# Closing costs, unauthorized charges on assessment



## SusanH (Feb 21, 2016)

Hello everyone, I've been reading this forum for months but this is my first post.  

I did not purchase a DRI membership but I am trying to help someone who did.  I am looking for information about the closing costs DRI charges for the sale of points and memberships.  There is no information on the contract of what these charges were for or to whom the money was  paid.

I'm also curious about their practice of adding unauthorized charges to assessment bills.  Charitable donations and travel insurance?  

I expected to find these issues had already been discussed here but I've searched and can't find anything.  

I'll be happy to show my contract to anyone that is interested.  Please contact me via PM, email, or right in this thread.  

Do I understand correctly that after paying tens of thousands of dollars for memberships, some people GIVE their purchase back to DRI for FREE?  I understand why that might be happening, but just want to make sure that "surrendering" means the member takes a total loss on the initial purchase.

Forgive me if I sound stupid.  I find the points/membership thing pretty confusing.  

Thank you in advance for any help you can provide.  

SusanH


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## dougp26364 (Feb 21, 2016)

SusanH said:


> Hello everyone, I've been reading this forum for months but this is my first post.
> 
> I am looking for information about the closing costs DRI charges for the sale of points and memberships.  Specifically, there is no indication on my contract of what these charges were for or to whom the money was  paid.
> 
> ...



As to closing costs. I think just about every timeshare developer charges them. Typically the "Closing" is done in house and involves the paperwork necessary to transfer the ownership, similar to the closing on real property such as a home. The money stays with DRI and I believe is typically paid to DRI. For the most part I find the costs for a developer closing to be greatly inflated over what they should be. I don't know if they're charged up front and rolled into the finance package but, DRI use to charge the closing costs after the financing was paid off. You'd then receive a bill in the amount of the closing costs payable to DRI's closing department. Back in 1999 it was a $800 charge on a $18,900 purchase price. I have no idea what the figure would be today.

As to unauthorized charges. I'm assuming you're talking about the charge for ARDA with MF's and the tack on for travel insurance when reserving a vacation. Most companies offer those as a suggested option. DRI adds them on and forces owners to remove them before finalizing payment. Most will agree they shouldn't force owners to de-select it but offer it as an option, like most management companies, but that's not how DRI rolls.


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## Passepartout (Feb 21, 2016)

Hi SusanH, yes, after paying tens of thousand$ for a timeshare, people gladly turn them over to the developer and walk away. DRI charges them to do this. And it gets worse. Some developers refuse to even take them back, causing owners to default- resulting in a credit ding- if they can't find a willing party to take it off their hands. Some folks resort to paying scammers to do the impossible. That is 'get them out' of their obligation and ownership. 

There is not an easy, and equitable market for pre-owned timeshares. That is a major mission of TUG. To provide information on the use of, and education on buying and re-selling timeshares.

Jim


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## SusanH (Feb 21, 2016)

*Thank you!*

I didn't mean to mislead anyone with my opening post.  What I referred to as "my" contract is not technically MINE.  I am however  trying to find out some information for the owner of that contract.  

Doug, thank you for your response!  The DRI club membership contract says they charge the closing costs whether it is a cash or credit sale.  Thus the closing costs are not for any services related to a loan.  The membership purchase is not a real estate purchase, so there are no deeds to be transferred, taxes payable to the government, title searches, or the other things that fall into the category of "closing costs".

As an incentive to sign the contract the day of the presentation, DRI claims it will lower the purchaser's closing costs.  In this case, they "lowered" it to 3.5% of the purchase price.  BUT the ORIGINAL closing cost is not disclosed anywhere.  For all we know, the ORIGINAL closing cost was 1%!

How does a person know if they got the reward they were promised if they don't see what they would have paid if they'd waited a day?  This is only ONE one of my issues with the closing costs.

They also offered to pay a "trust fee" as an incentive to sign immediately.  The contract does not mention the existence of any trust fee.  And the document that shows the "rewards" that were given for signing the same day, state that DRI will pay a "trust fee" but it doesn't say how much that trust fee is or what it was for.

"As to unauthorized charges. I'm assuming you're talking about the charge for ARDA with MF's and the tack on for travel insurance *when reserving a vacation."*

What is an MF?

I am referring to the ARDA-ROC Voluntary Contribution that is charged to every member.  It is staggering to me that the members are making voluntary contributions to an organization that PREVENTS the passage of legislation that would protect timeshare consumers.  This group lobbys for the DRI's interests, not the consumers.

Travel insurance was tacked on to this year's assessment bill.  There has not been any vacation, lol.  This member has never used the membership.

"but that's not how DRI rolls"  Yes it is and I am very interested in the legality of that practice.

I'm hoping some other DRI club members will see these posts and comment or contact me to compare notes.

"That is a major mission of TUG. To provide information on the use of, and education on buying and re-selling timeshares."

I am also hoping TUG will take an interest in these issues and add information about them to the site. 

Passepartout, thank you for clarifying.  I was pretty sure that was the case, but I wanted to be sure.


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## Michael1991 (Feb 22, 2016)

SusanH said:


> Travel insurance was tacked on to this year's assessment bill.  There has not been any vacation, lol.  This member has never used the membership.



The travel insurance was billed on 2015 statements. I don't know the details of this line item, but DRI claimed it was a mistake and refunded the fee. They sent us a check. This fee was not on bills for 2016.


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## SusanH (Feb 23, 2016)

Michael1991 said:


> The travel insurance was billed on 2015 statements. I don't know the details of this line item, but DRI claimed it was a mistake and refunded the fee. They sent us a check. This fee was not on bills for 2016.



I'm sorry I wasn't very clear.  It is the 2015 assessment bill that has the charge on it.  We don't have a 2016 assessment bill yet.  

Thanks for letting me know what happened with that charge.  Did you get a refund because you asked for it, or do you think they automatically repaid everyone?


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## Michael1991 (Feb 23, 2016)

The travel insurance fee refund was automatic, we made no request. 

2016 annual point fees were billed in November, due January 1, and are now past due.


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## SusanH (Feb 23, 2016)

Thank you Michael.  

I think the recent case of Overton v. Westgate, (where the plaintiff was awarded $500k in punitives and about $120k in legal fees) may deter some of the questionable practices that have been going on for decades.  https://www.tncourts.gov/sites/default/files/overton.pdf

I hope so.


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## SusanH (Apr 7, 2016)

@Michael1991

I was just reviewing this thread. I see that I misunderstood something you said in post #4 and wrongly contradicted you:

"but that's not how DRI rolls" Yes it is and I am very interested in the legality of that practice.

You were saying DRI SHOULD offer the donations as a voluntary option, but that is not how they do it.  I agree.  Sorry for the confusion.

I am not sure their practice of forcing people to de-select the donation is legal.


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## T_R_Oglodyte (Apr 7, 2016)

Michael1991 said:


> The travel insurance fee refund was automatic, we made no request.
> 
> 2016 annual point fees were billed in November, due January 1, and are now past due.



Someone at Diamond goofed big time when they put the travel insurance on the 2015 bills.  We paid for it inadvertently.  Then when I looked at the coverage I said "What a deal!!!"  The policy as written provided coverage we would have done during the year, for any purpose, to any location.  Not just travel to DRI resorts.  Not just travel booked through DRI reservations.

So I was sad when they walked it back.  Actually, I think they used the fact that it was "inadvertently" included with billing as a convenient reason to cancel the program after they realized they made a mistake in the coverage.  

I sent them a note saying "please don't cancel our coverage", but they didn't pay any attention to that - all I got was a canned response that repeated verbatim what they said in the message I was responding to.


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## SusanH (Apr 7, 2016)

How in the world does a company that is worth nearly a billion dollars make a "mistake" like that?  smh


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## T_R_Oglodyte (Apr 7, 2016)

SusanH said:


> How in the world does a company that is worth nearly a billion dollars make a "mistake" like that?  smh



Because no company is perfect.  And if you did set up internal controls that made it impossible for something like that to happen the company would go out of  business because nothing would ever get approved in any kind of timely manner.

At some point you let employees do their jobs, and expect that there will be goofs, and recognize that goofs occur in all sizes.  Then when goofs occur you follow up to see what happened and what can be learned.   

And isn't that the kind of organization you would prefer to work for?  Or do you prefer to work for an employer who doesn't ever allow employees to make mistakes?


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## SusanH (Apr 7, 2016)

T_R_Oglodyte said:


> Because no company is perfect.  And if you did set up internal controls that made it impossible for something like that to happen the company would go out of  business because nothing would ever get approved in any kind of timely manner.



Adding a new charge to assessment bills is a pretty big deal.  I would expect something like that to be reviewed by several different departments before final approval was given.


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