Amassing small point contracts - what are the downsides?

[JPKnapp]

Other than cost per point, what are the downsides to amassing smaller point contracts (assuming all the same use year)?

Before I finalize my first contract... my biggest concern (more of a personality flaw if you ask my SO) is I always want to be ready financially for absolute and highly unlikely worst case scenario. My definition of worst case is needing to sell. And when you sell anything you waant to have the most attractive product for sale in the market (thus holding value in relation to other contracts for sale).

With that said, is there any other downside to taking a few months to amassing smaller point contracts vs one larger one? I am really feeling the flexibility of selling part vs needing to sell it all is worth the $25/point or so additional.

Your opinion?

 

[PlutoFan10]

We have six contracts and the largest is $100 points. We have several 50 point contracts. You do pay more closing costs in the end and if you ever wanted to add someone to the deed you would have higher legal fees. You also pay more per point in resale when you amass small-point contracts. But, as you said, if we needed to sell a few contracts to lower yearly dues, we can do that and they usually sell quickly in today’s market.

 

[Marionnette]

I’ve added on with multiple small contracts over time because I wanted to be able to pay cash for each one. In all, there are10 contracts spread over 4 UYs. The number of contracts is not unmanageable but having multiple UYs can get confusing. It’s not something that I would recommend unless you are extremely organized.

 

[Sandisw]

Owning small contracts can certainly be a nice thing down the road as you can sell something and still remain a member.

IMO, i think new buyers should be very cautious in how they calculate what they may get back if they had to sell. You may or may not get back what you paid and buying so many will add cost,

You also realize that if your contracts are different resorts, even if the same UY, you can’t combine points until 7 months out. Points never change home resort so if you own, say 50 at BLT and 50 at AKV, unless you utilize banking or borrowing, only 50 points can be used at 11 months at BLT or 50 points only at AKV.

It will be much harder going resale route finding so many smaller contracts, But if you are in no rush, then it can be a good strategy If you are okay with all the extra closing costs.

I would decide what your goals are in terms of total points, home resort or resorts, and then begin the search.

Good luck!

 

[TikiRob]

As someone who just purchased our first contract, I think waiting for each small resale contract to close would be the biggest downside!

 

[GaSleepingBeautyFan]

We got 2 small resale contracts with the same UY for the same resort - (just waiting on the 2nd one to finish closing).
Since they are the same UY it's easy to keep track of. Plus we have one contract that is larger that we bought from Disney direct. I did hate that we paid a higher price per point on the small contracts but we were paying cash so we had to go with what we could afford.

Since I don't worry about selling the contracts, I haven't thought about the re-selling. But I think small competitively priced contracts do sell faster.
I'd just get what you want right away rather than messing with small point contracts - you can find a better price on larger point contracts.

 

[ray3127]

Other than cost per point, what are the downsides to amassing smaller point contracts (assuming all the same use year)?

Before I finalize my first contract... my biggest concern (more of a personality flaw if you ask my SO) is I always want to be ready financially for absolute and highly unlikely worst case scenario. My definition of worst case is needing to sell. And when you sell anything you waant to have the most attractive product for sale in the market (thus holding value in relation to other contracts for sale).

With that said, is there any other downside to taking a few months to amassing smaller point contracts vs one larger one? I am really feeling the flexibility of selling part vs needing to sell it all is worth the $25/point or so additional.

Your opinion?

The flexibility to sell off a portion of your points is really, really nice. I thought my 200-pointer was about right, but now I wish it was split into a couple 100-pointers, or even a 100 and a couple 50's.

Wants/needs change, and as new resorts come online you may want to trade some points out. Smaller contracts definitely allow you to do that better than larger ones. Yes, it comes at a higher upfront cost, but I think it can be worth it. 100 seems like an ideal contract size to me.

 

[WhenIsOurNextTrip]

My original plan when starting to put together a Dvc portfolio was the same, buy 50 pt contracts resale and add on more 50’s. Then I came to realize I wanted 100 to 150 at several resorts and it takes so much work to constantly check all the resale sites every day looking for more 50 pointers with the same use year and fairly priced. So I scrapped that plan and got a few 100 pointers because I didn’t want to spend an hour or two every day for a year hunting 50pt contracts.

 

[Best Aunt]

... With that said, is there any other downside to taking a few months to amassing smaller point contracts vs one larger one?

My original plan when starting to put together a Dvc portfolio was the same, buy 50 pt contracts resale and add on more 50’s. Then I came to realize I wanted 100 to 150 at several resorts and it takes so much work to constantly check all the resale sites every day looking for more 50 pointers with the same use year and fairly priced. So I scrapped that plan and got a few 100 pointers because I didn’t want to spend an hour or two every day for a year hunting 50pt contracts.

@WhenIsOurNextTrip makes a good point. It is much easier to manage your points if they all have the same Use Year. If you want to buy on the resale market, you can look every day for a year and not find a small contract at the resort you want with the Use Year you want.

I remember someone describing a 50 point BWV contract with their Use Year as a "unicorn" because it was so hard to find.

 

[poofyo101]

I think the only issue with small contracts it the recurring closing cost price.