Direct Add-on Timing and Discounts after Initial Ownership

[JoeyPeligroso]

I've been reading a lot about add-on purchases here since I made a first-time direct purchase this summer. Recently, a very interesting thread has presented what has been speculated to be a direct purchase at RIV of >1,000 points in multiple small contracts with immediate resale of some of the same contracts to create the lowest possible initial purchase price-per-point for the buyer and recoup some of the overall costs immediately as well. It has been speculated that the buyer only ever intended to own something far less than 1,000 points, but wanted to achieve the lowest possible direct purchase price - and was also willing to risk recouping upfront costs in the current resale market on some of the RIV contracts purchased. In this scenario, the new owner also appears to have purchased numerous small contracts as a further hedge on the purchase. This is certainly a luxury and risk that few can afford, especially in this environment. It's also a purchase strategy that appears to be far from normal at an overall point number that is so high.

My question is somewhat more practical, I hope: if a DVC owner purchases points direct (or even resale) and then chooses to make an additional direct add-on purchase to take advantage of an advertised, lower-per-point than base-price purchase, is there a duration of time that you must be an owner before this may be done?

For example, if my contract closed as a new owner in August 2020 and I wished to make a direct add-on purchase at a currently advertised and discounted add-on rate, when am I eligible to make that purchase? Immediately? After a period of time passes?

In my example, would I have been better served (in retrospect) to have purchased a larger amount of points at the time of my original, direct purchase, then sell some of my points if I later realize that my purchase was larger than needed? Or is it wise to make a smaller initial purchase, assess your needs in the short time with a visit, then add-on (if you prefer the direct route in this example) with a discounted add-on contract, assuming that discounts may still be available for the same resort in the near term?

I recognize that many users here prefer the resale add-on route, but for those considering a direct add-on, what is considered best practice?

Thank you!

 

[Sandisw]

You can add on contracts with member discounts as soon as you are an owner,

I bought resale in 2009, and as soon as that contract closed and I got my membership number, I called and added on at BLT with member pricing. It was literally the day after I became a member.

 

[RoseGold]

would I have been better served (in retrospect) to have purchased a larger amount of points at the time of my original, direct purchase, then sell some of my points if I later realize that my purchase was larger than needed?

Every resort except RIV has a known resale value. You can see exactly what they are going for right now. The difference is more for some than others.

No one knows what will happen with locked down RIV resale. I think the handful of sales that have gone through have been higher valued than anyone expected.

Long term, it’s smart to split your points into smaller contracts for a lot of reasons: inheritance, smaller contracts are easier to sell, they sell for more, maybe you want less points as kids get older...

 

[we"reofftoneverland]

I've been reading a lot about add-on purchases here since I made a first-time direct purchase this summer. Recently, a very interesting thread has presented what has been speculated to be a direct purchase at RIV of >1,000 points in multiple small contracts with immediate resale of some of the same contracts to create the lowest possible initial purchase price-per-point for the buyer and recoup some of the overall costs immediately as well. It has been speculated that the buyer only ever intended to own something far less than 1,000 points, but wanted to achieve the lowest possible direct purchase price - and was also willing to risk recouping upfront costs in the current resale market on some of the RIV contracts purchased. In this scenario, the new owner also appears to have purchased numerous small contracts as a further hedge on the purchase. This is certainly a luxury and risk that few can afford, especially in this environment. It's also a purchase strategy that appears to be far from normal at an overall point number that is so high.

My question is somewhat more practical, I hope: if a DVC owner purchases points direct (or even resale) and then chooses to make an additional direct add-on purchase to take advantage of an advertised, lower-per-point than base-price purchase, is there a duration of time that you must be an owner before this may be done?

For example, if my contract closed as a new owner in August 2020 and I wished to make a direct add-on purchase at a currently advertised and discounted add-on rate, when am I eligible to make that purchase? Immediately? After a period of time passes?

In my example, would I have been better served (in retrospect) to have purchased a larger amount of points at the time of my original, direct purchase, then sell some of my points if I later realize that my purchase was larger than needed? Or is it wise to make a smaller initial purchase, assess your needs in the short time with a visit, then add-on (if you prefer the direct route in this example) with a discounted add-on contract, assuming that discounts may still be available for the same resort in the near term?

I recognize that many users here prefer the resale add-on route, but for those considering a direct add-on, what is considered best practice?

Thank you!

You can buy direct any time. You can buy in August and then in October, whenever, no problem. If you want a lot of direct points, yes, it is best to purchase them all at once. Your price per point goes down if you buy larger quantities when going direct. Also, you pay less closing costs if you buy them all at once.

But... your best overall value is resale, no question. And your own resale value is best when you buy resale. If you buy direct and then need to sell your contract, you will lose money. If you buy resale and need to sell your contract, history has shown you will be able to sell your contract for what you bought it, sometimes more. You have no idea what life hold in store for you, why buy an asset with an unknown, unstable resale value, when you can buy the same type of asset with a stable resale value?

 

[JoeyPeligroso]

You can add on contracts with member discounts as soon as you are an owner,

I bought resale in 2009, and as soon as that contract closed and I got my membership number, I called and added on at BLT with member pricing. It was literally the day after I became a member.

Thank you! It's helpful to know that this may be done immediately following closing/membership number. It allows a new member to have some options relative to a direct add-on purchase in a very short time-frame. I presume that some new members would consider such an option to either increase points after a direct sale, buy at another resort using the member discount, or consider a direct purchase that would allow for the benefits of a blue-card?

 

[JoeyPeligroso]

Every resort except RIV has a known resale value. You can see exactly what they are going for right now. The difference is more for some than others.

No one knows what will happen with locked down RIV resale. I think the handful of sales that have gone through have been higher valued than anyone expected.

Long term, it’s smart to split your points into smaller contracts for a lot of reasons: inheritance, smaller contracts are easier to sell, they sell for more, maybe you want less points as kids get older...

Thank you! These are excellent points. The speculation involved with a RIV resale with respect to valuation would certainly appear to make a hasty sale after a purchase more challenging than some of the resorts that have a longer history of resale valuation.

When I made my purchase, I did choose to split points into smaller contracts...with advice from these forums as a guide. The resources here are really phenomenal, especially for someone who is considering a first time purchase or who is a new owner!

 

[JoeyPeligroso]

You can buy direct any time. You can buy in August and then in October, whenever, no problem. If you want a lot of direct points, yes, it is best to purchase them all at once. Your price per point goes down if you buy larger quantities when going direct. Also, you pay less closing costs if you buy them all at once.

Thank you! This is very true. It would also appear that in some circumstances a direct purchase of more than one resort may result in a combined purchase price that is lower as some promotional discounts may be combined - more than one resort purchased under the same promotion at the time of purchase. At least this option did appear to be available during the summer 2020 promotion. A combined purchase would also appear to be an option other than a later add-on.

For me, a combined initial purchase didn't make sense as a first-time buyer....just too much to consider with respect to my longer-term preferences on vacation stays. If I add-on at some point I will likely look at a resale option or a direct add-on with the member discount, depending on what makes the most sense at that time.

 

[disneykim17]

You can add on contracts with member discounts as soon as you are an owner,

I bought resale in 2009, and as soon as that contract closed and I got my membership number, I called and added on at BLT with member pricing. It was literally the day after I became a member.

Is this also true for the sold out resorts (example: AKV, BWV)? Also, how do you find out what the member discounts are?

 

[Sandisw]

Is this also true for the sold out resorts (example: AKV, BWV)? Also, how do you find out what the member discounts are?

They normally do not give member pricing on sold out resorts, The exception was this summer when they did offer them at a small level,

I wouldn’t expect them again as the current round of incentives eliminated them.

 

[disneykim17]

They normally do not give member pricing on sold out resorts, The exception was this summer when they did offer them at a small level,

I wouldn’t expect them again as the current round of incentives eliminated them.

Thank you

 

[dez1978]

You can buy direct any time. You can buy in August and then in October, whenever, no problem. If you want a lot of direct points, yes, it is best to purchase them all at once. Your price per point goes down if you buy larger quantities when going direct. Also, you pay less closing costs if you buy them all at once.

But... your best overall value is resale, no question. And your own resale value is best when you buy resale. If you buy direct and then need to sell your contract, you will lose money. If you buy resale and need to sell your contract, history has shown you will be able to sell your contract for what you bought it, sometimes more. You have no idea what life hold in store for you, why buy an asset with an unknown, unstable resale value, when you can buy the same type of asset with a stable resale value?

Boy this is the truth. We bought Riv direct at the end of January. We never in a million years expected that in just a few months 80% of our income would be gone due to COVID.

 

[we"reofftoneverland]

Boy this is the truth. We bought Riv direct at the end of January. We never in a million years expected that in just a few months 80% of our income would be gone due to COVID.

Very sorry to hear this. We have been lucky overall during this time but there have been work changes for both of us which makes the future less financially predictable than it was pre-Covid. These are really awful times. But our biggest concern is if one of us gets sick— all but one of our parents died relatively young- I know I wouldn’t want to hold onto dvc without dh. And dh wouldn’t want to keep it if something happened to me. He mostly goes because of me and I can’t see him messing around with any vacation that requires early booking or points. He is less detail oriented and wouldn’t even use it. It is a bit morbid to think this way, but I am hoping that in thinking this way nothing bad will ever happen. And I am not an overly cautious person, but for me, in instances where I can buy something that is almost the same with less risk associated, I am in. I do, however, get the draw of RIV and think it is a beautiful resort overall and love the long contract. I also think it is a good deal with the incentives, and we have looked very closely at buying it— it’s just the resale value that concerns us. DVC is a really joyful thing regardless. I hope you can hold onto your contract or buy back in at a later date. But yes, unfortunately, there are so many unplanned things that can happen in life. It is a wild ride.

 

[JoeyPeligroso]

They normally do not give member pricing on sold out resorts, The exception was this summer when they did offer them at a small level,

I wouldn’t expect them again as the current round of incentives eliminated them.

Just to add to this comment, the member pricing is something that can be communicated by your DVC Guide. This summer, many of the discounts were also posted on the forums here. Not all of the sold-out resorts were offered at a discount this past summer (to my recollection); however, there were some pretty unique offers.

 

[JoeyPeligroso]

Very sorry to hear this. We have been lucky overall during this time but there have been work changes for both of us which makes the future less financially predictable than it was pre-Covid. These are really awful times. But our biggest concern is if one of us gets sick— all but one of our parents died relatively young- I know I wouldn’t want to hold onto dvc without dh. And dh wouldn’t want to keep it if something happened to me. He mostly goes because of me and I can’t see him messing around with any vacation that requires early booking or points. He is less detail oriented and wouldn’t even use it. It is a bit morbid to think this way, but I am hoping that in thinking this way nothing bad will ever happen. And I am not an overly cautious person, but for me, in instances where I can buy something that is almost the same with less risk associated, I am in. I do, however, get the draw of RIV and think it is a beautiful resort overall and love the long contract. I also think it is a good deal with the incentives, and we have looked very closely at buying it— it’s just the resale value that concerns us. DVC is a really joyful thing regardless. I hope you can hold onto your contract or buy back in at a later date. But yes, unfortunately, there are so many unplanned things that can happen in life. It is a wild ride.

I think DVC is a very joyful thing for sure!

With so many recent financial challenges, it is a blessing that there is value retained in a former DVC purchase. For those who are unexpectedly burdened by their DVC purchase or are having an unanticipated financial challenge, certainly the differential in purchase price vs. sale price can be a loss with respect to DVC as an asset - a loss which would favor those who made a resale purchase to begin with.

On the plus side, at least there is retained value in a former DVC purchase and a current market for sales of that asset, which is not always the case in a timeshare purchase.

 

[E2ME2]

Boy this is the truth. We bought Riv direct at the end of January. We never in a million years expected that in just a few months 80% of our income would be gone due to COVID.

WOW- I hope you have recovered from this set back, and hope you get to use DVC the way you had planned.
ET

 

[dez1978]

WOW- I hope you have recovered from this set back, and hope you get to use DVC the way you had planned.
ET

Thank you. We did have some savings and we will be ok. It’s just so hard to watch what we’ve worked so hard to build (restaurant) go down the drain so quickly

 

[JoeyPeligroso]

Thank you. We did have some savings and we will be ok. It’s just so hard to watch what we’ve worked so hard to build (restaurant) go down the drain so quickly

My thoughts are with you!

 

[E2ME2]

Thank you. We did have some savings and we will be ok. It’s just so hard to watch what we’ve worked so hard to build (restaurant) go down the drain so quickly

WOW - Restaurants have been extremely hard hit through this crisis. May I ask where your restaurant is, and the name ??
They just closed a favorite restaurant of ours, in Maryland, that had been a family run ICON in our area for about 60 years.
I've been trying to support local restaurants, and have been dining al-fresco, but colder weather is going to impact that really soon.
Definitely hoping you can bounce back from this even better & stronger than before.......

 

[dez1978]

WOW - Restaurants have been extremely hard hit through this crisis. May I ask where your restaurant is, and the name ??
They just closed a favorite restaurant of ours, in Maryland, that had been a family run ICON in our area for about 60 years.
I've been trying to support local restaurants, and have been dining al-fresco, but colder weather is going to impact that really soon.
Definitely hoping you can bounce back from this even better & stronger than before.......

We have a franchise of a buffet chain. I am overly paranoid about what personal info I give out on the internet because my husbands credit was hacked this year as well (2020 has been THE WORST), so please don't think I'm being rude by not sharing particulars. Its been particularly rough on buffets, just due to the nature of them and the whole self serve thing. And I completely get it. I get why people are uncomfortable going to them and I get why there are more stringent regulations on them (such as them being served cafeteria style etc). I understand the need to eliminate touch points from the general public, so staff are the only ones touching utensils and plates etc. It makes perfect sense. So I hope no one thinks I'm complaining about the restrictions. Its just that the added labor costs and fewer guests bc of social distancing, is just one more layer added to an already difficult situation.

Thank you for the good vibes, and everyone else who has commented as well.

 

[DebLovesPooh]

We have a franchise of a buffet chain. I am overly paranoid about what personal info I give out on the internet because my husbands credit was hacked this year as well (2020 has been THE WORST), so please don't think I'm being rude by not sharing particulars. Its been particularly rough on buffets, just due to the nature of them and the whole self serve thing. And I completely get it. I get why people are uncomfortable going to them and I get why there are more stringent regulations on them (such as them being served cafeteria style etc). I understand the need to eliminate touch points from the general public, so staff are the only ones touching utensils and plates etc. It makes perfect sense. So I hope no one thinks I'm complaining about the restrictions. Its just that the added labor costs and fewer guests bc of social distancing, is just one more layer added to an already difficult situation.

Thank you for the good vibes, and everyone else who has commented as well.

We are thinking of you and I’m so glad you and your family will be ok!