HELP! Canyon Villas decision

[mvmess]

Your original post says:
"While it appears reasonable at face value, when considering the opportunity cost associated with the purchase price and the fact that we are 72 I am not certain it is.
I would love to hear your thoughts."

If you did the math already, then I'm at a loss to understand why you would think it appeared "reasonable at face value." I didn't factor in the lost opportunity cost either. At 72, given that you'd need to live to be 150 in order to recoup the capital outlay, regardless of the lost opportunity cost on that $35k, IMHO that is far from even seeming reasonable ever.

If you don't want that week, and you don't want to go to the effort to sell or give away to a third party, then contact MVC exit services and deed the unit back to MVC.

You cannot simply calculate the time it takes to offset the difference in maintenance fees. There is value in the purchase. The point difference is 1875 vs 4150. If you compute the value as it relates to simply reserving the same property paying cash. My calculations were expenses minus value. If the points purchase 10 nights in a property that would otherwise cost $600 per night, that is a $6,000 offset of the expense incurred to pay for the points. If you reserve the same 10 nights over a ten year period that equates to $60,000 in benefit. If I paid $35,000 up front and $18,000 in maintenance fees that results in a $7,000 positive position when compared to simply paying cash for the same property. That is a reasonable consideration until you consider opportunity cost.

The $35,000 invested in today’s market in a portfolio with moderate risk would likely double or more in ten years. NOW, the proposition becomes unreasonable!

 

[LeslieDet]

You cannot simply calculate the time it takes to offset the difference in maintenance fees. There is value in the purchase. The point difference is 1875 vs 4150. If you compute the value as it relates to simply reserving the same property paying cash. My calculations were expenses minus value. If the points purchase 10 nights in a property that would otherwise cost $600 per night, that is a $6,000 offset of the expense incurred to pay for the points. If you reserve the same 10 nights over a ten year period that equates to $60,000 in benefit. If I paid $35,000 up front and $18,000 in maintenance fees that results in a $7,000 positive position when compared to simply paying cash for the same property. That is a reasonable consideration until you consider opportunity cost.

The $35,000 invested in today’s market in a portfolio with moderate risk would likely double or more in ten years. NOW, the proposition becomes unreasonable!

You can rent Club Points from other owners without any capital outlay whatsoever, thus, there is no need to compute the value of reserving the property vs paying cash. And, frankly, you said it was you buying 2000 points and you would give up ownership of the one deeded week. If you are buying 4000 points, then the cost is even greater than the $35k. But whatever.

BTW - your math sounds like a misleading sales pitch.

 

[dioxide45]

You can rent Club Points from other owners without any capital outlay whatsoever, thus, there is no need to compute the value of reserving the property vs paying cash. And, frankly, you said it was you buying 2000 points and you would give up ownership of the one deeded week. If you are buying 4000 points, then the cost is even greater than the $35k. But whatever.

BTW - your math sounds like a misleading sales pitch.

While they were giving up the Canyon Villas week, MVC was giving them the equivalent number of Club Points that the week was worth. So in essence 2,000 points purchased plus 1,875 trust points for the week. really just another 2K since you can't have 3,875 trust points.

 

[Dean]

We own a Gold week at Marriott’s Canyon Villas. Why! You ask? It was part of a package purchased 20 years ago. As I am certain several of you know, the maintenance fees for this week are the same as a Platinum week. We are currently visiting Shadow Ridge and have been presented with an offer. If we purchase 2,000 Destination points at a cost of $17.71 per point Marriott will retire the deed and move the 1,875 DP exchange value into my account. No more maintenance fees for the Gold week.

While it appears reasonable at face value, when considering the opportunity cost associated with the purchase price and the fact that we are 72 I am not certain it is.

I would love to hear your thoughts.

Lots of great advice and info for you to consider has been presented. I think the idea of giving up the week and buying points to replace plus the added points purchase is a poor choice. If you don't want the week you can get rid of it by selling or giving it back to MVC. I suspect they'll take it. However, if you reserve a top gold week week and exchange it, you can get a better value than the points, esp if you lock it off and get 2 weeks for the one. Even if you wanted to trade it in, there are other options IMO. You could trade in and buy a better week for Aruba with similar costs but more options, a better underlying value and lower fees still. I'm not sure about Spain if that can be done there. For most any trade in purchase is not going to be a good choice but I am pointing out there are other possibilities.

 

[aklausing]

At the top of the page, click on 'search forums" and type in "shadow ridge remodels" and it will show up. Last Post was Nov 26.

Oh, it's a thread within a forum. I was hoping that there was a forum within Marriott Group that would be dedicated to remodel updates for all Marriott Timeshare Resorts. Might a general remodel thread be a useful sticky thread?

 

[LeslieDet]

While they were giving up the Canyon Villas week, MVC was giving them the equivalent number of Club Points that the week was worth. So in essence 2,000 points purchased plus 1,875 trust points for the week. really just another 2K since you can't have 3,875 trust points.

I sincerely doubt that MVC would "give" them ownership of any points in addition to the 2000 being purchased. Yes, BIs are in 250 point increments. There may have been some one time bonus points pitched, but those are one time usage, not given for free year after year.

If the OP really thinks he was going to be receiving access to an additional 4150 points per year (which frankly makes no sense, as you cannot buy 4150 points either), he was definitely going to be purchasing those additional points. It would not be a gift each and every year. And, that reference to it being 4150 points vs 1875, sounds to me like this was a pitch to buy a bundle. But I'm just speculating since, as you well know, the MVC Trust Points need to be in increments of 250.

 

[dioxide45]

I sincerely doubt that MVC would "give" them ownership of any points in addition to the 2000 being purchased. Yes, BIs are in 250 point increments. There may have been some one time bonus points pitched, but those are one time usage, not given for free year after year.

If the OP really thinks he was going to be receiving access to an additional 4150 points per year (which frankly makes no sense, as you cannot buy 4150 points either), he was definitely going to be purchasing those additional points. It would not be a gift each and every year. And, that reference to it being 4150 points vs 1875, sounds to me like this was a pitch to buy a bundle. But I'm just speculating since, as you well know, the MVC Trust Points need to be in increments of 250.

It's not 4150 additional points. It would be an additional 2,125 points. They get 4000, they give back the MCV week worth 1875. They likely have to pay for 2,125 points at the discounted rates.

I suspect the 4,150 points is just something the OP is talking about without actually having all of the details of the deal and also their mental recollection of what they were told.

MVC has offered equity trade ins, unlike they have done in the past. In the past they would give you the price originally paid for the week as equity toward additional point purchase. This past year we were pitched that if we bought at least 2,000 we could turn in a deeded week and take out the equivelent number of trust points. Though as you stated, and as I DID TOO, can only be sold/bought in 250 point increments.

If I understand everything correctly the OP would get 16 new Beneficial Interests while paying for 2,125 points and giving up their MCV week. If MVC would have actually done such a deal is another story, but they've seemed pretty desperate lately.

 

[davidvel]

If I am reading the OP at face value, the deal is for MVC to sell them 2,000 pts at 17.71/pt ($35,420.) They would also take back the week and "give" them an additional 1,875 points.

I have not seen deals like this. However, if true, it would be essentially a purchase of 3,875* points for the $35K, which is just over $9/pt. This is less than the hybrid sales deals, and MVC acquires the Canyon Villas deed for free that they can convert to points and sell for another $15k-$20K.

Marriott has been known to sell hybrid enrolled deeds+points deals for around $8 a point so this seems like a steal for MVC in comparison.

*I'm ignoring the beneficial interest #s for now.

 

[frank808]

OP can already convert their week to points already.

I would just rent the 2000 points a year for 80cents a point since they are an enrolled owner. That would take 22 years for OP to break even from the $35K they were paying for these 2000 trust points. If you put that $35K into a laddered CD to rent points each year, it would take you probably close to 40 years to deplete that $35K purchase price of 2000 points.

With those figures, why buy? Just rent what you need till you are 112 for the same amount of money. The best part, if youbdont need those 2000 points that particular year, don't rent them.

Sent from my SM-S928U using Tapatalk

 

[LeslieDet]

Though as you stated, and as I DID TOO, can only be sold/bought in 250 point increments.

Yes, I know you also said that. Why are YOU YELLING?

What is missing from this entire post is any reference to the "buyback" at original price or any credit whatsoever. He simply said he was "retiring the deed". Obviously not a legal term. It really doesn't matter, but regardless whether the OP gave back the week and bought 2k points or sold back the week back to MVC for his original purchase price and then purchased 4000 points, there is no gift in that computation. Nothing is free.

And while sales styles it as an "equity trade in" and so many folks fooled into doing that think they simply "upgraded", the legal transaction is a sale of the existing ownership and a purchase of new ownership. The OP would receive a 1099 for the sale price received, which is applied (as you already know) as a credit against the purchase. The OP is going to have to pay MFs on the 4000 points. And, all the while he could have simply kept his week, rented points if needed, and not be out of pocket to buy points and then the ongoing MFs on those 4000 points, especially at age 72.

 

[dioxide45]

Yes, I know you also said that. Why are YOU YELLING?

What is missing from this entire post is any reference to the "buyback" at original price or any credit whatsoever. He simply said he was "retiring the deed". Obviously not a legal term. It really doesn't matter, but regardless whether the OP gave back the week and bought 2k points or sold back the week back to MVC for his original purchase price and then purchased 4000 points, there is no gift in that computation. Nothing is free.

And while sales styles it as an "equity trade in" and so many folks fooled into doing that think they simply "upgraded", the legal transaction is a sale of the existing ownership and a purchase of new ownership. The OP would receive a 1099 for the sale price received, which is applied (as you already know) as a credit against the purchase. The OP is going to have to pay MFs on the 4000 points. And, all the while he could have simply kept his week, rented points if needed, and not be out of pocket to buy points and then the ongoing MFs on those 4000 points, especially at age 72.

I certainly don't think it is a good value proposition. As to the "trade-in" the OP did indicate the following; "Marriott will retire the deed and move the 1,875 DP exchange value into my account." I took that to mean the 1875 exchange points would be traded for a like number of trust points.

Though it could all be smoke and mirrors.

 

[LeslieDet]

I certainly don't think it is a good value proposition. As to the "trade-in" the OP did indicate the following; "Marriott will retire the deed and move the 1,875 DP exchange value into my account." I took that to mean the 1875 exchange points would be traded for a like number of trust points.

Though it could all be smoke and mirrors.

And I took it to mean that the OP did not understand what he was doing, since you can't "retire" a deed. It sounded to me like he was getting the Club Points that week was valued at put into his account for 2025 to use even though he was giving up the ownership, presumably because he'd already paid the 2025 MFs.

 

[davidvel]

And I took it to mean that the OP did not understand what he was doing, since you can't "retire" a deed. It sounded to me like he was getting the Club Points that week was valued at put into his account for 2025 to use even though he was giving up the ownership, presumably because he'd already paid the 2025 MFs.

Maybe the salesperson wasn't a lawyer?

 

[dioxide45]

And I took it to mean that the OP did not understand what he was doing, since you can't "retire" a deed. It sounded to me like he was getting the Club Points that week was valued at put into his account for 2025 to use even though he was giving up the ownership, presumably because he'd already paid the 2025 MFs.

You seem to get hung up on terminology a lot. I take "retire" to mean to deed it back to MVC. You and I know that the deed doesn't go away but you kinda have to read between the lines to figure out what sales is saying or what someone who went to a presentation comes back with. What really matters is the contract, which we will never know how such a deal would have been structured since the OP didn't follow through on it.

 

[daviator]

You seem to get hung up on terminology a lot. I take "retire" to mean to deed it back to MVC. You and I know that the deed doesn't go away but you kinda have to read between the lines to figure out what sales is saying or what someone who went to a presentation comes back with. What really matters is the contract, which we will never know how such a deal would have been structured since the OP didn't follow through on it.

Although “retire the deed” doesn’t mean anything legally, in this case I think the meaning is actually kind of clear. Marriott would buy back the deed and add it to the Abound trust. The deed is then “retired” because they are never, at least in theory, ever going to sell that VOI as a deeded week again. “Retire the deed” seems pretty descriptive and even accurate, speaking from the perspective of MVC sales. The Trust is where deeded weeks go to die, in a sense, because they go in but never come out.

However, in a legal sense, nothing dies – and all those deeded weeks which have been “retired” to the trust continue to be separately assessed and billed by the local property tax entities. In that sense they will live forever, or until the property is bulldozed.

 

[LeslieDet]

Although “retire the deed” doesn’t mean anything legally, in this case I think the meaning is actually kind of clear. Marriott would buy back the deed and add it to the Abound trust. The deed is then “retired” because they are never, at least in theory, ever going to sell that VOI as a deeded week again. “Retire the deed” seems pretty descriptive and even accurate, speaking from the perspective of MVC sales. The Trust is where deeded weeks go to die, in a sense, because they go in but never come out.

However, in a legal sense, nothing dies – and all those deeded weeks which have been “retired” to the trust continue to be separately assessed and billed by the local property tax entities. In that sense they will live forever, or until the property is bulldozed.

I've never heard anyone refer to a deed back as "retiring the deed" - ever. But it is frankly irrelevant at this point. Also, we do not know that it would be intended to be conveyed to the MVC Trust. While MORI has unfettered discretion to add to the Trust, many times cheaper weeks are sold as part of bundles. It is all speculation.

 

[Foggy1]

Brian. Time to close this thread?

 

[jellen613]

If I am reading the OP at face value, the deal is for MVC to sell them 2,000 pts at 17.71/pt ($35,420.) They would also take back the week and "give" them an additional 1,875 points.

I have not seen deals like this. However, if true, it would be essentially a purchase of 3,875* points for the $35K, which is just over $9/pt. This is less than the hybrid sales deals, and MVC acquires the Canyon Villas deed for free that they can convert to points and sell for another $15k-$20K.

Marriott has been known to sell hybrid enrolled deeds+points deals for around $8 a point so this seems like a steal for MVC in comparison.

*I'm ignoring the beneficial interest #s for now.

We have been offered this "deal" a couple of times in the last 2-3 years at presentations. Marriott gives us equity credit for what we paid for our Barony Beach gold week. The Barony Beach deed goes back to Marriott, we buy a bundle of 2000 points (with our equity credit applied), and they add the amount of points our Barony week is worth (annually) to our portfolio. We have not done the deal as we do not need more points and the maintenance fees on our Barony Beach are less than the maintenance fees for the points value of our Barony Beach, at least for now. Our current portfolio is an enrolled gold week worth 2700 Abound points, and 2500 abound points: 5200 points. So they have been trying to get us to purchase more to get to Executive.

 

[vol_90]

Brian. Time to close this thread?

Too entertaining to close the thread right now!

 

[dioxide45]

I've never heard anyone refer to a deed back as "retiring the deed" - ever. But it is frankly irrelevant at this point. Also, we do not know that it would be intended to be conveyed to the MVC Trust. While MORI has unfettered discretion to add to the Trust, many times cheaper weeks are sold as part of bundles. It is all speculation.

Bundles come from the Marriott resale program, not deed backs. We were pitched a bundle yesterday and were told that the resale week can take up to three months to close because they are resale weeks and still have to work with the current owner to convey the deed.

 

[dioxide45]

Marriott gives us equity credit for what we paid for our Barony Beach gold week.

This is a different kind of equity trade in and one that I referred to previously in this thread. It seems that within the past year MVC is now offering the ability to trade in the deed and get the equivalent value of points in return as long as you purchase at least 2,000 Abound Club Points. They don't give you a dollar amount toward your purchase. If this is a real offer remains to be seen as I don't know of anyone who has actually done it, but it was pitched to us at least once last year.

It is also likely that the point value they give to the deed being traded in is based on the value they apply to it when it goes into the trust which is actually, in most cases, a little bit less than the exchange value.

 

[dioxide45]

Brian. Time to close this thread?

That is what the "report" button is for.

 

[LeslieDet]

You seem to get hung up on terminology a lot.

Absolutely. It’s because the details matter. In order to help others, details are important.

 

[jellen613]

This is a different kind of equity trade in and one that I referred to previously in this thread. It seems that within the past year MVC is now offering the ability to trade in the deed and get the equivalent value of points in return as long as you purchase at least 2,000 Abound Club Points. They don't give you a dollar amount toward your purchase. If this is a real offer remains to be seen as I don't know of anyone who has actually done it, but it was pitched to us at least once last year.

It is also likely that the point value they give to the deed being traded in is based on the value they apply to it when it goes into the trust which is actually, in most cases, a little bit less than the exchange value.

This seems like a worse deal then, that they wouldn't give equity credit to the purchase of the 2000 points. That is what even piqued my interest in permanently converting my week. Or maybe I have mis-understood the deal (as I have no interest in buying more deeds or points). We did briefly in 2019 purchase more points to get to executive, however rescinded when we thought more about it.
They have tried numerous "deals" and "bundles" to get us to executive. I don't want the maintenance fees associated with having that many points or deeds.

 

[mvmess]

You can rent Club Points from other owners without any capital outlay whatsoever, thus, there is no need to compute the value of reserving the property vs paying cash. And, frankly, you said it was you buying 2000 points and you would give up ownership of the one deeded week. If you are buying 4000 points, then the cost is even greater than the $35k. But whatever.

BTW - your math sounds like a misleading sales pitch.

Thanks! But, You are lost! Please do not respond to this thread any more.