In Episode 027, we meet Debbie Ely who is not only our DVC neighbor but also a timeshare industry insider. Debbie has worked in the timeshare industry for 20+ years and is a proud member of the Disney Vacation Club. We learn about her buying into DVC and her biggest regret as a DVC member. Hint! It's not, “I should have bought sooner.” We also learn about the history of Vacation Club Loans and how they may be of service to our fellow members.
Chad's backstory of My DVC Points and Personal Finance
Prior to hosting Disney Vacation Club conversations, I spent a solid decade as a financial coach helping people optimize their personal finances and get out of debt. That business was extremely successful and I was able to cash flow my way through an MBA in Financial Planning 100% debt-free. I'll be the first to admit when a My DVC Points Community member suggested I interview Debbie, I wasn't that interested airing an episode about financing a timeshare. I am both a fiscally conservative and an open-minded conversationalist. Debbie came with such high praise from Nick Cotton from DVC Resale Market, Valerie from Episode 002 and other trusted people in the community that I felt it was worth talking with Debbie. My DVC Points isn't about promoting Chad Pennycuff's personal opinions, this show is a celebration of the DVC community and the diversity of thought within the community. By respectfully sharing our stories, experiences, opinions, and preferences, we become better neighbors and develop a deeper sense of community. To finance or not finance your contract is a matter of your personal opinion, your economic situation, and your life choices. We all do Disney differently. The success of our podcast, Live shows, and Facebook Community Group revolves around real member conversations with respect for diversity of opinion and an open mind so that we can learn from other's perspectives.
All of my community research lead to this simple conclusion. Debbie offers services that a lot of DVC members value and has a track record of serving members with excellence. I spoke with Debbie numerous times before we recorded this episode. The more we talked, the more I became convinced that she has the heart to serve the community. An estimated 80% of direct buyers finance their contracts and an estimated 30% of resale buyers finance. Through the guest vetting and interview process, I honestly learned a lot and developed a deeper appreciation for others in the community. As with every episode, I hope you enjoy the conversation and gain from Debbie's perspective.
Meet Debbie – DVC Member and Industry Insider
Debbie has been working in the timeshare industry since 2006 and has worked with well over 40 major brands. She chooses to be a Disney Vacation Club member. Debbie joined Disney Vacation Club in 2013 when she bought contracts at Boardwalk Villas and Saratoga Springs Resort. A friend who happened to be a resale agent found a loaded contract with triple points at a good deal and suggested she buy the contract as a financial investment. Having worked in the timeshare industry since 2006, she recognized this as a good deal. However, 2 years later after using three years of points, Debbie sold the contracts. She was able to stay at all of the Disney resorts over those three years. One of her favorite memories was watching the fireworks from the private patio on a bungalow at the Polynesian resort. Looking back, she really regrets selling those contracts. Every time the Food and Wine event is announced she regrets selling off the Boardwalk contracts. We briefly discuss the classic DVC debate of do you buy where you want to stay? Or buy where you love? Debbie realized through buying and selling an experience that she is a buy-where-you-love person. As a result, when Polynesian resale contracts hit the market, she re-joined DVC as a Polynesian owner. She believes long term happiness in DVC comes from owning a resort that makes your heart sing. If you buy what makes you happy and you won’t have any regrets.
Next time addonitis breaks out at Debbie’s house, she will seriously consider an Aulani contract. Not only does she love the resort, but she also points out that Atlantis Resorts are building a world-class water park right next door to the Aulani resort. She believes that will make staying at Aulani even more attractive.
Rapid-Fire Questions – Debbie's Take:
- Mickey Bar over a Dole Whip
- Pretzel (with mustard) over a Churro
- Umbrella vs Poncho – Probably Neither! As a Floridian, she embraces the tropical environment and just deals with the rain.
- Rock a T-shirt over Ears
- Disney's Animal Kingdom is her favorite park
- Pandora, the World of Avatar is her favorite land with the high hopes that Star Wars Galaxy’s Edge will take over as her favorite land when it opens up in Orlando.
- Flight of Passage is her favorite attraction
- Flame Tree Barbeque is her favorite place to relax and grab a drink or dessert.
- Wilderness Lodge is her favorite themed resorts for a resort only stay.
- Polynesian and Beach Club is her favorite resorts for theme park trips.
Normally Debbie stays in deluxe studios. However, she’s stayed in almost every booking category including the Polynesian bungalows and the grand villas at VGF. Because she’s been in the timeshare industry for so many years, she’s always stayed in another Orlando based timeshare with full kitchen, laundry, home-like amenities. When she started getting into DVC, she realized that she can get the full benefits of a timeshare and have all the benefits of staying on property like 60-day fast passes, transportation to the parks and a full immersive Disney experience. Out of all of the brands she’s worked within the timeshare industry, she’s only ever owned DVC. She feels that DVC is an exceptional value because she believes she will never lose money on DVC. She can use the points and get a great value; she can rent the points and get great value or even sell the contract if necessary and get a great value on resale. Debbie also commented that the Disney product reaches all age groups. She tells a story that her entire party of 17 people all had that euphoric giddy feeling when Goofy appeared for an impromptu character meet. Her desire is to always stay on-property; however, her point ownership doesn’t always allow staying on property. In order to accommodate all 17 people, they needed to rent two four-bedroom villas at an off-property timeshare.
DVC Bucketlist and 2000 Magical DVC Points from Tinkerbell
Debby has two items on her DVC bucket list. The first is to book an entire stay at the Treehouse Villas at Saratoga Springs Resort. She would also love to stay in the Grand Californian for a few days. She would also love to go back to Aulani. She has fond memories of Aulani and even offered to share those 2000 magical Tinkerbell points with the My DVC Points community for our upcoming trip to Aulani.
Debby’s Advice to a New or Prospective Member
Learn the perks that you get as a DVC member. Things like the benefits of staying on property for the 60-day fast pass window but not getting fast passes in the first hour of the morning when the lines are shorter. She also recommends fully researching each DVC resort for all of the extra benefits that happen at a DVC resort such as the night vision goggles that Animal Kingdom Villas offers guests for free each night.
One of Debbie’s favorite Disney memories from a few years back when her grandchild fell to sleep on top of her stroller at the Magic Kingdom. They don’t recall how the child made it to the top of the stroller; however,
One of the most interesting elements of Debbie’s story is that she’s been in the timeshare industry for over 20 years. She’s worked with, stayed at and financed almost every major brand imaginable at Vacation Club Loans; however, DVC is the only timeshare she’s ever owned. As a member, that speaks volumes to validate my belief that DVC is different from any other timeshare. When a person who’s a timeshare industry inside makes the claim, they know every major brand in the industry, but DVC is the only one they personally own, it validates my decision to also buy into DVC. In over a decade of financial coaching; I ran across countless people with a timeshare they cannot use, rent or sell. DVC is unique in that Walt Disney World is the #1 vacation destination in the world. Every middle-class American family has a life goal to take their kids to Disney. Debbie explains that she’s stayed at every top brand in the timeshare industry such as Marriott, Hilton, Hyatt, Blue Green Vacation Club, Club Wyndham, and others; that are all excellent. However, Disney is at the very top of the marquee brands. DVC is the only timeshare powered with a consumer confidence formula of faith, trust and pixie dust.
The Backstory of Vacation Club Loans
Debbie explains that she is an accountant by trade. She hired into a timeshare developer as an accountant at the corporate office. Having worked in the financial aspects of the timeshare industry, the timeshare developer bought a resale company in Orlando. That’s when Debbie learned the resale side of the business. She identified a key problem at the time. Many families wanted to save money and buy resale; however, timeshares are typically financed by the developer. This makes it incredibly easy to buy from a developer. However, families that want to save a lot of money on the purchase price ended up buying direct and paying a lot more because there wasn’t a company out there serving the resale industry. Just over four years ago, Debbie solved this problem by starting her own company called Vacation Club Loans. The vast majority of loans financed through Vacation Club Loans are DVC products.
The Lifecycle of the Average Timeshare Owner, Exit Strategy & Disney’s Riviera Resort
Debbie mentioned the lifecycle of a timeshare owner. I picked up on this concept because I’ve heard from numerous agents, brokers and industry insiders that the average lifespan of a DVC owner is 7-10 years. People want out for various reasons. Death in the family, divorce or disability. However, with Disney, sometimes their children outgrow Disney. The family wants to move on to more thrill ride-based theme parks or grow out of theme parks altogether. Debbie did a full study where she determined the industry average is 8 years. After about 6-7 years the family starts booking less frequently and not using the timeshare and finally, they decide to just sell the property.
We both agreed, there are a few DVC properties that we would buy and be 100% happy staying at those resorts. For Debbie, it would be Disney’s Polynesian Villas and Bungalows along with Disney’s Beach Club Villas. For myself, Beach Club and The Villas at the Grand Californian are the only two on my list. My wife would be happy as a clam never leaving the Savannah view at Kidani Village. We also agreed that we wouldn’t consider buying Disney’s Riviera Resort direct because we have serious concerns about the exit strategy. If absolutely fell in love with Riviera we may consider buying a restricted resale, but we’d have to stay there and try out the resort first. We both agreed the resale restrictions imposed on new resorts is not a deal-breaker given the potential savings over buying direct.
Blog Post Bonus Content: Post-Interview Commentary
Since we recorded the first Riviera resale contract hit the market. It was a 100-point contract listed at $132 and is rumored to have sold for $100 a point. The owner paid $188 a point plus closing costs (approximately $700) for an estimated total of $19500 and walked away with an estimated $9350 after paying commissions to the resale agent. The owner lost 52% of the value and never ever got to use the points they purchased. Riviera owners cannot book a stay until December 16, 2019, when the resort actually opens. Initial estimates for Riviera resale were in the $78 a point range. However, the new buyer was able to purchase a full 50-year contract at a 46.8% savings. They have an effective $2 cost basis per point. With dues and closing costs factored in, the net cost per point would be just over $10 a point. Given a rental market bearing $17 to $18.50 a point, Riviera resale is an attractive option for those wishing to rent out the points on a commercial basis. (We don’t know how well the Riviera will perform on the rental market given the relatively higher than average point charts.) If the Riviera resort has as much rental demand as Bay Lake Tower, I predict that many Riviera points will end up in the rental market given the low cost of points. High rental demand coupled with an inexpensive supply of points would make this an ideal property for commercial investors. I can see the Riviera restrictions benefitting the developer and commercial investors but have yet to see a benefit for the core DVC membership. As consumers, you have the ability to make an educated and empowered vote with your wallet if you support the restrictions or not. I respect your choices either way.
Three Main Products of Vacation Club Loans
- New Timeshare Contract Purchase (Resales or Direct Sales from the Developer)
- Refinance an Existing Timeshare Contract
- Cash Out Equity Loan Financing
Vacation Club Loans finances new and resale purchases. This is the core product. They are also able to help people refinance their contracts at lower interest rates and shorter terms. This helps them save money and get out of debt quicker. Debbie explained that quite often members have a paid-in-full contract and need cash for a life event. The cash-out equity financing option allows the member to keep their contract, they won’t lose any direct purchase benefits, but can still keep the timeshare and get access to the needed cash.
Debbie explains some of the common underwriting criteria at the time of publication.
- You need a 20% down payment and at least a credit score of 600.
- Vacation Club Loans finances every Disney Vacation Club resort. They finance Hilton Head, Grand Californian, and Aulani. This is important as some finance companies only finance resorts in Florida.
- The industry average for timeshare loans is roughly 16.9% when using the developer's financing programs.
- Interest rates are based on credit score which can range from 9.99% to 15.99%.
- The average interest rate at Vacation Club Loans is just 11.9%. (5% less than buying direct and 3% less than most other lenders).
- For more information, see VacationClubLoans.com or call 800-334-2334.
Vacation Club Loans is a licensed consumer financing company that can work with any resale broker. They have over 30 resale brokers in their network and only a few specialize in DVC. We had an excellent conversation about our friends at DVC Resale Market. I’ve purchased six contracts through them and sold one and had consistently excellent experiences. Debbie indicated she’s closed a LOT of loans through them as well and has nothing but excellent things to say about the DVC Resale Market team.
Is financing a DVC timeshare stupid?
Debbie and I opened talked about some criticism people post on the internet about financing a timeshare as a stupid decision. In the show, we unpack that event with her own Boardwalk example. The nutshell of the story is that the resale contract appreciated more than 10% per year in this particular example. Given the fact that the principle goes down every year, the buyer wouldn't have paid 10% interest every year.
Through conversations with Debbie, various members and even other members of the leadership team at My DVC Points who have financed a loan with her, I've started to see the value others see in her services. The popularity of financing a DVC contract cannot be denied. After listening to the interview, editing, and writing show notes. I can honestly say that I'm proud to have Debbie and Vacation Club Loans as sponsors of the show. She's not just a timeshare insider, she's an avid Disney fan, a proud owner of Disney Vacation Club and a leader in the DVC community.
You can contact Debbie at VacationClubLoans.com or by calling 800-334-2334. Please be sure to mention My DVC Points in the conversation.
Today's episode was produced, edited, and engineered by Chad Pennycuff. Show notes by Samantha Kurtz-Seif. Facebook admins and moderators of the My DVC Points Community Group: Valerie Fairnington, Donna Bickert, Tamara Speidel, Caleb Allison, and Mary Anne Tracy.
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