Buying DVC Resale

If you’re here it’s because you’ve gone down the rabbit hole of the Disney vacation club and are now at whether buying DVC resale makes sense and why or why not. 

Disney Vacation Club (DVC) operates 14 resorts nationwide, the majority of which are located at Walt Disney World in Orlando.  If you want to travel to Disney World on an annual basis, buying a DVC membership may be worth looking into. The Disney Vacation Club is just one avenue to help make your trip to Disney as affordable and easy as possible.  

But there are two ways to purchase into the Disney Vacation Club. You can either buy a membership directly from Disney or through the DVC resale market.  Before we get into the DVC resale process and understand why you would consider buying DVC resale, what is the Disney Vacation Club exactly?  

The Disney Vacation Club is a timeshare program, which includes various levels of points that you can redeem for stays at the different resorts within the program.  It’s a great way to lock in savings if you plan on vacationing at Disney on a regular basis.  

Every year, you will receive a certain number of points you can redeem for stays at any of the resorts within DVC’s holdings.  The properties are primarily located at Walt Disney World in Orlando, although a few are elsewhere including The Aulani Resort in Ko Olina, Hawaii.  

Before buying into the Disney Vacation Club, it’s important to consider whether it’s the best choice for you, so you need to consider the costs involved and decide if the savings involved are worth the buy-in and yearly maintenance costs.  Look at DVC resale listings or Disney Vacation Club directly to get an idea of what properties you’d be interested in.  

There are three main costs to consider here: 

  1. The buy-in costs: When buying directly from Disney, you’ll pay roughly $193 per point.  If you buy 200 points, that’s $38,600 upfront. When buying from the DVC resale market, you may be able to get the contract for 50-70% of the cost.  
  2. The closing costs: These range from roughly $500 to $1000 depending on the property.
  3. The annual dues: For example, at the Grand Floridian, these are $6.39 per point.  If you have 200 points, that’s $1278 per year in dues. It’s also important to note that annual dues can increase from anywhere to 3% to 15% a year.  You can either pay your dues in one lump sum annually or break it up on a monthly basis for easier budgeting. When buying DVC resale, your annual dues may be much lower than buying direct.  

It’s important to understand the DVC resale process, what’s the difference between resale and direct, and explore all avenues when researching both Disney’s listings and the DVC resale listings in order to choose the best DVC membership for you.  

Potential Savings you could be looking at if you buy directly from Disney: 

If you’re planning on buying into a DVC membership and using it year after year, the savings can be phenomenal.  Let’s look at a scenario for a better understanding of the potential benefits here.  

Disney’s Grand Floridian Resort & Spa

Cash Price: A 2 bedroom Villa with a Standard View at the Grand Floridian in March (around Spring Break time) will cost $1934 a night.

Points Price: The same 2 bedroom villa goes for 64 DVC points.  The annual dues on those 64 points are $409 a year, so you’re spending $409 a night to stay in a room that costs $1934 a night (that’s a massive saving at $1525 a night). 

Before taking those cost savings at face value, it is important to delve into options of buying into the vacation club and factor in buy-in costs.  

There are two ways to purchase a DVC membership.  You can either buy directly or look into the DVC Resale market.  The DVC resale process won’t close as quickly as buying directly from Disney, but the cost savings can be huge.  

Costs when buying directly from Disney:

Let’s assume you were to buy a 200-point membership with the intention of spending 3 nights in the 2 bedroom villa with a Standard View at the Grand Floridian each year.  

This is what your costs would look like: 

200 x $193 = $38,600 for buy-in costs 

Closing costs = Estimated $600

Annual Dues = 200 x $6.39 = $1278

Assuming a savings of $1525 a night ($4575 – Annual Dues of $1278) = $3297, it would take you roughly 12 years to break even.  If you’re planning on visiting Disney yearly for 30-40 years, you could save roughly $60,000 – $90,000 on your vacation costs!  

You should only consider buying into the Disney Vacation Club if you: 

  • Regularly vacation at Disney Vacation Club properties and plan to do so for the next several years or even decades
  • Are financially able to cover all the buy-in costs and annual dues without the risk of going into debt

What’s the Difference between resale and direct?

When exploring membership in the Disney Vacation Club, there are a lot of things to consider.  The first is understanding what’s the difference between resale and direct and deciding which is the best fit for you.  

Property Choices

 It’s important to note that if you want to buy into older properties like the Grand Floridian, buying directly from Disney might not be an option.  Disney only directly sells DVC memberships for its newest properties, so you would have to get on a waitlist, so you might want to look into the DVC resale process right away.  

There are DVC resale listings that show how many points people are selling, at which property, and how soon the points will be available.  A quick check of the DVC resale listings showed several options at the Grand Floridian up for sale right now.  

Costs

Many current DVC owners sell their memberships because their lifestyle has changed and they’re no longer taking annual vacations to Disney.  Buying DVC resale can mean buying a membership at 50-70% of the original price.  

Financing

You won’t be able to finance your timeshare membership through Disney themselves, so if you need financing, you will need to secure a loan from another company, adding one more step to the process.

Possibility your sale will be denied

When buying through resale, you can bid on what you want to buy the membership for.  However, Disney has the Right of First Refusal with resales, meaning that they have 30 days where they can decide if they want to refuse the sale and purchase the timeshare themselves at the pre-agreed upon terms.  This is the biggest risk and disadvantage of buying DVC resale.

They’ll do this when they think it’s worth selling it themselves at a higher rate.  This doesn’t hurt the seller at all but wastes the time of the buyer, who goes through the whole DVC Resale process only to be refused a contract and will, unfortunately, have to return to the DVC resale listings and start the process all over again.  Last year, 17% of contracts sold by the DVC Resale Market were refused by Disney. The other 83% were sold on the original contract.  

 So, if you bid too low, the seller will receive a counteroffer from Disney and you’ll be out of luck.  Be realistic when making an offer.  

Length of Process

If you want to be able to use your membership as soon as possible, buying directly through Disney will close the process faster.  They can expedite and close the sale in just a few days. But, if you want the best deal you can possibly get, the resale market is your best avenue.  

My own process took about 45 days which is average.  The right of first refusal, done by Disney, takes up to 30 days.  

DVC Perks

If you buy through the DVC resale market, you won’t be able to get all the same perks as DVC members who buy directly from Disney, like discounts on annual passes.  You also cannot use your resale points (purchased after January 19, 2019) to book at the new Riviera resort, unless your DVC points are specific to the resort. If your heart is set on the Riviera Resort, then buying DVC resale might not be worth it for you.  

Another benefit of buying direct is that you can get the exact number of points you want (the minimum is typically 100, although sometimes you can buy 50), but if you buy through the DVC resale process, you’ll have to wait for the amount you want to come up or be flexible based on what offers are available.  

Cost Benefits of buying DVC Resale: 

I searched the DVC resale listings for DVC resales at the Grand Floridian and found a few listings for resales of 200 points.  

This is what your costs would look like: 

At 70%: 

Buy In Costs: $27,000

Closing costs: $500

Annual Dues: $895

Assume the same savings as above: $1525 a night for 3 nights = $4575 – Annual Dues of $895 = $3860. 

It would take you just over 7 years to break even.  If you plan to visit the Grand Floridian annually for 30-40 years, you could save $88,000-$127,000 on your vacation costs.  

Some offers of 50% have also been accepted for properties bought through the DVC resale market.  

That would look like this:

Buy-in Costs: $19,300

Closing costs: $500

Annual Dues: $639

So: ($4575- Annual Dues of $639) = $3936

You could break even in roughly 5 years.  If you plan to visit the Grand Floridian annually for 30-40 years, you could save $98,000-$137,000 on your vacation costs.  

That’s just the face value as well.  You could use your DVC membership at many different Disney World resorts each year, and also go to Hawaii and California.  If you were to buy direct instead of through the DVC resale market, you could also use them at Disney resort hotels elsewhere, like in France, Hong Kong, and Japan.  That said, your points have the highest value at the DVC resorts anyway.  

What is the DVC Resale Process? 

If you decide that buying DVC resale is a good fit for you and your family, you’ll have to start looking at DVC resale listings to see what type of contract would be the best fit for you.  

You’ll want to decide on the optimal home resort, a number of points you’ll need each year, and when the points are available each year.  Depending on the contract, the points can come up for availability in various months. For example, if you want to start using your membership right away, you might not want to buy a contract in March 2020 that you can’t use until July 2021.  

You can book 11 months in advance at your home resort, but only 7 months in advance at other DVC properties, meaning that if you’re planning on regularly staying at other properties, you might not always get your first choice of rooms or resorts during peak times.  

Once you’ve created a wish list of roughly what you’re looking for, you should look through all the DVC market resale listings until you find your perfect contract.  

Set up Financing

Because you can’t finance a DVC timeshare membership directly through Disney if you’re buying DVC resale, financing is an important part of the DVC resale process.  Financing a DVC timeshare membership isn’t necessarily the best call financially, as you’re not financing something that’s going to increase in value as it gets closer to its expiration date.  However, if you do the math for your family’s budget and decide that financing is better than tying up principal that could be better invested elsewhere, or you’re close to being able to put down the principal but don’t quite have it all, financing your DVC membership is an option.  

The most commonly used company when buying resale is Monera Financial.  If you have poor credit, this is the way to go because they don’t do credit checks.  They just use the collateral, so if you don’t pay off your loan, they will resell your timeshare themselves.  That said, their rates are a little higher than other places (between 9.9% and 15.9% depending on the amount and length of the loan).  

If you have strong credit, you might want to look into financing with LightStream Financial, a division of Sun Trust Bank, as their rates are a bit lower, ranging between 7.44% and 13.9%.  

Once you’ve found a contract that fits your needs and secures the necessary financing, it’s time to make an offer!  Fill out the offer form on the listing’s page.  

After the terms are agreed upon, a contract is created, signed off on by everyone involved, and then submitted to DVC.  

This is when the Right of First Refusal comes into play.  Assuming Disney waives the Right of First Refusal, the contract is closed.  It takes a few weeks for all the documents to be finalized and money to be transferred.  Once this happens, you can start planning your trips to DVC resorts, and get ready for an amazing vacation!

If the costs of buying into the Disney Vacation Club don’t seem like a good option for you right now, but you still want to spend your vacation at a DVC resort, there are still plenty of opportunities for rentals that you can look into. 

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