Giving an unwanted deed back to Disney.

[ginnyfish]

I first want to say how helpful you have all been. I have found reading back through all the advice answers most of my questions, so thank you all.

So, we are very close to buying, but I keep coming back to one big sticking point.

What if we can't afford the dues into our 70's and the contract is worthless. Say, for exsample, the cost of the dues at this point out way there cost of booking directly, like what has happened with many timeshares in Spain. Can't I give back the deeds to Disney if I no longer want them? Or would we be foursed to forclose?

Has anyone asked a lawyer about this when going over their contract?

If the contract says that we have the right to return it to Disney at any time, I think we will move forward, but if not, it might not be right for us.

[Mr Tom Morrow]

Interesting question and sorry I don't know the answer. One should be able to rent out Points to cover the annual dues right up until the end of the contract when on a certain day the deeds return to Disney with no value at all remaining in them.
I do know that nearly all of the foreclosures are because of non payment of annual dues so one could just decline to pay I assume? However I don't know if they attach a further financial penalty to the process, one suspects not as there is no point flogging a dead horse.

DVCMike probably knows the answer, maybe worth dropping him a PM.

[ginnyfish]

Thanks Tom, I will try DVCMike. My thinking was, worst case, if the dues out way there cost of booking direct in the future, there would be no chance of renting out unwanted points, as they would cost more than booking direct. I don't think I could go though with a forced foreclosure option. I would find it too stresssfull.

[Pootle]

I don't know the answer, but on this, I suspect that you are worrying unnecessarily. Here's why:

I've owned most of my points for 21 years so, yes, I did buy when they were cheap compared to today's prices. But, I sold some 2 years ago, and even after costs, I got my money back. No saying that will continue going forward, but as I'd long ago considered the buying in costs to be a 'sunk' cost (in other words, I'd had my money's worth so only considered the dues in terms of what I was 'paying' for rooms), it was amazing that the points still had such value - they were OKW and VB points I sold.

Now, especially if you buy at a WDW resort, do you think that the parks will still be operating when you are in your seventies? Do you think that accommodation close to the parks will still be valued? Granted, as the years left on the contract decline, it may be worth less should you need to sell. What makes you think that accommodation is not going to rise in price along with the dues?

I can tell you that the cost of decent hotel accommodation in Florida has gone up quite a bit in the last few years - in dollar terms that is; nothing to do with the sterling v dollar rate.

We do not stay put when in the USA. Our recent month included hotel stays in Orlando north, Savannah, Lake Buena Vista and Port St Lucie, and DVC stays at Hilton Head, OKW and BWV! The LBV stay we commonly do before an OKW stay so that we can be up early the next morning to give us choices of room locations at 6.30 am check-in The hotel stays were for 1 night en route mostly, but boy has the dollar cost gone up.

A long-winded way of saying that I believe that the dues will always be reasonable compared with the cost of staying on property. In fact, my BWV stay was costing about £50 a night (dues only) whereas the Marriotts (Palm Parkway or Marriott Village) were £70+ a night booked direct (similar prices on Travel Republic and Hotelopia, which I use if they are much cheaper.)

DVC has been great for us. But I would not advise anyone to buy direct from Disney at today's prices, and only indirect for a really good-priced contract, given the current exchange rate. I think you are absolutely right to consider all aspects of ownership. We took 6 months and 2 visits before signing up!

Have you taken a look at the Canadian rental site that acts as an intermediary and rents out points for you? I've read good things about this service, and I intend to consider using it in a couple of years' time when we have a very big holiday planned and may not make it to the USA. It should cover my dues and then some - it's a business with a few employees and I doubt anyone there expects that dues will ever be more than the cost of Disney accommodation!

Sorry this is so long - precis was never my thing . I just hope it makes sense.

[ginnyfish]

Thanks so much Pootle, and I totally understand your point.

I just like to work form a 'worst case' perspective, so that I know all my bases are covered.

I know that while Disney is still building and selling new DVC contracts, it will be ok. But once they decided to stop, and no longer have an intrest to keep dues inline to make the deal appealing, i fear it 'could' all change. The dues can legally go up by as much as 12% per year and that's a lot when you look at it over say, the last 5 years of a contract. I have rented points with places like Dave's before, and at the moment, I know DVC is a great idea, I just would like to cover my back for the future, if Disney decide, say, to do a massive refurb in the last few years of a contract and I have to pay for it. This would make sense from their prospective, as they would get lovely new units when our contract ends, passing on the cost to DVC owenrs just before their contracts run out.

As I said, just trying to cover the bases, I think for the next 10-20 years at least, it makes lots of sense, just want to know if I miss the right time to sell, and I feel I'm being treated unfairly, I can just walk away if I want to.

[BevS97]

I own at the Boardwalk. A preferred studio costs 15 points a night. My dues are $6.4725 so I need to make $98 to cover my costs.

To book the same studio is $471
And to book a similar room at the inn is$485

The question is. Do you think over 25 years the cost of dues will rise so rapidly that it will exceed the cost of booking the room directly. Or to within a margin that it's not worth the hassle.

I bought in 2007 but I can only find the dues from 2008
BoardWalk Villas: $5.0402


The question is, do you think room rates will drop or dues rise to such an extent that the DVC will become worthless.

It is true that as 2042 approaches resale may drop as it will be harder to sell a contract with 5 years on it. But I think we should always be able to cover our dues through rental income.


The bigger issue is the exchange rate over which we have no control. The cost of getting to the USA to use the room. And I would agree with previous posters. Buy resale for half the price.

[ginnyfish]

Thanks for the advice Bev, it's not so much that I think they will rise above the cost direct, I just want to make sure I have a plan if they do. I'm just wired that way. I like to hold a 'get out of jail' card on long time commitments.
Everyone's advice has been really helpful. I think I need to take this question direct to Disney. I will be sure to post back here if I can get an answer!

[ginnyfish]

DVCMike has got back to me and it seams that the only option would be foreclosure. Its such a shame that Disney doesn't have a clause to hand over the deed if someone no longer feels the dues are fair.

[KarenG]

Originally Posted by ginnyfish

DVCMike has got back to me and it seams that the only option would be foreclosure. Its such a shame that Disney doesn't have a clause to hand over the deed if someone no longer feels the dues are fair.

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I suppose that would go against every timeshare practice in the book; I'm thinking about the timeshares where the dues costs greatly outweigh the value the contract itself continues to hold. DVC has not so far "behaved" like those models insofar as its continued to maintain and even increase value.

I can see your concern but honestly think you shouldn't worry.

I think our DVC expires when we hit our late 60s so I hope to continue to enjoy it until then


The thing that would deter me, right now, from purchasing, is the exchange rate.

Either way I would not buy direct from Disney.

[BevS97]

you can always sell your DVC. And Disney buy them back themselves if the price is too low. Which keeps the price artificially high.

Again. There is no guarantee they will continue to do that.

I think you'd have some warnings that resale prices were dropping before they ever became worthless but I don't think anyone will give you a get out clause.