2026 Maintenance Fees Discussion

[dioxide45]

So, apparently, sometime during the Q2 earnings call today it was mentioned in the prepared remarks that maintenance fees should be "flattish" in 2026. I can't actually find those remarks by one of the MVW execs and only heard it referenced during the Q&A. Anyway, that might be some good news. Whatever "flattish" means by MVCs definition.

 

[iftravel]

So, apparently, sometime during the Q2 earnings call today it was mentioned in the prepared remarks that maintenance fees should be "flatish" in 2026. I can't actually find those remarks by one of the MVW execs and only heard it referenced during the Q&A. Anyway, that might be some good news. Whatever "flatish" means by MVCs definition.

5% is the new flat.

 

[billymach4]

So, apparently, sometime during the Q2 earnings call today it was mentioned in the prepared remarks that maintenance fees should be "flatish" in 2026. I can't actually find those remarks by one of the MVW execs and only heard it referenced during the Q&A. Anyway, that might be some good news. Whatever "flatish" means by MVCs definition.

Well I asked the Google and it's actually in the dictionary.

 

[vol_90]

So, apparently, sometime during the Q2 earnings call today it was mentioned in the prepared remarks that maintenance fees should be "flatish" in 2026. I can't actually find those remarks by one of the MVW execs and only heard it referenced during the Q&A. Anyway, that might be some good news. Whatever "flatish" means by MVCs definition.

From earnings call transcript:
Benjamin Nicolas Chaiken

Got it. Understood. And then I believe in the prepared remarks, you mentioned a 12.5% loan loss provision is the expectation for the year. Can you just remind us, how does that compare to your previous expectation? And then maybe parallel to that, I believe you mentioned that the maintenance fees should be flattish in '26 in part because of some of the modernization initiatives. Do you think that will show up in -- I guess, like theoretically, should that show up in an improvement in loan loss provision?

Jason P. Marino

Yes, Ben. So the 12.5% is about 0.5 point higher than our previous guidance, which was about 12% for the full year. The modernization and the lower maintenance fees, we certainly, if you go back a couple of years, I think some of the delinquencies that we had were attributable to the higher-than-normal inflationary increases or the higher inflation. So we do think that will help going forward. But the loan book is in good shape, as we talked about, with delinquencies down to really the lowest levels in 2 years, both on a sequential and a year-over-year basis being down pretty materially 110 basis points year-over-year on the delinquencies. So we feel good about where the loan book is.

John E. Geller

Yes. Keeping the maintenance fees not -- flattish, just big picture, that obviously helps with the value proposition, right? Maintenance fee is a component of the long-term cost of prepaying or buying timeshare. So everything we can do to continue to enhance the value proposition, we think it helps from a sales perspective, hopes from an owner satisfaction perspective, should have some impact, hopefully positive on our loan loss. So it is and will continue to be a focus.

 

[CalGalTraveler]

I guess the coin has finally clicked in that MFs affect value and delinquency. However I will believe "Flatish" when I see it.

IMO "Freeish" would be better.

 

[JIMinNC]

IMO "Freeish" would be better.

“Freeish” reminds me of two very wise statements:

“There is no such thing as a free lunch”

and

“Anything one person gets for free has to be paid for by somebody else.”

 

[VacationForever]

Maybe flatish means it is not 10%.

 

[cubigbird]

I would guess that maintenance fees (and developer sales pricing) are already at the top of market tolerance. They have to be careful, they can always ask for huge fee increases but if they do increase it by double digit %, they’ll see delinquency soar even higher. The higher the fees become, the harder it will be for sales, and it’s already an expensive product. They’re going to have to flatten out fees for a bit and offer reprieve or the whole system will start collapsing.

 

[pedro47]

Nothing is free. Someone must pay and someone will pay at the end.

 

[sponger76]

IMO "Freeish" would be better.

Free-ish would mean that the resorts would completely van-ish as timeshare locations. Would that really be better? Maybe for some that want out of their timeshares, but for those of us that want to keep using our ownership, not so much.

 

[gravityrules]

Loan loss provision - 12.5%

Would the delinquency rate be higher or lower than the loan loss provision rate?

Delinquency rate is said to be 1.1% lower than a year ago.

 

[CalGalTraveler]

Free-ish would mean that the resorts would completely van-ish as timeshare locations. Would that really be better? Maybe for some that want out of their timeshares, but for those of us that want to keep using our ownership, not so much.

FWIW...I was referring to 0% increase from current maintenance fees

I hope you realize my statement was in jest because there isn't a MF increase that MVC/Vistana does not like.

 

[sponger76]

FWIW...I was referring to 0% increase from current maintenance fees

I hope you realize my statement was in jest because there isn't a MF increase that MVC/Vistana does not like.

Free and no increase are two completely different things in the English language. With that being said, I do realize it was at least somewhat in jest, which is why I replied with my own joke transfering the "ish" from the end of your "freeish" to the end of vanish afterwards.

 

[jmhpsu93]

I'm reading those statements as that they have a ton of control over maintenance fee increases, that it's not necessarily solely due to local cost increases, and it's discretionary by the developer. Maybe more so that even TUG'ers have noted.

 

[dioxide45]

I'm reading those statements as that they have a ton of control over maintenance fee increases, that it's not necessarily solely due to local cost increases, and it's discretionary by the developer. Maybe more so that even TUG'ers have noted.

They do. The budget is put together by Marriott Vacations. Each resort has a financial person. That person may manage a few resorts, but there is a dedicated employee working on financials for each resort. If Marriott decides they want to spend a bunch of money on something, they just put it in the budget. If they want to cut back on some things, they can do that too.

 

[Bodie]

From earnings call transcript:
Benjamin Nicolas Chaiken

Got it. Understood. And then I believe in the prepared remarks, you mentioned a 12.5% loan loss provision is the expectation for the year. Can you just remind us, how does that compare to your previous expectation? And then maybe parallel to that, I believe you mentioned that the maintenance fees should be flattish in '26 in part because of some of the modernization initiatives. Do you think that will show up in -- I guess, like theoretically, should that show up in an improvement in loan loss provision?

Jason P. Marino

Yes, Ben. So the 12.5% is about 0.5 point higher than our previous guidance, which was about 12% for the full year. The modernization and the lower maintenance fees, we certainly, if you go back a couple of years, I think some of the delinquencies that we had were attributable to the higher-than-normal inflationary increases or the higher inflation. So we do think that will help going forward. But the loan book is in good shape, as we talked about, with delinquencies down to really the lowest levels in 2 years, both on a sequential and a year-over-year basis being down pretty materially 110 basis points year-over-year on the delinquencies. So we feel good about where the loan book is.

John E. Geller

Yes. Keeping the maintenance fees not -- flattish, just big picture, that obviously helps with the value proposition, right? Maintenance fee is a component of the long-term cost of prepaying or buying timeshare. So everything we can do to continue to enhance the value proposition, we think it helps from a sales perspective, hopes from an owner satisfaction perspective, should have some impact, hopefully positive on our loan loss. So it is and will continue to be a focus.

I don't speak or read Klingon.

 

[vol_90]

Things may change before finalized:

 

[Fasttr]

Trust points proposed budget with assumed waiver of fully funding, has MF per BI for 2026 = $204.35, up from $203.70, or a 0.32% increase, which is in line with the "flattish" comment in the earnings Q&A.

That would put 2026 MF/point at 81.74 cents.

 

[DanCali]

But the CEO said

"And while not part of our expected $150 million to $200 million EBITDA benefit, early indications suggest maintenance fees on our points-based products may be flattish next year, partially due to our modernization initiatives, which enhances the overall value proposition for our owners, as well as our first-time buyers.?

https://ir.marriottvacationsworldwide.com/static-files/b835f4ed-1998-47df-9276-129f44d0544d (page 4)

I guess 6.3% is "flattish" compared to 2023 and 2024....

 

[Fasttr]

You posted the version with no waiver of fully funding. Historically, it has gotten waived. See my post below.... which supports the "flattish" comments.

"Flattish" Maintenance Fees in 2026

So, apparently, sometime during the Q2 earnings call today it was mentioned in the prepared remarks that maintenance fees should be "flattish" in 2026. I can't actually find those remarks by one of the MVW execs and only heard it referenced during the Q&A. Anyway, that might be some good news...

tugbbs.com

 

[vol_90]

You posted the version with no waiver of fully funding. Historically, it has gotten waived. See my post here.... which supports the "flattish" comments.

"Flattish" Maintenance Fees in 2026

So, apparently, sometime during the Q2 earnings call today it was mentioned in the prepared remarks that maintenance fees should be "flattish" in 2026. I can't actually find those remarks by one of the MVW execs and only heard it referenced during the Q&A. Anyway, that might be some good news...

tugbbs.com

Just sharing what they sent via e-mail today with a note that changes may occur before finalized. Let the 2026 maintenance fee discussions begin

 

[Fasttr]

Just sharing what they sent via e-mail today with a note that changes may occur before finalized. Let the 2026 maintenance fee discussions begin

Look at the Alternative Budget in the same email. That is the one that has historically been approved.

 

[kozykritter]

Alternative budget is 0.4% increase on the financial chart but the text of the email says 0.3% increase to add 1 cent to current fees and new rate 82 cents per point. They don't want to seem to deal with fractions but they will charge us the full rate with fractions in the end. They are raising the Club Fee for the third year in a row...another $10 on Executive.

 

[kozykritter]

Dear MVC Trust Owner:

A regular meeting of the Board of Directors of MVC Trust Owners Association, Inc. is scheduled for 9:00 a.m., Eastern time, on September 4, 2025, at Marriott’s Lakeshore Reserve, Stanza Italia, 11248 Lakeshore Reserve Drive, Orlando, Florida 32837 (see Agenda).

At this meeting, the Board of Directors will consider the MVC Trust Owners Association, Inc. budget and approve the resulting assessments for the 2026 fiscal year.

Please carefully review the reserve funding line item on the enclosed “Proposed Budget”. Florida law requires MVC Trust Owners Association, Inc. to submit a Proposed Budget that includes “fully funded” reserves based on statutory formula, unless a majority of the Owners vote to waive or reduce the reserve funding as permitted by the State of Florida.

As such, the Proposed Budget includes reserves of $11.95 per beneficial interest, ensuring compliance with the statutory formula. If MVC Trust Owners do not waive the fully funded requirement, the Association is required to fully fund the difference between a component association’s fully funded reserve amounts and that component association’s waived reserves. In 2025, the underlying component associations’ Owners waived fully funding within their budgets, and the “Proposed Budget” reserves estimate is based on the 2025 actual difference of fully funding plus an inflation factor for 2026.

Also enclosed is an “Alternative Budget” that is not officially proposed but will be considered should MVC Trust Association Owners elect to waive fully funding. The Board is authorized to potentially lower the reserve funding amount below the amount shown in the Proposed Budget only if a majority of Owners vote “yes” to waive or reduce the “fully funded” reserve funding shown in the Proposed Budget. The Board may also determine to provide increased reserve funding in the final budget.

The Board of Directors reviews the Association’s reserve funding needs on a regular basis and will do so again at this meeting. The goal has been and remains to maintain a balanced approach in reserve contributions versus projected expenditures for the Association.

For 2026, the “Proposed Budget” and “Alternative Budget” for the MVC Trust Owners Association reflect a maintenance fee payable from the MVC Trust Owners Association to the underlying component associations with a 0.8% increase over 2025, reflected in the “Component Expense” line item. The 0.8% increase in component expenses underscores the Management Company’s commitment to controlling cost and minimizing the financial impact to Owners. The line item “Component Expenses” of the “Alternative Budget” is approximately 86% of the total budgeted expenses for MVC Trust Owners Association. The increase per beneficial interest is offset by a surplus return and lowered administrative costs.

Thus, the projected increase to the MVC Trust Owners’ maintenance fees in the “Alternative Budget” is $0.01 per point, resulting in a $0.82 per point annual maintenance fee which represents a 0.3% increase.

 

[dioxide45]

Can owners attend the annual meeting?