Davids DVC: Rental reimbursement or rescheduling?

[fsjking]

Not extortion at all. This is only in the case where owner has good cause to believe that David's won't honor contract. Owner can cancel reservation, sell it to someone else, ask renter to make up the difference from David's, etc. Owner does have to return the funds it received though, but other than that can do whatever it wants to make itself whole or mitigate the damages.

extortion
Pronunciation /ikˈstôrSH(ə)n/ /ɪkˈstɔrʃ(ə)n/
NOUN

• The practice of obtaining something, especially money, through force or threats.

You can call David's and say you want paid what the contract stipulates. You cannot contact the renter and ask for more. You are threatening to cancel their reservation if they don't pay more than the contract that you signed agreed to. It's extortion. Period.

I think you misinterpreted what I was saying. No, I'm not going to pull the rug out from anyone. Because I have a second renter, the broker needs to keep me "happy", right? On the second rental, well I have no leverage. I also indicated that if I have to, I will take a hit on the 30%. Please read my post again - maybe I was not articulate, but I have always been a good negotiator and expect that a phone call, if needed would at least get October paid in full. Sorry again if my post was unclear.

My reply was to the person that replied to you about reviewing the later contracts and using them to get payment for the earlier contract. My comments really had nothing to with what you are planning.

 

[MICKIMINI]

extortion
Pronunciation /ikˈstôrSH(ə)n/ /ɪkˈstɔrʃ(ə)n/
NOUN

• The practice of obtaining something, especially money, through force or threats.

You can call David's and say you want paid what the contract stipulates. You cannot contact the renter and ask for more. You are threatening to cancel their reservation if they don't pay more than the contract that you signed agreed to. It's extortion. Period.



My reply was to the person that replied to you about reviewing the later contracts and using them to get payment for the earlier contract. My comments really had nothing to with what you are planning.

Thanks for clarifying...I'm getting sensitive and stressed out and ready to GIVE away all my points in anticipation of any rentals I was possibly thinking about, maybe sometime in the future...no for free, no I'll pay them...just take me out of this situation please - sigh...!

 

[fsjking]

Thanks for clarifying...I'm getting sensitive and stressed out and ready to GIVE away all my points in anticipation of any rentals I was possibly thinking about, maybe sometime in the future...no for free, no I'll pay them...just take me out of this situation please - sigh...!

Don't stress yourself out. This whole thing is a bad deal on many levels. This DVC stuff is the least of our worries right now.

 

[MICKIMINI]

So true. My son and nephew are face to face with patients every day

EDIT: I need a diversion and since the gym is closed and I have cleaned all the baseboards...

 

[Sandisw]

Please reread my post. I am willing to give up the 30%. Apparently I am not articulate - sorry!

My post wasn’t in response to you. It was in response to someone else! I didn’t take your post as not following through. It was clear to me,

I think we all have quarantine brain and are getting everyone mixed up!Lol

 

[Jetku]

This is all unfortunate because we just passed ROFR with about 200 points (mostly banked) on 2020 UY that we planned to rent out to offset the cost.

Sorry if I don’t understand all the dynamics here - is timeshare store in a similar quandary or is it just David’s for some reason?

David’s is who I planned to use, but obviously now am unsure of what we will do.

 

[Sandisw]

This is all unfortunate because we just passed ROFR with about 200 points (mostly banked) on 2020 UY that we planned to rent out to offset the cost.

Sorry if I don’t understand all the dynamics here - is timeshare store in a similar quandary or is it just David’s for some reason?

David’s is who I planned to use, but obviously now am unsure of what we will do.

Good question. I don’t know about the wording of that contract and whether it has a clause about things like resort closure.

The issue here is that this brokers contracts do not. So, none of the three party’s involved were the ones who closed the resort.

Whatever you decide to do, I think we have all learned that any contract needs to include this so all parties are clear as to the remedy should it happen again.

 

[Deb & Bill]

This is all unfortunate because we just passed ROFR with about 200 points (mostly banked) on 2020 UY that we planned to rent out to offset the cost.

Sorry if I don’t understand all the dynamics here - is timeshare store in a similar quandary or is it just David’s for some reason?

David’s is who I planned to use, but obviously now am unsure of what we will do.

Everyone who is acting as a broker is in a similar position. The Timeshare Store is acting as a broker if they are finding you a renter to rent your points and they pay you.

 

[MICKIMINI]

You can make one "transfer" to another member per year - but you have to find the member and arrange the transaction. You can "gift" a reservation or reservations - a great wedding gift, etc. if timing works out! I believe you can also put it toward RCI. It's not what you expected but if you get creative you might salvage some value!

 

[Dracula]

extortion
Pronunciation /ikˈstôrSH(ə)n/ /ɪkˈstɔrʃ(ə)n/
NOUN

• The practice of obtaining something, especially money, through force or threats.

You can call David's and say you want paid what the contract stipulates. You cannot contact the renter and ask for more. You are threatening to cancel their reservation if they don't pay more than the contract that you signed agreed to. It's extortion. Period.



My reply was to the person that replied to you about reviewing the later contracts and using them to get payment for the earlier contract. My comments really had nothing to with what you are planning.

When a landlord asks for overdue rent to be paid under threat of eviction, I would not think this is extortion. In this particular case, assuming David's defaults on the first rental contract, I can see how one can think that all subsequent renters are not to blame, and I would really like for them to continue on with their vacations. At the same time, once David's is in default on one contract, he is likely to default on all contracts; if the owner cancels the reservations and informs the renter, the renter then has a choice to pursue credit card chargeback against David's to recover their money, and may choose to rent again; following this, David's or its creditors would follow up with the owner to recover their payment, minus of course the 30% from the first rental contract. I understand this is complicated, but would not think all owners are ready to assume thousands of dollars in losses due to David's default.

In a recent bankruptcy last week of OTA bookit.com, many guests were asked to pay their bills upon resort check-out, after they have already prepaid on bookit. Would they have not paid that, the resorts threatened to call the police and get them arrested. This does not count as extortion, since the resort / owner simply asked for the delivered services to be paid for, once the intermediary / bookit defaulted.

In another twist, it's well known that once you default on a credit card or loan, other credit cards with the same bank would be closed, or start charging punishing interest rates. But also, other banks may cancel credit cards even with those banks you made all payments in full. This brings the question, should an owner even wait for David's to default on the first rental agreement, or can it be assumed that a reported default on any rental agreement means David's would now be in default on all other agreements? I guess each owner would decide for themselves - some may choose to save the hassle and let the reservations go through, others may reach out to renters, yet others may outright cancel. Hopefully David's does not default and this is all moot.

 

[KingRichard]

Question?

How many reservations do you think David's made in the 30 days this has/will last?

How many of those will lose points that have expired?

I like David's and have used them 3 times and have more points to rent out before this happened.

David's is popular, but how big is it?

If Disney does give back points(not expired), then I think most people will want to work with David's to rent them out again. You didn't need them in the first place and as time goes by they become less valuable.

I just wonder if we are making more out of this then what is really going on? I figured that we will lose the 30% on less then 200 points for May and we can live with that.

I don't know? Maybe David's has rented 100,00 points and 20% will expire? I sure hope not!

 

[CraigInPA]

This brings the question, should an owner even wait for David's to default on the first rental agreement, or can it be assumed that a reported default on any rental agreement means David's would now be in default on all other agreements?

If you are in this situation, and paranoid about losing the 30%, I suggest you call David's and have a discussion with them to ensure you will get paid. I would not preemptively cancel a reservation, and pay back the amount you've received, based solely upon something you read on the Internet about the company not paying.

 

[Sandisw]

Question?

How many reservations do you think David's made in the 30 days this has/will last?

How many of those will lose points that have expired?

I like David's and have used them 3 times and have more points to rent out before this happened.

David's is popular, but how big is it?

If Disney does give back points(not expired), then I think most people will want to work with David's to rent them out again. You didn't need them in the first place and as time goes by they become less valuable.

I just wonder if we are making more out of this then what is really going on? I figured that we will lose the 30% on less then 200 points for May and we can live with that.

I don't know? Maybe David's has rented 100,00 points and 20% will expire? I sure hope not!

Someone mentioned he has 40 employees. A company that big has to have a strong customer base with lots of rentals.

Plus, IMO, if he is holding back the 30% for those during the 2 weeks closure...which is what is being reported.. it has to be more than he can absorb.

I think it’s a substantial amount which is why his first stance was to try and get as many renters rescheduled that was possible, before he had to take steps that would upset both renters and owners.

 

[RaymOOOnd]

David's is free to stick to their strict cancellation policy without making concessions.
But I think this will make many-a-person think twice about using them again.
For that reason, if I were them, I'd be trying my hardest to find some structured way of working with the members, trying to reschedule those that can be rescheduled, etc. The "not my problem" approach wouldn't inspire confidence.

 

[Sandisw]

David's is free to stick to their strict cancellation policy without making concessions.
But I think this will make many-a-person think twice about using them again.
For that reason, if I were them, I'd be trying my hardest to find some structured way of working with the members, trying to reschedule those that can be rescheduled, etc. The "not my problem" approach wouldn't inspire confidence.

Or, he has sought legal advice that has lead him to create the solutions he has?

 

[fsjking]

When a landlord asks for overdue rent to be paid under threat of eviction, I would not think this is extortion. In this particular case, assuming David's defaults on the first rental contract, I can see how one can think that all subsequent renters are not to blame, and I would really like for them to continue on with their vacations. At the same time, once David's is in default on one contract, he is likely to default on all contracts; if the owner cancels the reservations and informs the renter, the renter then has a choice to pursue credit card chargeback against David's to recover their money, and may choose to rent again; following this, David's or its creditors would follow up with the owner to recover their payment, minus of course the 30% from the first rental contract. I understand this is complicated, but would not think all owners are ready to assume thousands of dollars in losses due to David's default.

In a recent bankruptcy last week of OTA bookit.com, many guests were asked to pay their bills upon resort check-out, after they have already prepaid on bookit. Would they have not paid that, the resorts threatened to call the police and get them arrested. This does not count as extortion, since the resort / owner simply asked for the delivered services to be paid for, once the intermediary / bookit defaulted.

In another twist, it's well known that once you default on a credit card or loan, other credit cards with the same bank would be closed, or start charging punishing interest rates. But also, other banks may cancel credit cards even with those banks you made all payments in full. This brings the question, should an owner even wait for David's to default on the first rental agreement, or can it be assumed that a reported default on any rental agreement means David's would now be in default on all other agreements? I guess each owner would decide for themselves - some may choose to save the hassle and let the reservations go through, others may reach out to renters, yet others may outright cancel. Hopefully David's does not default and this is all moot.

The landlord example is not the same. You are behind on payments you contracted to make. A comparable example would be you made your on time $1000 rent payment then the landlord says that you have to pay another $300 or he's going to evict you immediately. He can't legally do that.

I think the resorts in the bookit situation would have probably lost in court if they had guests arrested. Even making that threat is sketchy. They would have had an obligation to inform the guest prior to check in. If they did and the guest still stayed, then that's on the guest. While I agree they are similar situations, there is some differences as the resorts did not receive any payment, where the DVC owners have received 70%. In this case, the DVC owner could choose to cancel the reservation, send the money back to David's and then inform the guest of the cancellation. They cannot, however, call and ask for more money under the threat of cancellation. There's a difference there.

The credit card industry has long been full of double standards and dubious practices. You might as well cite examples of loan sharks and mob bosses. We all use them, but they will screw you over and get away with it every time.

One thing to remember in all of this is the renter did nothing wrong and paid up front. There is nothing they can do to screw you over in regards to this. Any issue you have is with the intermediary and you should pursue your issues with them. Calling them up and saying you expect to be paid for previous rentals and may consider cancelling further rentals has a much stronger legal standing than calling the renter who had nothing to do with you not getting paid on someone else's reservation.

David's is free to stick to their strict cancellation policy without making concessions.
But I think this will make many-a-person think twice about using them again.
For that reason, if I were them, I'd be trying my hardest to find some structured way of working with the members, trying to reschedule those that can be rescheduled, etc. The "not my problem" approach wouldn't inspire confidence.

That's all assuming that they aren't just rearranging deck chairs on the Titanic. They may know they are done in this industry and are just trying to find a way not to end up personally bankrupt. You have to remember, they really didn't do anything wrong here other than having a contract that didn't consider resort closures and not setting up escrow accounts to make sure the money was protected. They are probably dealing with chargebacks they have no say in and owners refusing to work with them. I can sympathize with their situation. They are going to lose in this no matter what.

 

[Dracula]

If you are in this situation, and paranoid about losing the 30%, I suggest you call David's and have a discussion with them to ensure you will get paid. I would not preemptively cancel a reservation, and pay back the amount you've received, based solely upon something you read on the Internet about the company not paying.

Thank you for the advice - not feeling paranoid about this issue, just trying to think one step ahead, when other people lose their lifetime savings in their 401ks, I am sure many owners would be fine missing out on a few rental dollars. Everyone would need to make sacrifices here, and few would go out unscathed.
I am yet to see reports of owners not getting paid the 30%, and would rather not call as I am sure their inbox is full, and the website specifically asks owners to wait to be contacted. Hopefully the DVC resorts all open on April 1st and David's will remain an ongoing concern - but the odds of that are not looking good. At this point, I would expect the resorts to stay closed through May 15th (~8 weeks, similar to China), and David's to be in a cash-constrained position by April 15th - but, as a famous president said, it is just my hunch.

 

[Sandisw]

Thank you for the advice - not feeling paranoid about this issue, just trying to think one step ahead, when other people lose their lifetime savings in their 401ks, I am sure many owners would be fine missing out on a few rental dollars. Everyone would need to make sacrifices here, and few would go out unscathed.
I am yet to see reports of owners not getting paid the 30%, and would rather not call as I am sure their inbox is full, and the website specifically asks owners to wait to be contacted. Hopefully the DVC resorts all open on April 1st and David's will remain an ongoing concern - but the odds of that are not looking good. At this point, I would expect the resorts to stay closed through May 15th (~8 weeks, similar to China), and David's to be in a cash-constrained position by April 15th - but, as a famous president said, it is just my hunch.

There are confirmed posts elsewhere that owners have indeed been told they are not getting it for the reservations that were to check in during the closure

 

[davper]

Because he may have used those proceeds to pay his staff?
Would be surprised if David is not, at this very moment, dipping into the 30% payments retained for owners to compensate renters. Would that make his business a pyramid scheme?

Guessing most of this will be figured out by a bankruptcy trustee. Long-term resort closures are the one thing he never counted on in putting together these contracts. He is in trouble from both sides. The upcoming second wave of closures will be brutal for him.

This then puts into doubt any future contracts, when everything is back up and running, where he is unable to pay the 30% to owners upon check-in.

Not a pyramid scheme, but clearly a desperate measure which relies upon future income to pay debts from today. A lot of businesses operate this way, relying upon their creditors to practice forbearance in getting paid in a timely manner. The challenge here is that such a scheme will require David's to earmark a portion of future proceeds to clean up the accumulated liability of this, which may jeopardize his ability to pay staff and other bills. The other issue here is that it relies upon DVC members to believe that he is financially solvent and that future rentals will be paid on time and in full. If that confidence is broken, the whole thing will collapse like a house of cards.

I am willing to bet that David's has Business Interruption insurance (Not sure it applies in this case), Liability Insurance, and Umbrella Insurance. I doubt that David's will be out any money except for increased premiums.

I also think that David's offering credits is a compromise with the insurance company to spread the payments out, to ease the financial burden, and possibly save money. How many people actually use the credits in time.

As a member renting out points, I would be extremely satisfied if I got my 30% as the credit. I plan to use David's myself, to get Beach Club at the 11 month mark for a future trip. I would be even happier with David's if they paid me the 30% cash, not expecting. And would be OK if I didn't get the 30% at all.

BTW, I am interpreting the 2 notices that no money will be refunded or paid to either party. But you will get what is owed to you as a credit for a future rental.

As of now, I am not at risk unless the closure goes into the last week of April. Certainly possible but current indications are pointing to a reopen by then. I will feel sorry for the renter if it is a phased opening of the parks. Or worse, resorts open and the parks do not.

 

[meryll83]

What have people’s experiences been so far as renters unable to attend due to closure?
We were due at DL Grand Californian mid-April, and now the closure has been extended I’m expecting some more contact from David’s...