resales of points?

[elaine]

we just attended a Marriott presentation in Aruba (we did not buy). I started wondering what happens when a Destination Club member (who bought into the new points system) wants to sell their points. Say someone who bought a 6500 points package in Aruba. What happens? thanks, Elaine

 

[dioxide45]

we just attended a Marriott presentation in Aruba (we did not buy). I started wondering what happens when a Destination Club member (who bought into the new points system) wants to sell their points. Say someone who bought a 6500 points package in Aruba. What happens? thanks, Elaine

They advertise them on places like Redweek or eBay. We have seen a few eBay points listings. Redweek also has had a few and might still. The points resale still have to go through ROFR and FredM did indicate that MVCI exercised ROFR on a points deed a while back.

Sales reps have been saying since 6/20/2010 that MVCI is creating a points resignation program. Very few details of course and to date such a program has not been created.

So it seems the only option is to try to resell them on the open market since we are not aware of MCVI buying back points. We also have very few details on what kind of restrictions may be in place on the resale points. The documents provide for a lot of restrictions, but it has been reported that there would be none as long as the new owner pays the initiation and owner education fees are paid. We don't have a real life first had report yet to know the truth.

 

[BocaBoy]

I think the potential restrictions on the use of resale points are one of the biggest (but not the only) reason to not buy points, either resale or directly from MVCI. Fortunately for MVCI, most people don't realize that when they are considering such a purchase.

 

[LAX Mom]

I think the potential restrictions on the use of resale points are one of the biggest (but not the only) reason to not buy points, either resale or directly from MVCI. Fortunately for MVCI, most people don't realize that when they are considering such a purchase.

I agree and asked Marriott about this issue 3 times (3 different reps) on the day the points program was released. All 3 assured me that they would have a system in place within a year.....preferred brokers authorized to resale Marriott DC points. I told them I wouldn't consider a purchase until I knew I could unload them at a later point in time. There are too many unknowns with the purchase of resale Marriott DC points.

Marriott should have figured out this problem before they released this program.

 

[dioxide45]

The program is only two and a half years old. How many resorts at two and a half years old do you see a lot of resale weeks out there? Not many. I would expect when the program is more like ten years old that we will see a flood of resale point deeds, just like we see at well seasoned resorts.

I remember when the program was new that some people were saying that resale points would hit the market dirt cheap after about a year. It hasn't really happened like that. People will put them up for sale and try to recoup their "investment". Only after a few years do they start to become desperate.

 

[FractionalTraveler]

I'm one of those points’ purchasers and unlike many folks who continue to think of their timeshare as some sort of financial investment or real estate property, I think of it quite differently.

For me, it’s an investment in pre-paid family vacations. It’s a sunk cost and is discretionary spending as far as I'm concerned. The value is in the useage.

When I can't use it any more, rent it anymore, gift it any more, or pay the MF anymore, I will just dump it without any concern!

My vacation experiences will still be tightly secured in the depths of my brain cells until I expire.

That’s all there is to it for me. Nothing more, nothing less. No worries about it either.

 

[LAX Mom]

I'm one of those points’ purchasers and unlike many folks who continue to think of their timeshare as some sort of financial investment or real estate property, I think of it quite differently.

For me, it’s an investment in pre-paid family vacations. It’s a sunk cost and is discretionary spending as far as I'm concerned. The value is in the useage.

When I can't use it any more, rent it anymore, gift it any more, or pay the MF anymore, I will just dump it without any concern!

My vacation experiences will still be tightly secured in the depths of my brain cells until I expire.

That’s all there is to it for me. Nothing more, nothing less. No worries about it either.

I agree with you regarding the value is in the usage. I own 2 off-season Marriott weeks (purchased resale) and expect I'll likely give them away (and maybe pay for closing) when they no longer work for me. At least I know that someone else can purchase and use them with the same restrictions of all Marriott resale weeks.

I wouldn't purchase points with the expectation I could sell them for a significant amount in the future. I realize that the value is in the use and I don't expect to recover much $$ from my timeshare purchases.

My frustration was a lack of terms and conditions for the use of resale points. When I asked Marriott what the restrictions would be on resale use, they had no guidelines. A sales rep later speculated that owners of resale points might be limited to last minute reservations (60 days or less). I've heard of other restrictions, but have yet to see something in writing from Marriott. Maybe they don't want a resale market?

When you purchased a resale Marriott week you knew you could use it like a developer week, with the exception of trading it in for MR points. Two and a half years after the introduction of DC points we still don't know for sure how these resale points will be handled by Marriott.

 

[BocaBoy]

I'm one of those points’ purchasers and unlike many folks who continue to think of their timeshare as some sort of financial investment or real estate property, I think of it quite differently.

For me, it’s an investment in pre-paid family vacations. It’s a sunk cost and is discretionary spending as far as I'm concerned. The value is in the useage.

When I can't use it any more, rent it anymore, gift it any more, or pay the MF anymore, I will just dump it without any concern!

My vacation experiences will still be tightly secured in the depths of my brain cells until I expire.

That’s all there is to it for me. Nothing more, nothing less. No worries about it either.

I have noticed that many of your posts reflect an attitude of an economic status far in excess of most people. Even with a depreciating asset like a car, many people take resale value into consideration. And even more so with a timeshare purchase where there are annual maintenance fees that are not insignificant.

 

[LAX Mom]

I have noticed that many of your posts reflect an attitude of an economic status far in excess of most people. Even with a depreciating asset like a car, many people take resale value into consideration. And even more so with a timeshare purchase where there are annual maintenance fees that are not insignificant.

It isn't resale value that was my concern. It was the lack of a program so a potential buyer would know what they were buying and how to use it. Basically my concern was that I would purchase points that couldn't ever be sold because Marriott hasn't been clear the terms & conditions for using these points.

Why would I purchase something that you can't get rid of when your circumstances change?

 

[FractionalTraveler]

I have noticed that many of your posts reflect an attitude of an economic status far in excess of most people. Even with a depreciating asset like a car, many people take resale value into consideration. And even more so with a timeshare purchase where there are annual maintenance fees that are not insignificant.

That's fair commentary. My views are my own and I don't expect everyone to have similar views. That's what makes the world interesting.

To be honest, I have never taken resale value of a car into consideration. Thats an interesting topic. I guess my view would be to get whatever I can get after X number of years of use. I would derive my satisfaction not from the closing transaction's financial income but from the enjoyment I had in driving the vehicle.

I agree the MF's are not insignificant. I will have paid a TCO close to $500K in initial costs and MF by the time I turn 65. But that is just the cost of a second home somewhere nice. So with this perspective, not a bad deal at all for all those memories.

Emperical data from sales channels such as Marriott, ebay, Redweek, and owners here on TUG alike keep indicating that resale values are next to nothing. So I would expect these fancy points to have the same fate after all.

 

[FractionalTraveler]

It isn't resale value that was my concern. It was the lack of a program so a potential buyer would know what they were buying and how to use it. Basically my concern was that I would purchase points that couldn't ever be sold because Marriott hasn't been clear the terms & conditions for using these points.

Why would I purchase something that you can't get rid of when your circumstances change?

I agree. An exit strategy for any contractual obligation is essential to the deal.

 

[VacationForever]

It isn't resale value that was my concern. It was the lack of a program so a potential buyer would know what they were buying and how to use it. Basically my concern was that I would purchase points that couldn't ever be sold because Marriott hasn't been clear the terms & conditions for using these points.

Why would I purchase something that you can't get rid of when your circumstances change?

Exactly! I asked the sales rep a month ago on the process of unloading the points and he said process is yet to be developed. I said it would be foolish to buy without an exit strategy. I am not in my 30s who can enjoy the purchase for many years to come. My husband and I may have 5 or 10 years before we can no longer travel. I would not want to be stuck with a liability, even if it is just MF fees, without a way to unload it. When such a program is launched, the resale process should also have been put in place.

 

[FractionalTraveler]

Exactly! I asked the sales rep a month ago on the process of unloading the points and he said process is yet to be developed. I said it would be foolish to buy without an exit strategy. I am not in my 30s who can enjoy the purchase for many years to come. My husband and I may have 5 or 10 years before we can no longer travel. I would not want to be stuck with a liability, even if it is just MF fees, without a way to unload it. When such a program is launched, the resale process should also have been put in place.

When I purchased my trust points I did read the language which stated what a resale purchaser needed to pay in order to get the points from an owner.

It's so expensive that I didn't think anyone would be crazy enough to buy the points from me. I called it "Toxic" garbage since no one would touch it.

Here is what it says from the disclosure guide:

"Trust Members. Upon the sale of an Interest, Exchange Company may require the payment of an initiation fee. (The current initiation fee is $200 per Interest with a $2,000 minimum initiation fee; however, Exchange Company reserves the right to adjust the amount of the initiation fee from time to time and to waive the initiation fee on a case-by-case basis in Exchange Company’s sole and absolute discretion.) Until payment of any required initiation fee is received (or waived by Exchange Company), the owner of such Interest(s) will not be entitled to Base Plus Exchange Benefits or Exchange Benefits; however, payment of the initiation fee will allow access to the Base Plus Exchange Benefits. If the purchase of an Interest is not made from an Approved Broker, then the owner of such Interest(s) may not be entitled to Exchange Benefits in Exchange Company’s sole and absolute discretion, even if the initiation fee is paid. Additional payments may be required to access the Exchange Benefits.

FT

 

[dioxide45]

When I purchased my trust points I did read the language which stated what a resale purchaser needed to pay in order to get the points from an owner.

It's so expensive that I didn't think anyone would be crazy enough to buy the points from me. I called it "Toxic" garbage since no one would touch it.
<snip>

The problem with this is if MVCI isn't taking these back, it pretty much gives the owner no way out except foreclosure. Perhaps MVCI sees this as a cheaper option than ROFR or buyback?

 

[FractionalTraveler]

The problem with this is if MVCI isn't taking these back, it pretty much gives the owner no way out except foreclosure. Perhaps MVCI sees this as a cheaper option than ROFR or buyback?

Bingo. You are so correct. Marriott also believes their points product is disposable.

 

[m61376]

At least today there is the likelihood of finding a buyer for any Marriott week (even if the selling price approaches $0 for some weeks). Whether for personal use or as a trader in II, owners can find a use for their weeks. Resale points may (or may not) be a different issue. If they are truly valueless to the buyer, then the owner won't be able to give them away, yet obligated forever to pay MF's.

To a certain degree I agree that timeshare purchases aren't a monetary investment but an investment in lifestyle. But the obligation factor can't be ignored, and while the lifestyle value may be worth accepting that the resale value may approach nil, there is very real concern when it may forever have incurring costs.

 

[LAX Mom]

Here is what it says from the disclosure guide:

"Trust Members. Upon the sale of an Interest, Exchange Company may require the payment of an initiation fee. (The current initiation fee is $200 per Interest with a $2,000 minimum initiation fee; however, Exchange Company reserves the right to adjust the amount of the initiation fee from time to time and to waive the initiation fee on a case-by-case basis in Exchange Company’s sole and absolute discretion.) Until payment of any required initiation fee is received (or waived by Exchange Company), the owner of such Interest(s) will not be entitled to Base Plus Exchange Benefits or Exchange Benefits; however, payment of the initiation fee will allow access to the Base Plus Exchange Benefits. If the purchase of an Interest is not made from an Approved Broker, then the owner of such Interest(s) may not be entitled to Exchange Benefits in Exchange Company’s sole and absolute discretion, even if the initiation fee is paid. Additional payments may be required to access the Exchange Benefits.

FT

Interesting language. Thanks for posting this, it's the first time I've seen this provision. I don't think this was available on June 20, 2010 when the points program was introduced because none of the reps could tell me what rights a resale purchaser would have in the new DC points program. They repeatedly said "we'll have information on resales points usage eventually, but it hasn't been approved yet".

I have bolded the language that concerns me. If you don't purchase from an approved broker then you may not be entitled to exchange benefits , even if the initiation fee is paid. Additional payments may be required to utilize the exchange benefits.

Marriott reps have told me several times that eventually Marriott will have approved brokers for resale points. I don't think they do yet, but once they do it appears that may be the only option for selling your DC points. Marriott is trying to control the resale market.

 

[dioxide45]

Interesting language. Thanks for posting this, it's the first time I've seen this provision. I don't think this was available on June 20, 2010 when the points program was introduced because none of the reps could tell me what rights a resale purchaser would have in the new DC points program. They repeatedly said "we'll have information on resales points usage eventually, but it hasn't been approved yet".

I have bolded the language that concerns me. If you don't purchase from an approved broker then you may not be entitled to exchange benefits , even if the initiation fee is paid. Additional payments may be required to utilize the exchange benefits.

Marriott reps have told me several times that eventually Marriott will have approved brokers for resale points. I don't think they do yet, but once they do it appears that may be the only option for selling your DC points. Marriott is trying to control the resale market.

Similar language has always existed in the Exchange Procedures document. This isn't anything new. The language to limit resales has always been there. If they limit resale trust points from exchanging, then perhaps they still have full access to trust weeks, since that is what they own. In fact it was mentioned in one of their earnings call that resale purchases would only have access to trust inventory.

 

[4Reliefnow]

Cheap points are on the market

I have read posts about the costs Marriott has loaded on points resale. Don't recall the number, but, tree are transfer fees and enrollment fees and deed fees and it adds up to more than $5 a point.

That is like me selling my 2,775 point Grande Vista and Marriott adding fees of $13,000. Now , you can buy a 2br plat MGV for $3,000 so that fee is crazy.

I have seen points on eBay and Redweek at $2, but with the fees , another week seems a better value.

 

[Clark]

I cannot think of any other thing where the average buyer really understands so little about what they are buying.