[2nd Star]

I found this on another board

For the past several years, the Disney Vacation Club has required a minimum downpayment of 10% on all point purchases. Recent changes to the application of promotional incentives has reduced the initial cash outlay.

Previously the downpayment was a fixed 10% of the base price of the points being purchased. Promotional incentives were deducted from the balance due. A purchase of 160 vacation points at the base rate of $104 per point would require a minimum downpayment of $1,664 (160 x $104 x 10%) plus closing costs. Promotional discounts (currently $8 per point) would then be deducted from the remaining balance.

In the above example, the buyer would be required to pay $1,664 plus fees out of pocket with an additional $1.280 reduction coming as part of the incentive. The remaining balance of $13,696 could then be financed over as long as 10 years.

DVC has now changed the math for buyers at Disney's Animal Kingdom Villas. As part of the new calculation, the promotional incentives contribute to the downpayment. Using the above example, the $1,664 required downpayment is now being reduced by the $1,280 incentive. Including closing costs, a new member can finance a DVC purchase for as little as $500 out of pocket. The amount may be larger for purchases greater than 160 points.

Note that this revised calculation will result in a higher principle amount financed, high monthly payments and high total interest paid over the life of the loan.

[Daisee]

Hmm.. that would be nice.

[cinderbella]

Do you think because of the economy DVC is lowering it's prices? I wonder if they are feeling the pinch as well?

[E&B's Mom]

It's not really lowering the cost, just applying the incentives differently to allow for a smaller down payment. In the end the total cost is actually more, since you're financing more and will be making larger payments.

[Dopey]

My feeling is, if you have to finance it, you can't afford it. No matter how they twist the numbers and incentives. Right?

[Experiment6-2-6]

Originally Posted by Dopey

My feeling is, if you have to finance it, you can't afford it. No matter how they twist the numbers and incentives. Right?

Oh, aren't we the mood killer....
Of course I can't afford it.. But it's only $500.00 down!

Sadly, all this does is tease me...

[Dopey]

Originally Posted by Experiment6-2-6

Oh, aren't we the mood killer....
Of course I can't afford it.. But it's only $500.00 down!

Sadly, all this does is tease me...

Mood killer? you ain't seen nothin' yet, babeeeee

See, that's exactly what they want to accomplish

[sue299]

Originally Posted by Dopey

My feeling is, if you have to finance it, you can't afford it. No matter how they twist the numbers and incentives. Right?

you know what, I tend to feel this way too. My trips are paid for before I go (I mean credit card they were charged on are paid for ) and I have my cash for spending - I'll put my purchases on my Disney visa to get the points but pay it off when I get home.

I can seem to enjoy the vacation more when I don't have to worry about can I really afford it.

[Daisee]

Originally Posted by Dopey

My feeling is, if you have to finance it, you can't afford it. No matter how they twist the numbers and incentives. Right?

I tend to agree with Dopey.

I also agree that you are not saving any money, and actually paying more in the end. BUT.. I can see it helping those truly interested get in the door easier.. hopefully with the intention of paying it off fast.

[Prezcatz]

I definitely think this is a way to get more people in the door, signed, etc. I know the downpayment was one reason of many we waited to buy DVC, but allowing someone to take the discount against the downpayment would have allowed me to buy sooner. Yes, you do end up paying more in the long run by having a higher principal loan amount, but it does go to the way that most things are today of "no money down" or "six months interest free" kind of pay-it-later mentatlity we as a society have today.

Prezcatz Paul

[WishUponAStar]

Hmm, I guess it makes it more accesible to more people but I tend to agree that the more you finance the package the more it's gonna cost you in the end (big time) and that's never a good thing. Then again, whatever, I bet a large percentage of DVC members finance and live with it. Either way, I guess it's a nice break for people. It doesn't seem like that much of a break though, I wonder where this came from or why they decided to do it.

[mickeysgirlz]

When I spoke to a DVC CM, they said that most people finance because of the tax benefits? That you technically own a "second home" and it can be written off as such? Is this true?

[momofaprincess]

Originally Posted by mickeysgirlz

When I spoke to a DVC CM, they said that most people finance because of the tax benefits? That you technically own a "second home" and it can be written off as such? Is this true?

This is what our guide told us too. It was a good reason for us to finance too. Plus our loan amount is smaller since we didn't have to buy in with many points. Although we have every intention on paying it off early, financing through Disney made our dream happen a little sooner than we could have made it happen (we DID have to put down 10% though then they added incentives to that and it lowered our total amount financed)

It's almost like financing a car except this will last a WHOLE lot longer.

[DVC Mike]

Originally Posted by mickeysgirlz

When I spoke to a DVC CM, they said that most people finance because of the tax benefits? That you technically own a "second home" and it can be written off as such? Is this true?

Yes, as long as you don't already have a second home, you can deduct the interest on the loan and the portion of your annual dues that are property taxes. Of course, consult your tax professional.

[Remy]

Originally Posted by cinderbella

Do you think because of the economy DVC is lowering it's prices? I wonder if they are feeling the pinch as well?

I thought the same thing!!!!!!!!