Dues at closing

[gamomof2]

why would I have to pay dues for a future use year at closing? The contract we are looking at has points starting 12/1/2018. December. but I am asked to pay 600-700 in dues at closing for that year and they tell me this is good because I would be paid up through 2019. just one month into that use year.

I'm confused.

 

[Matty B13]

The dues are collect in January for each year, so the owner probably has paid the dues for 2018 and wants to get you to pay these dues/maintenance fees for the 2018 points. This is negotiable, there is no set rule when buying resale.

 

[hlhlaw07]

why would I have to pay dues for a future use year at closing? The contract we are looking at has points starting 12/1/2018. December. but I am asked to pay 600-700 in dues at closing for that year and they tell me this is good because I would be paid up through 2019. just one month into that use year.

I'm confused.

Generally if you are getting points for that year, you will reimburse the owner those costs. Since you are getting 2018 points it’s not unreasonable the owner wants to be reimbursed for the dues on those points. Dues are paid by calendar year not UY.

 

[DVCDisneyRunner]

It is all negotiable during the offer process, price per point, closing cost, dues...

 

[Networth]

Considering your getting all of 2018 points, paying the dues on those points seems fair, but hey everything is up for negotiation.

 

[CMNJ]

Lol I’ll be the voice of dissent but in my opinion I wouldn’t be happy reimbursing the owner for the 2018 MF when you are actually buying a stripped contract. A Dec Contract is currently in its 2017 UY. If the contract had current UY points (2017) I see it being “fair” to reimburse for the MF. When the original owner bought from Disney they would have gotten prorated dues based on the purchase date. Say they bought in March (like you are curently looking at) in 2010. They would have gotten full 2009 points and only paid dues for 10 months that year (plus they’d get full points again on Dec 1st 2010). If they bought on Dec 1st of that year they would have only paid 1 month’s worth of dues and still received the 2010 points. My point is lots of owners want to sell stripped contracts (those with no current UY points) and get reimbursed for the dues that cover points they have already used. Unless it is an incredible deal on the price per point vs a non stripped contract I personally wouldn’t be interested.

 

[KAT4DISNEY]

I also wouldn't reimburse for 2018 points on a December UY. You are overpaying if you do. But it's virtually an impossible battle to fight with resale brokers. Usually the best you can do is to offer a lower price per points that in effect offsets paying for the dues. It likely wouldn't be accepted but brokers get stuck on "if you get the points then you pay" so saying you won't reimburse for the dues is extremely unlikely to work as they advise the sellers too. The best time to buy a December UY is towards the end of the year when the sellers often stop asking for reimbursement since the new dues are upcoming.

 

[Matty B13]

You could also ask the sellers to pay closing cost. It really only comes down to the final number that you pay for the whole thing, the argument about MF's is just another way to increase the price.

 

[CMNJ]

I also wouldn't reimburse for 2018 points on a December UY. You are overpaying if you do. But it's virtually an impossible battle to fight with resale brokers. Usually the best you can do is to offer a lower price per points that in effect offsets paying for the dues. It likely wouldn't be accepted but brokers get stuck on "if you get the points then you pay" so saying you won't reimburse for the dues is extremely unlikely to work as they advise the sellers too. The best time to buy a December UY is towards the end of the year when the sellers often stop asking for reimbursement since the new dues are upcoming.

I absolutely agree with you-the brokers really push for the reimbursement of dues even if not really appropriate (which will influence the seller). I just wanted the OP to understand that because of the Dec UY they are really paying the owner for points that the owner already used. Putting that into perspective may change their thoughts regarding the value of this contract vs one that actually has current UY points and allow them to negotiate appropriately (as you can see from the responses prior to mine many people are being led to believe they should reimburse asit is only only “fair” since the get 2018 points. I’m not anti dues reimbursement (I’ve actually reimbursed for current UY dues on one contract I bought)-I just hate how the brokers try to lead buyers to believe “Disney likes to see the buyer paying closing costs and reimbursing for dues (esp if not appropriate)”. I’ve actually heard that line a couple times. I’m sure Disney looks at the total price as well as the points avail to decide ROFR not if the person reimbursed for dues on points already used.

Bottom line OP is that you have to decide if this contract is worth it with no current UY points and the owner wanting you to reiumburse for points they already used. That essentially raises their asking price (per point) by $6-7-is the contract worth that?

 

[CarolMN]

Agree with those who say that the total cost of the contract to you is what matters, not necessarily how it breaks down. Offer what you are willing to pay for the contract and move on if the seller doesn't agree.

 

[supersnoop]

The problem is that the resale market looks at dues and points in the same year. Dues are paid per calendar year and points are available by use year. Do 2018 dues cover 2018 points? Resale brokers tend to think so, and they try to collect dues based on that concept.

Disney treats them as separate concepts. They prorate based on when you purchase, not based on which points you receive. I’m not really sure what will happen in 2042 when some contracts expire.

 

[thelionqueen]

I’ve found most brokers give you push back when asking to pay MF on current year points. That really annoys me to be quite honest! It’s up to you to offer what you want and o would also not pay for MFs on Dec points. No way! Best to you!

 

[Shellyred8]

Here's my thinking on this subject (and not in alignment with what most brokers think):
If the points are for 12/1/2018, you should be able to use them from 12/1/2017 - 11/30/2020. You get 3 years to use them. If you haven't yet come to an agreement on the price, the whole purchase process will take another couple of months to be finalized. So, you won't be able to start using the points until about June. So, you have effectively lost 6 months of usage time. You should be able to negotiate that the owners pay part of the dues, because you have lost some time that you can use them.

As others have said, I would negotiate to have the owners pay part of the closing fees, or a lower price per point to cover the cost that you would be paying for the full amount of the dues. The dues seem to be a touchy issue.

Good luck!

 

[gamomof2]

Thank you for the response. I think the first problem was that I didn't understand dues were billed per calendar year. We also have figured out based on when we want to go during the year that a December use year isn't good for us. But I do appreciate the explanations.