be even more. The combined cost is still less than buying direct from Disney.
If you had banked points, you would need to use those by a certain date or they would disappear. Typically they would expire the first day of the month of the current year, so if there was some here they would expire on 12/1.
With a Disney Vacation Club Resale listing, the owner may have used some of the current year or they may have banked the prior year. Make sure you read the listing to get all the details on that. The most popular Disney Vacation Club Resale listings are the smaller point ones. These seem to be picked up right away.
Stripped Disney Vacation Club Resale Contracts
A Stripped contract has no banked or current points and may even have points already borrowed from the next Use Year. These Disney Vacation Club Resale stripped contracts are less popular, and you may get a better deal to buy one of them. These Disney Vacation Club Resale contacts are good if you have just been to Disney and and don’t plan on going back right away.
Disney’s Right of First Refusal
Once you find a Disney Vacation Club Resale contract you like and you make an offer and the seller accepts; the agent will draw up the contract. The contract is then forwarded to Disney. With all Disney contracts, Disney has the option to buy the Disney Vacation Club Resale contract back since they have the Right of First Refusal. If the price is too low, there is a good chance Disney will buy the Disney Vacation Club Resale contract directly.
When buying, make sure to ask the agent if they will be refunding deposits or fees if Disney does exercise this right.
Disney has 30 days to review the contract. If they don’t buy it, Disney sends the paperwork to the title company. They prepare the final documents and once executed the contract is closed and Disney is notified of the transfer of title.
Once it has passed ROFR, it’s up to the title company to send the Disney Vacation Club Resale paperwork to Disney so the loan is processed. Each timeshare broker uses different ones. Some are good, some aren’t. You will have no choice in which they have, but be aware they can make the process longer. When researching which company to use, make sure you watch for when people complain about how long the title company takes.
While you can buy any use year, my advice is that if you already have points, keep the same use year. Having different use years means you have different contract numbers and it isn’t as easy to combine points for one stay. I would always buy the same use year.
You can have ownership at more than one resort; I would still keep the same use year when buying a Disney Vacation Club Resale contract as that makes booking easier.
For smaller contracts (under $5,000), financing is generally not available. For larger Disney Vacation Club Resale contracts you will be able to finance. Just make sure you tell your broker that you want to finance and he should give you payment options. Disney timeshare resale financing is pretty high.
Disney Vacation Club Resale Financing Terms are up to 120 months
Minimum loan amount $5,000 & maximum loan amount is $250,000.
Finance APR Rates: 10% down – 13.90% & 20% down – 12.90%
Your other options may be a personal loan or a home equity loan. A Home Equity Loan would give you a much lower interest rate. The interest rates for these types of loans are at 3.25% – 4.25% and the interest is tax deductible since it is considered a mortgage.
Backing out of a Resale
As the buyer, you have a 10 day period to back out of buying a Disney Vacation Club Resale by Florida law from the date you sign the contract. Generally, there is a wait to buying resale, so make sure you have some patience.
You can try to negotiate on the Disney Vacation Club Resale contract with the seller to bring down costs per point or to pay the closing costs. These are options to speak to your real estate broker about. I would ask if there are other offers on the Disney Vacation Club Resale contract and if there are none try to make a deal. Smaller Disney Vacation Club Resale contracts are generally more popular, so on those you may not get much room to negotiate.
How long does it take to close?
I’m told a Disney Vacation Club Resale could take 5-8 weeks to close, but this is when there are no delays by anyone. With delays it can take longer.
When can I make a Reservation?
Once you close, you will need to wait 1-2 weeks to be able to make your reservation.
When will I get my member card?
30 days after you close, but you don’t need it to make the reservation. Member services can look you up by name.
Disney Vacation Club Resale Selling
When looking to sell, some Disney Vacation Club Resale companies charge fees, others only charge commission once they make the sale. I am told that most scams start by charging an upfront fee, so you should stay away from that regardless. Selling can take time, so make sure you’re patient. How long will depend on the cost per point you’re selling for.
Make sure you read any Disney Vacation Club Resale agreement with the broker as to the fees and commission you will pay once it sells. The common Disney Vacation Club Resale fees are the commission, a $20 Right of First Refusal Fee, and a $50 Estoppel Fee (This is a “must” to have in order to do the closing. It establishes the money needed for payoff to all parties involved, points’ distribution, etc). If you have an open loan or late fees on your current contract, those will be deducted. When looking to sell, make sure you factor in all the different fees to get an estimate of what you’re due to get back once sold.
Once the contract is sold, it can take as many as 60 days to close.
Bear in mind, when dealing with a complex real estate transaction like buying or selling a timeshare, this process will take a while.