Cons of Buying DVC Resale

Cons of Buying DVC Resale: Understanding the Trade-offs

While buying DVC through resale offers significant cost savings, prospective buyers should understand the drawbacks and limitations before committing. A balanced view of resale disadvantages helps you make an informed decision.

Resale Restrictions on Benefits

The most significant disadvantage of buying resale is Disney's restrictions on supplementary membership benefits. Depending on when your contract was originally purchased, resale ownership may exclude you from programs like Member Getaways, Disney Collection options, and certain discounts.

These restrictions mean resale owners cannot use points for non-DVC accommodations, cruise vacations through Disney Collection, or Adventures by Disney trips. If these options would enhance your vacation planning, resale restrictions represent a meaningful limitation.

It's important to note that Disney Vacation Club has implemented these restrictions in phases. Contracts purchased after a certain date may have different limitations than older contracts. Therefore, understanding the specific terms of the resale contract you're considering is crucial.

Limited Add-On Options

Resale owners cannot purchase additional points directly from Disney unless they first make a minimum direct purchase. This limits your ability to expand your holdings at sold-out resorts or add points with full membership benefits attached.

If you anticipate wanting more points in the future, this restriction could affect your long-term membership strategy. You can always purchase additional resale contracts, but direct add-on flexibility is not available without meeting Disney's direct purchase requirements.

Moreover, the availability of points at your preferred resort may be limited, especially if it's a popular location. This can make it challenging to secure the accommodations you desire during peak times.

ROFR Uncertainty

Disney's Right of First Refusal (ROFR) introduces uncertainty into resale transactions. After agreeing on terms with a seller, Disney may exercise ROFR and purchase the contract instead of allowing it to transfer to you. This uncertainty extends the purchase timeline and creates potential disappointment.

ROFR exercise is especially frustrating when you have found a contract that perfectly matches your needs. Starting over with a new search and offer process delays your path to membership. While most contracts pass ROFR, the possibility of exercise creates inherent risk in resale purchases.

Typically, Disney exercises ROFR based on specific market conditions and internal criteria, which are not publicly disclosed. This means buyers need to be prepared for the possibility of starting their search anew.

Extended Purchase Timeline

Resale transactions take significantly longer than direct purchases. The typical 60 to 90 day timeline from offer to membership includes ROFR review, title work, closing, and Disney registration. Direct purchases through Disney complete much faster with immediate membership activation.

If you want to use your membership quickly for upcoming vacation plans, the resale timeline may not accommodate your schedule. Planning vacations around an uncertain closing date requires flexibility that not all situations allow.

Additionally, factors such as the efficiency of the broker, title company, and the responsiveness of the seller can influence the timeline. It's advisable to work with experienced professionals to help streamline the process.

No Financing Through Disney

Disney offers financing options for direct purchases that are not available for resale transactions. If you need financing to purchase DVC, you must arrange it through personal loans, home equity products, or other consumer financing options.

These alternative financing sources may have higher interest rates or less favorable terms than Disney's promotional financing. The total cost of ownership could be affected by financing differences when comparing resale versus direct options.

Buyers should carefully evaluate their financing options and consider the long-term financial implications of their choice. Consulting with a financial advisor can help determine the best approach based on individual circumstances.

Complexity of Transaction

Resale transactions involve multiple parties and more complex processes than direct purchases. Working with brokers, title companies, and navigating ROFR adds layers of coordination that direct purchases avoid. Some buyers prefer the simpler direct purchase experience.

Understanding resale processes requires more research and engagement than walking into a Disney sales presentation. The savings justify this effort for many buyers, but the complexity is a legitimate consideration for those who value simplicity.

Potential buyers should be prepared to invest time in learning about the resale process, including contract terms, fees, and other considerations unique to the resale market.

Due Diligence Requirements

Buying resale requires more buyer due diligence than direct purchases. Verifying contract details, evaluating brokers, understanding point status, and reviewing transaction documents all require attention. Mistakes in the resale process can have financial consequences.

Direct purchases from Disney provide standardized contracts with Disney's backing. Resale transactions, while generally safe with reputable brokers, require buyers to take responsibility for evaluating what they are purchasing.

Buyers should conduct thorough research on the resale market, consult with experienced brokers, and carefully review all documentation to ensure a smooth transaction.

Weighing the Trade-offs

For most buyers, the substantial cost savings of resale outweigh these disadvantages. However, your individual situation determines whether resale makes sense. Consider which specific limitations matter for your vacation plans and whether the price difference justifies accepting them.

Understanding both the benefits and drawbacks of resale empowers informed decision-making. Neither option is universally better; the right choice depends on your priorities, budget, and how you plan to use your DVC membership.

Ultimately, the decision to purchase DVC resale should align with your long-term vacation goals and financial strategy. By carefully evaluating the pros and cons, you can make a choice that enhances your Disney vacation experiences.