First Purchase

[theslice]

My wife and I working on our first purchase, resale. Looking for veteran input. We are using an agent that has been mentioned in the threads multiple times that people have used but the process seemed a little odd to us.

I have attached a form (Removed sensitive details) we received and that they are asking for the initial deposit. I thought before sending in even a deposit we would see a deed or estoppel letter. This form seemed very basic, was expecting more legal jargon to review.

Does this seem right to folks?

 

[silentg]

I didn’t like the comment on the bottom saying they would not advise you to rescind.
I advise you to rescind, seems too expensive for a resale.
Silentg

 

[natarajanv]

My wife and I working on our first purchase, resale. Looking for veteran input. We are using an agent that has been mentioned in the threads multiple times that people have used but the process seemed a little odd to us.

I have attached a form (Removed sensitive details) we received and that they are asking for the initial deposit. I thought before sending in even a deposit we would see a deed or estoppel letter. This form seemed very basic, was expecting more legal jargon to review.

Does this seem right to folks?

I have bought from them before, and I have my brother in law in contract with him right now waiting on a waiver. You will get the estoppel with the waiver. If Hilton exercise rofr you will get your deposit back. I would not worry about not seeing the estoppel before you signing the contract.

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[Finsadbel]

I didn’t like the comment on the bottom saying they would not advise you to rescind.
I advise you to rescind, seems too expensive for a resale.
Silentg

Agreed. Seems a little high, you can do way better.

 

[JJVGHNC]

$1500 to get 9600 points/year for $1100 MF seems high? Sure, some are given away, but for $0.12/point MF seems like great deal, even with $1500 purchase. It doesn't get any better than this, does it? Am I missing something? If you decide not to buy it, please pm me.

 

[SmithOp]

$1500 to get 9600 points/year for $1100 MF seems high? Sure, some are given away, but for $0.12/point MF seems like great deal, even with $1500 purchase. It doesn't get any better than this, does it? Am I missing something? If you decide not to buy it, please pm me.

Thats just the deposit, read again to see the full price.


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[CaliGirl08]

$12,000 purchase price plus $1,524 closing costs is high. MF very low but average is $1/pt or less to buy resale except Club locations.

 

[theslice]

Interesting, didn't think it was a bad price looking at ads, and also looking at http://www.rofr.net/. I know that site doesn't list points but there was one that was probably similar at 10K.

 

[dayooper]

Interesting, didn't think it was a bad price looking at ads, and also looking at http://www.rofr.net/. I know that site doesn't list points but there was one that was probably similar at 10K.

The purchase price is high, but not outrageously so. The closing costs are very high. I’m assuming you are paying title insurance and Hilton’s transfer fee. If not, than it’s extremely overpriced. Even if those are included in the costs, it’s still overpriced.

 

[RX8]

I think this is a very fair deal. The 9600 points in Vegas don’t come up very often so I expect a premium over the typical $1/point guide. The closing costs are just slightly high. The $1524 closing is broken out to $915 true closing cost which includes Hilton’s transfer fee. The remaining $609 is for the activation fee.

if I had to guess on Hilton’s retail price I would say at least $70,000.

 

[natarajanv]

I don't think the closing cost is high. The doc says $915 which includes Hilton’s transfer fee, estoppel fee, and process of escrow. So $409 + $72 + $434 = $915. So the actual closing/escrow cost is $434, which is not too high IMHO. Of course $609 activation is mandatory anyways.

BTW, you pay a premium to get a Platinum Boulevard 8400 or 9600 points (I agree you can get similar point pkg at orlando/Elara for $1 /point or even lower) . Even with Ebay purchase which is risky it will be about $1/point. With a reputed agent you get a piece of mind that everything will get done properly. For that yes, you are paying about $1000 - $1500 more, which is still worth it.

As a matter of fact, there are only a few 9600 listings on the market and they all ask 14k and above. Also this is the best time to buy, as Hilton will be less inclined to exercise buy back.

 

[Tamaradarann]

I don't think the closing cost is high. The doc says $915 which includes Hilton’s transfer fee, estoppel fee, and process of escrow. So $409 + $72 + $434 = $915. So the actual closing/escrow cost is $434, which is not too high IMHO. Of course $609 activation is mandatory anyways.

BTW, you pay a premium to get a Platinum Boulevard 8400 or 9600 points (I agree you can get similar point pkg at orlando/Elara for $1 /point or even lower) . Even with Ebay purchase which is risky it will be about $1/point. With a reputed agent you get a piece of mind that everything will get done properly. For that yes, you are paying about $1000 - $1500 more, which is still worth it.

As a matter of fact, there are only a few 9600 listings on the market and they all ask 14k and above. Also this is the best time to buy, as Hilton will be less inclined to exercise buy back.

I agree that since you are buying a Platinum Plus 3 BR you are getting 1200 more points per year for the same maintenance as a 3 BR Platinum the purchase price is going to be higher per point to purchase. There are not that many of these premium point packages around. If you feel the $12,000 is too much you could see what the broker has in a somewhat more standard 3 BR Platinum 8400 point package or 2 BR Platinum 7000 point package.

 

[CalGalTraveler]

What is the first year of use. Are you getting 2019 points? What year is the MF for 2019? or 2020?

 

[theslice]

What is the first year of use. Are you getting 2019 points? What year is the MF for 2019? or 2020?

No 2019 points. MF is for 2020 and will be the first year for our points.

 

[hurnik]

After reading through this, I think it's a decent deal. I was looking for one of these (they're difficult to find) and $14k on up is what they were going for, so $12k plus closing costs, especially for that low MF seems good to me. Could one maybe do better? Possibly, but you don't see the 9600 ones very often, IMO.

 

[theslice]

We decided to pull the trigger on the deal. I am sure there could be better deals out there but it was the points that we need for our first purchase and we will get our return in value in a short amount of time if we do nothing other than book our standard week vacation at a HGVC property. Looking forward to using the points and learning the quirks of the booking system.

 

[JJVGHNC]

I figured I was missing something and I was! But, as others have said it is still probably good, for 9600 points and that MF. I will add that I went to an hgvc presentation yesterday and was offered 7000 EY with $1281 MF for $60,000! So yes, I'd agree, minimum $70,000 retail.

 

[PigsDad]

I think it is a good deal as well. As others had noted, a 9600 point 3BR Plus unit deed does not show up that often, and I think this is a great deed, especially for someone who is looking to hold onto it for a long time. The MF/point ratio is very good, plus that property has been known for reasonable annual MF increases due to the size (scales of economy) and location (desert, low weather threats / insurance costs).

Kurt

 

[brp]

I think this is a very fair deal. The 9600 points in Vegas don’t come up very often so I expect a premium over the typical $1/point guide. The closing costs are just slightly high. The $1524 closing is broken out to $915 true closing cost which includes Hilton’s transfer fee. The remaining $609 is for the activation fee.

if I had to guess on Hilton’s retail price I would say at least $70,000.

Agreed. I was bidding on a 9600 pt. at the Boulevard a little while back. It went for $9512 (my bid with 3 seconds left was $9412 ).

I just got a 9600 pt. package at the Boulevard for $6250, but it is 2 4800 pt. Platinum units, so the MF ratio is good, but the transfer fee will be double and somewhat more cumbersome to sell. So, only about $0.65/point, but with come baggage.

Cheers.

 

[terces]

Agreed. I was bidding on a 9600 pt. at the Boulevard a little while back. It went for $9512 (my bid with 3 seconds left was $9412 ).

I just got a 9600 pt. package at the Boulevard for $6250, but it is 2 4800 pt. Platinum units, so the MF ratio is good, but the transfer fee will be double and somewhat more cumbersome to sell. So, only about $0.65/point, but with come baggage.

Cheers.

Could I ask what you expect to pay for annual MF's on the 2 x 4800 points?

 

[brp]

Could I ask what you expect to pay for annual MF's on the 2 x 4800 points?

It looks like about $1260 total for both, so about $0.13. I think the full 9600 (3BR, I think) had a slightly better ratio.

Cheers.

 

[Finsadbel]

$1500 to get 9600 points/year for $1100 MF seems high? Sure, some are given away, but for $0.12/point MF seems like great deal, even with $1500 purchase. It doesn't get any better than this, does it? Am I missing something? If you decide not to buy it, please pm me.

Just stating that the purchase price seemed high, since there have been others that sold for thousands cheaper. We all make decisions based on what’s best for us. I’m a cheapskate! Lol!

 

[CalGalTraveler]

If we apply the $1 a point rule of thumb, this is a high buy-in price at $12k for 9600 points. I wouldn't do it unless I could get closer to $9600 price.

I am inclined to go with faster Breakevens these days given program uncertainties. The low MF/point strategy works as a long game as long as the HGV points system continues to be flexible as it is today 10 -20 years from now.

Hmmm...back-of-the-envelope breakeven (BE) compares:

a) 2-4800s for low price but slightly higher MF/point. I believe @brp said he paid $6500

or

b) 9600 $12,000 but only $1,100 mf/year

so assuming the MF difference is $300 (perhaps @brp could get me an exact answer) it would take:

$5500 difference / $300 = 18 years to BE over @brp option.

If you put $5,500 in the bank at 2% interest that's $110/year less so $190 actual difference so

$5,500 difference/$190 net difference after interest) = 28 years to Breakeven

18 - 28 years is a long time to me.

IMHO I would be going for a 7k unit at $1 a point or lower and borrow points from future years to start. If I consistently needed more points, I would get another 4.8 to 7k unit. Why 7k to start? because it's enough points to do something vs. 4800 and you can sell/exit more easily because these are popular units. If your needs change in the future, you can sell one of the units and keep one.

 

[brp]

To add specifics, I paid $6250 (but let's call it $6850 as we have two transfer fees). And the MF difference is closer to $200.

So the BE is about 26 years.

Cheers.

 

[CalGalTraveler]

So with @brp updates the breakeven is even longer if you add 2% interest per year keeping the $5500 difference in the bank:

$200 addl MF - $110 interest earned at 2% a year = $90 diff

Actually if you add the transaction costs into the $12,000 deal you are closer to $13,250 so the difference is about $6,400:

$6,400 / $90 Addl MF cost = 71 YEARS to breakeven!!!!

So @brp deal much better than this. But like I said, I would go for closer to $1 a point before I would consider a deal like this.

Bottom line: One needs to look at both purchase cost AND MF/point to evaluate a deal.

Interest earned (and compounded) will reduce the MF/point advantage when you deduct for interest that could be earned by saving upfront money from a bank over the years you own the unit.