DVC Financing Approval

[mcwarriors2012]

Hey Everyone,

We recently sent in all our paperwork to Disney on Friday. We are totally new to this, and we were just wondering how hard it is to get "approved." Our host person said that we were approved, but now he says that this paperwork is the formal approval and we have to wait and see. Our credit is not great, but I mean we don't have any bankruptcies or anything like that, just a few loans. Do we have a good chance of being approved?

 

[salvy72]

All applicants are approved. Most state laws allow everyone who is eligble for the presentation and gifts to be financed. Hence the astronomical interest rate. Some companies finance in house, so defaults can be resold over and over and over. Good luck! Book early and get the best room! Don't pony up anymore money and if they ask for anything else, push for more bonus points. If you don't ask, you won't get anything.

 

[mcwarriors2012]

What do you mean? Ask for more points? So if they say pay more money up front tell them no? Can u do that? I mean won't we be denied if we don't comply?

We are looking at a trip maybe in august, the guy said as soon as we get our member number we can book.

We are already paying the 15% interest. We bought 260 points at AKV and getting 300 from the promotion.

 

[DebbieB]

I have heard they sometimes ask for a higher downpayment for those with credit problems. I doubt they will give you more bonus points as a result.

 

[mcwarriors2012]

ya i bet that is wha they will do with us. I mean my credit isn't horrible. But its not great either. But you think we have a good shot at being approved?

 

[DebbieB]

ya i bet that is wha they will do with us. I mean my credit isn't horrible. But its not great either. But you think we have a good shot at being approved?

Do you have collectors chasing after you? If not, you should get approved iwth no problem. It's pretty low risk for DVC, if you don't pay they foreclose and take it back.

 

[mcwarriors2012]

well ya we do have collectors but nothing major. I don't have credit cards. Just like electric bill, mace's card. that sort of thing.

 

[mcwarriors2012]

i forgot to ask, how long does it usually take for them to approve you? like how long before u hear back?

 

[magicaldisney]

If you have collectors chasing you then I would pay them off first with the money you were going to use to purchase DVC. If you are going to pay out monthly for the loan and maintenance fees why not wait until after you pay your outstanding bills. DVC will always be there.

 

[dwelty]

Disregard Salvy72. If you notice he has one post to his name, and is obviously unfamiliar with DVC. There is no chance that they will kick in with additional points above and beyond the incentive. Also what does he mean by book early to get good avalibility? if this is a dig on avalibility within the DVC system, that wont fly, there is avalibility this week at several resorts and summer has begun. This has nothing to do with your question.

There are 2 interest rate levels, one is about 11% for good credit the other is about 15% for marginal credit. I would imagine that they will approve you for one or the other.

 

[disneynutz]

One major item that people who make this luxury purchase don't think about is what the true costs are.

In addition to the down payment, high interest, and principle payment, your dues will be around $1,800 next year and it increases each year.

You need to come up with a few thousand dollars for each yearly vacation for travel, food, admission, and extras.

DVC isn't cheap!

Bill

 

[DizBub]

One major item that people who make this luxury purchase don't think about is what the true costs are.

In addition to the down payment, high interest, and principle payment, your dues will be around $1,800 next year and it increases each year.

You need to come up with a few thousand dollars for each yearly vacation for travel, food, admission, and extras.

DVC isn't cheap!

Bill

These are all true observations and should be considered in your decision. Only you know what your finances are and what you can and cannot afford.

That said, I'm sure you will be approved and it will probably be the easiest purchase you've ever made. Good luck.

 

[ELMC]

What do you mean? Ask for more points? So if they say pay more money up front tell them no? Can u do that? I mean won't we be denied if we don't comply?

We are looking at a trip maybe in august, the guy said as soon as we get our member number we can book.

We are already paying the 15% interest. We bought 260 points at AKV and getting 300 from the promotion.

With all due respect, if you are in a position where you are worrying about whether or not you qualify and are going to pay a 15% interest rate, perhaps you should reconsider this purchase. Based on the information you have provided in this thread, purchasing DVC at this time does not sound like a wise move. In addition to the purchase price that you are financing, there are significant maintenance fees as well as the cost of the vacation itself. If your situation changes for the worse even a little bit, you won't be able to get anything close to what you paid for these points and it will be a loss situation. Furthermore, with the 15% interest rate, any savings that you might have realized by purchasing DVC will be erased.

I understand that this is something that you want, but take a minute to consider if this is the best decision for you at this time. At the very least, look into buying a DVC contract via the resale market where prices are up to 60% off of direct pricing. Good luck.

 

[AllieV]

Slightly off topic, but if I'm doing the math right, 260 paid points at $135 pp at 15% interest for 10 years plus $5.40 pp in dues on 300 points is a monthly payment (assuming no down payment) of $701 per month. For 10 years. Not counting increases in dues. Yowza. For $700 per month, I want more than a 1-br for a week per year.

 

[ELMC]

OP, I wonder if you've taken the time to really analyze the numbers.

To put it another way, the purchase price for your 300 points is $33,800 (assuming a $130pp cost on 260 points). The interest you will be paying over the next 10 years (assuming a 13.99% rate) is $29,151.68. That effectively doubles the purchase price. Think of how many vacations you could take over the next 10 years for $29,000 instead of paying it in finance charges. I don't know about you, but I find these numbers to be incredibly scary. I'm not trying to disrespect you or your decision, I just wanted to point out some of the details that your salesperson may have overlooked as he was busy sprinkling pixie dust all over the room.

 

[Missyrose]

OP, I wonder if you've taken the time to really analyze the numbers.

To put it another way, the purchase price for your 300 points is $33,800 (assuming a $130pp cost on 260 points). The interest you will be paying over the next 10 years (assuming a 13.99% rate) is $29,151.68. That effectively doubles the purchase price. Think of how many vacations you could take over the next 10 years for $29,000 instead of paying it in finance charges. I don't know about you, but I find these numbers to be incredibly scary. I'm not trying to disrespect you or your decision, I just wanted to point out some of the details that your salesperson may have overlooked as he was busy sprinkling pixie dust all over the room.

To put things even more in perspective, if OP had to sell his points, he would only get about $21,000 for them and that's a very generous estimate at $70 per point, though many AKV contracts are now selling (and passing ROFR) in the 60s.

If you need to pay for vacations monthly, why don't you open a savings account and make payments to yourself each month? Then you can build up some savings and buy a contract via resale or you can book a Disney trip and be able to pay it off immediately. Just because Disney makes getting their loans easy, doesn't mean you should. I hope OP takes the advice of the PPs and rethinks this decision.

 

[Lynne M]

Someone may have already mentioned this, but OP, why not just rent points? You get to stay in the same villas, but without the commitment to pay thousands of dollars a year, whether you can go to WDW that year or not.

A lot of people have the wrong impression of what DVC is...it's not some special club that gets you special things that no one else can get. It's just a way of pre-paying for your lodging. The same lodging you can get by booking through Disney, or by renting from an owner.

For some people, it's worth it. But you're already overpaying by thousands of dollars by buying direct from DVC, and then to add those massive finance charges on top of it is just throwing away tens of thousands of dollars. There won't be much if any savings for you doing it this way, and in fact, you may end up paying MORE for your lodging by buying DVC.

 

[AllieV]

Someone may have already mentioned this, but OP, why not just rent points?

Oh, good point. Renting 300 points a year at the highest price of $13 (they do go lower) is $325 per month, as opposed to the $700 per month to buy those points. Put away the difference and in about 3-1/2 years you'll have the cash to buy those points resale.

Sorry, OP, this wasn't your original question. You didn't come on here to be swayed a different direction. You may have the cash flow for $700 a month and if so, then I wish you well.

Another financing option is the timeshare store. Get the cheaper points resale and do their financing at 12% (?). From what I remember on other threads, they only require a 580 credit score or something.

 

[dwight16]

No offense but you are making a horrible mistake borrowing money at that rate to buy a time share is probably one of the worst financial mistakes you could ever make. If you don't own a home and cant take advantage of extreamly low rates on Lines of credit. my lord get the Disney credit card and i think the rate would be cheaper. at 700 a month you can use that 8,400 dollars a year to plan the craziest Disney vacation ever each year. i get it its fun to own these things i love it but no reason to waste money.

 

[AllieV]

my lord get the Disney credit card and i think the rate would be cheaper.

I doubt you can put 30k on a credit card. A resale would go for about $15k-$16k but that's still a high credit line you would need.