Financing options

kddpac · 04-15-2008, 02:38 AM

Does anyone have any good financing options for the membership fees of a DC besides home equity. With a recent home purchase and many lenders not going higher than 80% LTV, home equity may not be an option for us right now and we were wondering if anyone else has found any other reasonable financing options?

Bourne · 04-15-2008, 05:55 AM

I did come across a new option last week that had really attractive rates.

I will search again and post a link.

DC4MS · 04-15-2008, 05:56 AM

Check out
FirstAgain provides Financing for Destination Club Members

Bourne · 04-15-2008, 09:34 AM

Quote:

Originally Posted by DC4MS

Check out
FirstAgain provides Financing for Destination Club Members

An I thought I was night owl.

Tedpilot · 04-15-2008, 04:13 PM

Some other thoughts...HCC does have financing available but not sure how good it is. You may want to consider a tiered-in payment for your membership as well. Simply, pay 1/3 each month over three months or something like that? Maybe 1/4 each month over four? I'm sure HCC would be amicable to such an arrangement.

vineyarder · 04-15-2008, 05:00 PM

Quote:

Originally Posted by kddpac

Does anyone have any good financing options for the membership fees of a DC besides home equity. With a recent home purchase and many lenders not going higher than 80% LTV, home equity may not be an option for us right now and we were wondering if anyone else has found any other reasonable financing options?

Maybe it's just me, but I'm not sure that a destination club is an appropriate purchase for someone that needs to finance the deposit. Am I too conservative?

LTTravel · 04-15-2008, 05:43 PM

Quote:

Originally Posted by vineyarder

Maybe it's just me, but I'm not sure that a destination club is an appropriate purchase for someone that needs to finance the deposit. Am I too conservative?

I agree. If you only have 20% equity in your home, don't finance a DC membership.

smtravelor · 04-15-2008, 06:33 PM

The person who asked the question about financing was looking for information. IMHO, the recent responses are overly judgmental and provide unsolicted advice. I hope that these forums will be welcoming to DC newcomers and encourage their participation.

kddpac · 04-15-2008, 06:57 PM

Wow, I did not expect such negative responses. For those that are interested I asked about financing not because we NEED to finance the deposit but to simply consider all options. In our case with a very recent home purchase the equity OPTION is limiting. That does not mean it is our only option. We are simply curious about ALL options. We are in our due diligence phase now and researching everything about the dc industry. I certainly hope that this elitist attitude is not the general feeling of

all members.

Tedpilot · 04-15-2008, 07:50 PM

kddpac - There is not an elitist attitude on this board. When you ask a question expect to get viewpoints from all angles. They are not insinuating anything from it, just their thought from the information provided to them in the thread.

That being said, what venues to obtain a down payment are available and your thoughts on each?

2nd Mortgage
DC provided financing
Personal loan
Long term savings
Coop w/ family/friends
Other?

LTTravel · 04-15-2008, 08:26 PM

This is in no way an elitist attitude but an opinion. The reason why we are in the current sub prime mess is that many people took out huge mortages with zero money down expecting the value of their real estate purchase to increase. But the value of the homes went down and now they are abandoning their homes.
Despite our general positive attitude towards DC's, the events of Tanner and Haley and now possibly Portofino are still clear. Even with equity clubs (Ventures Equity as an example, we don't know what the original investors ended up with after they were sold to UR) there is no guarantee that any company wont go under. I think that most people on this discussion forum would not recommend financing a timeshare. I am more conservative. I would not recommend financing a DC, or Cosmetic Surgery or a number of purchases, but that is just my opinion.

TarheelTraveler · 04-15-2008, 10:23 PM

A lot of very smart people finance when they could easily afford it out of pocket. I think it all depends on your risk tolerance, interest rate you have available, whether the interest is tax deductible, whether the DC does have a potential appreciation component, etc.

pwrshift · 04-15-2008, 10:47 PM

I'm guessing that the average DC member is more of an elitist than those buying timeshares, but even in the timeshare boards they don't recommend financing a timeshare.

Financing a timeshare. - Timeshare Users Group Online Community Forums

A vacation place is not a second home -- it's a holiday lifestyle. Marriott would love to loan you money to buy one of their timeshares...at 13.9%. Surprisingly many people line up to buy that way and regret it later when they find out that it's like buying a new car in that you lose money the moment you drive away...and it's not so easy to get out.

As long as the DC you might join doesn't fail, you at least have a chance of getting 80% of your money back ... but you can't buy a DC for 50% of the retail price and buy resale as you can with the more established timeshare market.

Desties · 04-15-2008, 11:31 PM

Yikes, the "elitist" term is being bandied about more in this thread than it is on the cable news channels covering the elections race.

I'll only add this. Exclusive Resorts -- the biggest of all destination clubs -- even presents its own 5-year financing option on its membership plan page.

I think few will recommend it, because financing is something that most associate with a necessity (car) or an appreciating asset (home). In reality, many will go ahead and finance a DC purchase. If so, the buyer should take into consideration that the economics of the purchase will change as the per night math will be higher given the interest payments. As long as the buyer knows all of the inherent risks (of being stuck with a third party loan, even if a DC defaults) and is comfortable with the math, the DC industry itself is telling you that financing is an alternative.

It's a dangerous one, but it's there and people are doing it.

kddpac · 04-16-2008, 12:49 AM

Thank you everyone for your honest opinion. We are considering what you have all had to say. We consider a DC membership a "toy" as opposed to an investment opportunity. We obviously consider our home, cars, etc to be neccesity. We have a few other "toys" currently (ie a vacation home in local ski/lake area and a 30 foot cabin cruiser boat). Our "toys" are time consuming and becoming more and more of a headache instead of the fun that they should be. I asked about financing because we are considering joining a DC instead of maintaining our other "toys" . The hope is of course that we have more fun with less headache. Since ER is the only club we have first hand experience with, we are hesitant to liquidate our other toys until we are sure that HCC is for us. That is the reason for the financing question as it would be temporary for the first year (while the deposit is 100% refundable) until we decide if HCC is for us and more enjoyable than the other "toys". Assuming all goes well, we would liquidiate one of the other "toys". Unfortunately with both my husband and I having high pressure jobs, we don't have time for all 3 "toys"! Of course with any purchase of these types, there is always risk. These are the decisions you make in life that are against your financial advisors best advice! But we feel life is short, so live it up right?!!
Just curious -anyone know the age demographics in the DCs in general. What is the percentage of other young couples in their early 30s without kids (that is us). I am trying to get a feel for the other members. It seems to be a lot of families or empty nesters? We are curious to hear opinions of others who have similar situations to us.

NeilGoBlue · 04-16-2008, 08:52 AM

Quote:

Originally Posted by kddpac

Thank you everyone for your honest opinion. We are considering what you have all had to say. We consider a DC membership a "toy" as opposed to an investment opportunity. We obviously consider our home, cars, etc to be neccesity. We have a few other "toys" currently (ie a vacation home in local ski/lake area and a 30 foot cabin cruiser boat). Our "toys" are time consuming and becoming more and more of a headache instead of the fun that they should be. I asked about financing because we are considering joining a DC instead of maintaining our other "toys" . The hope is of course that we have more fun with less headache. Since ER is the only club we have first hand experience with, we are hesitant to liquidate our other toys until we are sure that HCC is for us. That is the reason for the financing question as it would be temporary for the first year (while the deposit is 100% refundable) until we decide if HCC is for us and more enjoyable than the other "toys". Assuming all goes well, we would liquidiate one of the other "toys". Unfortunately with both my husband and I having high pressure jobs, we don't have time for all 3 "toys"! Of course with any purchase of these types, there is always risk. These are the decisions you make in life that are against your financial advisors best advice! But we feel life is short, so live it up right?!!
Just curious -anyone know the age demographics in the DCs in general. What is the percentage of other young couples in their early 30s without kids (that is us). I am trying to get a feel for the other members. It seems to be a lot of families or empty nesters? We are curious to hear opinions of others who have similar situations to us.

There are a lot of DC members in your age bracket, but I don't know about the 'no kids' thing... If you travel just by yourself, a DC might not be for you. There will be far more bedrooms than you need. (there would be cheaper alternatives). Most DC members like to travel with other people, whether it be friends, relatives, inlaws, or grandchildren. That is why we need the big house with multiple bedrooms.

Bourne · 04-16-2008, 09:08 AM

I am in your age group with 37ft Searay to boot.

Difference is, I do have 1 + ( x - 0.15 ) kids.

If you do plan on having kids in the near future, a DC will make sense. Otherwise there are cheaper options in form of hotels avaialble.

A bedroom for the infant, another for the toddler, guests with kids needing two bedrooms, and soon the 5br Outer Banks home starts looing small.

04-15-2008, 02:38 AM	#1
kddpac Senior Member Join Date: Mar 2008 Location: Calabasas, CA Posts: 212 Club: High Country Club	Financing options Does anyone have any good financing options for the membership fees of a DC besides home equity. With a recent home purchase and many lenders not going higher than 80% LTV, home equity may not be an option for us right now and we were wondering if anyone else has found any other reasonable financing options?

04-15-2008, 05:55 AM	#2
Bourne Senior Member Join Date: Nov 2007 Location: 60601 Posts: 485 Club: High Country Club, Pinnacle Yachts	Re: Financing options I did come across a new option last week that had really attractive rates. I will search again and post a link. __________________ The Nile is a river in Egypt......

04-15-2008, 05:56 AM	#3
DC4MS Administrator Join Date: Oct 2007 Location: USA Posts: 1,698 Club: DC4MS.com	Re: Financing options Check out FirstAgain provides Financing for Destination Club Members

04-15-2008, 04:13 PM	#5
Tedpilot Senior Member Join Date: Nov 2007 Location: Oklahoma Posts: 300 Club: HCC	Re: Financing options Some other thoughts...HCC does have financing available but not sure how good it is. You may want to consider a tiered-in payment for your membership as well. Simply, pay 1/3 each month over three months or something like that? Maybe 1/4 each month over four? I'm sure HCC would be amicable to such an arrangement.

04-15-2008, 06:33 PM	#8
smtravelor Member Join Date: Mar 2008 Location: NY Posts: 30 Club: Ultimate Escapes	Re: Financing options The person who asked the question about financing was looking for information. IMHO, the recent responses are overly judgmental and provide unsolicted advice. I hope that these forums will be welcoming to DC newcomers and encourage their participation.

04-15-2008, 06:57 PM	#9
kddpac Senior Member Join Date: Mar 2008 Location: Calabasas, CA Posts: 212 Club: High Country Club	Re: Financing options Wow, I did not expect such negative responses. For those that are interested I asked about financing not because we NEED to finance the deposit but to simply consider all options. In our case with a very recent home purchase the equity OPTION is limiting. That does not mean it is our only option. We are simply curious about ALL options. We are in our due diligence phase now and researching everything about the dc industry. I certainly hope that this elitist attitude is not the general feeling of all members.

04-15-2008, 07:50 PM	#10
Tedpilot Senior Member Join Date: Nov 2007 Location: Oklahoma Posts: 300 Club: HCC	Re: Financing options kddpac - There is not an elitist attitude on this board. When you ask a question expect to get viewpoints from all angles. They are not insinuating anything from it, just their thought from the information provided to them in the thread. That being said, what venues to obtain a down payment are available and your thoughts on each? 2nd Mortgage DC provided financing Personal loan Long term savings Coop w/ family/friends Other?

04-15-2008, 08:26 PM	#11
LTTravel Super Moderator Join Date: Nov 2007 Posts: 1,020 Club: ER, HCC Corporate, DHH Lite, Bud Lite (A few too many)	Re: Financing options This is in no way an elitist attitude but an opinion. The reason why we are in the current sub prime mess is that many people took out huge mortages with zero money down expecting the value of their real estate purchase to increase. But the value of the homes went down and now they are abandoning their homes. Despite our general positive attitude towards DC's, the events of Tanner and Haley and now possibly Portofino are still clear. Even with equity clubs (Ventures Equity as an example, we don't know what the original investors ended up with after they were sold to UR) there is no guarantee that any company wont go under. I think that most people on this discussion forum would not recommend financing a timeshare. I am more conservative. I would not recommend financing a DC, or Cosmetic Surgery or a number of purchases, but that is just my opinion.

04-15-2008, 10:23 PM	#12
TarheelTraveler Senior Member Join Date: Nov 2007 Posts: 513 Club: A&K Residence Club	Re: Financing options A lot of very smart people finance when they could easily afford it out of pocket. I think it all depends on your risk tolerance, interest rate you have available, whether the interest is tax deductible, whether the DC does have a potential appreciation component, etc.

04-15-2008, 10:47 PM	#13
pwrshift Senior Member Join Date: Nov 2007 Posts: 344	Re: Financing options I'm guessing that the average DC member is more of an elitist than those buying timeshares, but even in the timeshare boards they don't recommend financing a timeshare. Financing a timeshare. - Timeshare Users Group Online Community Forums A vacation place is not a second home -- it's a holiday lifestyle. Marriott would love to loan you money to buy one of their timeshares...at 13.9%. Surprisingly many people line up to buy that way and regret it later when they find out that it's like buying a new car in that you lose money the moment you drive away...and it's not so easy to get out. As long as the DC you might join doesn't fail, you at least have a chance of getting 80% of your money back ... but you can't buy a DC for 50% of the retail price and buy resale as you can with the more established timeshare market.

04-15-2008, 11:31 PM	#14
Desties Senior Member Join Date: Feb 2008 Posts: 257 Club: Ultimate Escapes Signature	Re: Financing options Yikes, the "elitist" term is being bandied about more in this thread than it is on the cable news channels covering the elections race. I'll only add this. Exclusive Resorts -- the biggest of all destination clubs -- even presents its own 5-year financing option on its membership plan page. I think few will recommend it, because financing is something that most associate with a necessity (car) or an appreciating asset (home). In reality, many will go ahead and finance a DC purchase. If so, the buyer should take into consideration that the economics of the purchase will change as the per night math will be higher given the interest payments. As long as the buyer knows all of the inherent risks (of being stuck with a third party loan, even if a DC defaults) and is comfortable with the math, the DC industry itself is telling you that financing is an alternative. It's a dangerous one, but it's there and people are doing it.

04-16-2008, 12:49 AM	#15
kddpac Senior Member Join Date: Mar 2008 Location: Calabasas, CA Posts: 212 Club: High Country Club	Re: Financing options Thank you everyone for your honest opinion. We are considering what you have all had to say. We consider a DC membership a "toy" as opposed to an investment opportunity. We obviously consider our home, cars, etc to be neccesity. We have a few other "toys" currently (ie a vacation home in local ski/lake area and a 30 foot cabin cruiser boat). Our "toys" are time consuming and becoming more and more of a headache instead of the fun that they should be. I asked about financing because we are considering joining a DC instead of maintaining our other "toys" . The hope is of course that we have more fun with less headache. Since ER is the only club we have first hand experience with, we are hesitant to liquidate our other toys until we are sure that HCC is for us. That is the reason for the financing question as it would be temporary for the first year (while the deposit is 100% refundable) until we decide if HCC is for us and more enjoyable than the other "toys". Assuming all goes well, we would liquidiate one of the other "toys". Unfortunately with both my husband and I having high pressure jobs, we don't have time for all 3 "toys"! Of course with any purchase of these types, there is always risk. These are the decisions you make in life that are against your financial advisors best advice! But we feel life is short, so live it up right?!! Just curious -anyone know the age demographics in the DCs in general. What is the percentage of other young couples in their early 30s without kids (that is us). I am trying to get a feel for the other members. It seems to be a lot of families or empty nesters? We are curious to hear opinions of others who have similar situations to us.

04-16-2008, 09:08 AM	#17
Bourne Senior Member Join Date: Nov 2007 Location: 60601 Posts: 485 Club: High Country Club, Pinnacle Yachts	Re: Financing options I am in your age group with 37ft Searay to boot. Difference is, I do have 1 + ( x - 0.15 ) kids. If you do plan on having kids in the near future, a DC will make sense. Otherwise there are cheaper options in form of hotels avaialble. A bedroom for the infant, another for the toddler, guests with kids needing two bedrooms, and soon the 5br Outer Banks home starts looing small. __________________ The Nile is a river in Egypt......