How do most people finance resales?

[2rebecca]

This sounds like CareCredit by Synchrony Bank. They give you a 0% promotional interest rate and if there’s even a $.01 balance after the promo period ends, they’ll charge you all the accrued interest to date, at a rate ~25%. If it’s not illegal, it absolutely should be

I didn't think about CareCredit being available for Vet bills, but you're probably right. We were all surprised anyone gave her an unsecured loan for that amount of money.

 

[Fido Chuckwagon]

If you really need to get a loan, why not get a home equity loan then pay it off in 12 months like you were planning originally?

Companies like Monera make DVC loans because the contract is the collateral. If you don't pay the loan, they take the contract. I paid more than $19,000 for my DVC timeshare, but paid cash. When it comes to timeshare purchases, pay as you go it the way to go.

The pro move is probably:
1. Open a HELOC But don’t use it; and
2. Take advantage of zero percent financing offers no credit cards.

This gets you a lower interest rate than what you would have from the HELOC, but the HELOC is there in case of an emergency if you find you can’t pay off the credit card before the rate resets.

I still would not recommend this for financing a timeshare though.

 

[Wolfgheist]

The pro move is probably:
1. Open a HELOC But don’t use it; and
2. Take advantage of zero percent financing offers no credit cards.

This gets you a lower interest rate than what you would have from the HELOC, but the HELOC is there in case of an emergency if you find you can’t pay off the credit card before the rate resets.

I still would not recommend this for financing a timeshare though.

Thanks, good recommendations, I had been mostly counting on the 0% Hilton Amex to just pay it off next year, but apparently you only get that when Hilton sells you the timeshare. :/

Then the additional monkeywrench of, the title companies for the resale company in Florida will not take credit cards. They want cash or checks only.

 

[Fido Chuckwagon]

Thanks, good recommendations, I had been mostly counting on the 0% Hilton Amex to just pay it off next year, but apparently you only get that when Hilton sells you the timeshare. :/

Then the additional monkeywrench of, the title companies for the resale company in Florida will not take credit cards. They want cash or checks only.

This is because they don't want to eat the credit card processing fees.

 

[Wolfgheist]

This is because they don't want to eat the credit card processing fees.

The CC processing fee is not much and I would be ok with covering that.

 

[bnoble]

I had been mostly counting on the 0% Hilton Amex to just pay it off next year

Do you have a specific week that is currently for sale in mind, or is this more speculative?

If it is more speculative, one strategy would be to just pile up the money over the next year and buy it then. I do not think that the resale timeshare market is going to be significantly more expensive over that time horizon

If you have a specific week then the choices are different. If it is one that you absolutely, positively cannot live without AND is something that is very rare on the market, then maybe it is worth looking for a low-interest way to borrow the money for a year. HELOC is one way. Another might be a personal loan with a lender you have an established relationship with. For example, American Express claims they'd be willing to loan me a surprisingly large sum at a surprisingly low rate as an unsecured, personal loan.

 

[Wolfgheist]

Do you have a specific week that is currently for sale in mind, or is this more speculative?

If it is more speculative, one strategy would be to just pile up the money over the next year and buy it then. I do not think that the resale timeshare market is going to be significantly more expensive over that time horizon

If you have a specific week then the choices are different. If it is one that you absolutely, positively cannot live without AND is something that is very rare on the market, then maybe it is worth looking for a low-interest way to borrow the money for a year. HELOC is one way. Another might be a personal loan with a lender you have an established relationship with. For example, American Express claims they'd be willing to loan me a surprisingly large sum at a surprisingly low rate as an unsecured, personal loan.

What I wanted was very specific, so I am already in the process of purchasing it. I am waiting on Hilton to say if they are going to buy it, or let me buy it.
I had originally planned on using Amex for 0% on a Hilton Amex, but I am being told that is only an option if I buy retail and not resale.
The next barrier is the title companies will not accept credit cards.
I had planned on doing other things with my free cash this year and pay it off next year before the 0% went away, but all of those particular plans went in the toilet and trying to figure out another way.

 

[Fido Chuckwagon]

I do not think that the resale timeshare market is going to be significantly more expensive over that time horizon

If anything, it’s likely to continue crashing as it has been for the last several years.

 

[Fido Chuckwagon]

What I wanted was very specific, so I am already in the process of purchasing it. I am waiting on Hilton to say if they are going to buy it, or let me buy it.
I had originally planned on using Amex for 0% on a Hilton Amex, but I am being told that is only an option if I buy retail and not resale.
The next barrier is the title companies will not accept credit cards.
I had planned on doing other things with my free cash this year and pay it off next year before the 0% went away, but all of those particular plans went in the toilet and trying to figure out another way.

This is from a quick google search of “zero interest balance transfer cards.”

https://www.nerdwallet.com/m/credit-cards/pay-0-intro-interest?bucket_id=Catch+All&gad_source=1&gbraid=0AAAAADhM4h8MBp91_kialdx9qXIcrz-C8&gclid=CjwKCAiAt4C-BhBcEiwA8Kp0CV7tqqMvDvB7HcsEsD8xgptWqwXBESzWGAZFaOlvcG4YKy4mwkiHDRoCGlkQAvD_BwE&gclsrc=aw.ds&mktg_body=1678&mktg_hline=11649&mktg_img=3599&mktg_place=kwd-1049539220&model_execution_id=2AA0396D-4FED-43E5-9754-23C66B7C25C9&nw_campaign_id=150238292830084300&utm_campaign=cc_mktg_paid_071520_balancetransfer_beta&utm_content=ta&utm_medium=cpc&utm_source=goog&utm_term=0+balance+transfer+and+purchases

Looks like the best one right now is a Wells Fargo 21 month 0 interest BT card with a 5 percent fee (works out to something like 3 percentageish APR.

Edit: Actually the Citi one is better, only 18 months, but only a 3 percent fee, so actual APR comes in closer to 2 percent.

 

[Wolfgheist]

Yeah, I had looked at a few, with Amex looking pretty good, but the title company not accepting credit cards kind of nixed that.

 

[bnoble]

I had planned on doing other things with my free cash this year and pay it off next year before the 0% went away, but all of those particular plans went in the toilet and trying to figure out another way.

You aren't going to be able to float it at 0% on a credit card. No one is going to change how they do this for you, at least because accepting the credit card comes with risk of a chargeback, and this is a large amount. But mostly because no one is going to change business practices for one $20K sale.

So the only question is what's the cheapest way to finance, and are your other uses for the money more important given that rate?

 

[rickandcindy23]

If my kids came to me and asked for a loan to buy something they could convince me is a good deal, I would loan it to them.

You can ask your bank or credit union for a short-term loan and pay it off quickly. I said that before. If you have a car paid off that is worth that much money, you can re-finance the car. A home equity loan would be another option.

If you have none of the above, maybe you should wait a bit. Resales are abundant. It will come available when you are in a better place.

 

[Markport]

Pray tell, what resale timeshare week is worth $19k after the (unspecified) amount of your purchase deposit?

Hah! Exactly what I was thinking.

 

[Fido Chuckwagon]

Yeah, I had looked at a few, with Amex looking pretty good, but the title company not accepting credit cards kind of nixed that.

No, I’m talking about a balance transfer, not paying by credit card. A “balance transfer”” is really just a loan from the credit card company. Nearly all of them will let you either balance transfer to your checking account, or use balance transfer checks that you can write to yourself.

The steps to do this would be to:

1. Find a credit card with a good zero interest balance transfer offer (see list I included);
2. Sign up for the credit card.
3. Ask to do a balance transfer to your checking account or use included balance transfer checks to write yourself a check for the amount you need to finance the timeshare;
4. Use that money to pay for the timeshare.

 

[Wolfgheist]

No, I’m talking about a balance transfer, not paying by credit card. A “balance transfer”” is really just a loan from the credit card company. Nearly all of them will let you either balance transfer to your checking account, or use balance transfer checks that you can write to yourself.

The steps to do this would be to:

1. Find a credit card with a good zero interest balance transfer offer (see list I included);
2. Sign up for the credit card.
3. Ask to do a balance transfer to your checking account or use included balance transfer checks to write yourself a check for the amount you need to finance the timeshare;
4. Use that money to pay for the timeshare.

Ahh, had not thought about that, they usually charge a fee for cash out, but probably still less than any other method.

 

[dioxide45]

Ahh, had not thought about that, they usually charge a fee for cash out, but probably still less than any other method.

Even though there may be 0% on balance transfers, there might be a balance transfer fee or fee to use a balance transfer check. Usually around 3%.

 

[Fido Chuckwagon]

Ahh, had not thought about that, they usually charge a fee for cash out, but probably still less than any other method.

The fees range from 3 percent to 5 percent (that's what I was quoting), but yeah, amortized over the length of the zero interest period, it ends up being a pretty decent APR compared to any other kind of loan you can get right now.

 

[Fido Chuckwagon]

Even though there may be 0% on balance transfers, there might be a balance transfer fee or fee to use a balance transfer check. Usually around 3%.

Correct, so (and the math on this is not exact because of the nature of compounding interest), a credit card with an 18 month zero interest balance transfer offer with a 3 percent upfront fee works out to an annual APR of around 2 percent.

 

[jksung5295]

Ahh, had not thought about that, they usually charge a fee for cash out, but probably still less than any other method.

from past experiences. Citi Cards usually have the best options for Cash Advances. They have Flex Loan which you can specify how much and for how long and your interest rate will change accordingly (based on available credit). Or you can do cash advances at 5% fee which isn't terrible think of it as CC processing fee (around 3%) for 12-15 months generally.

They have no problem depositing your funds directly into your bank account and it doesn't even have to be paying off another balance elsewhere. Also the flex loan mentioned above does not come with prepayment penalty and no origination fee if you want to pay it off in month or two it might be cheaper than 5% fee.

Just throwing out options, not financial advice. I'm putting DVC purchases on CC for $2000 sign up bonus on Capital One Spark Cash card at 3% CC processing fee from the escrow agent. you just have to be creative

 

[SirhcATW]

I had been planning on using Hilton Amex with 0% for 12 months, but the agent is telling me that none of the title companies she has contacted will accept credit cards for the balance. They say credit cards are not secure for this type of transaction.

I sometimes have cash flow issues and have used Light stream for the loan. Your financial situation is yours. If you want a loan, don't listen to the others. Home equity can be an option as well. FYI, my first reale was DVC and was 40k, so sometimes you need to finance. We paid it off 13 months or so later but prices went WAY up in the time between when we bought and when we had the cash.

 

[PigsDad]

My last thought on the subject: I don't think anyone is questioning the "quality" of the timeshare. The real question is whether this is a good financial decision for the OP. I don't think so. YMMV

Spending $19K (even if financed) to save probably $3-5K (compared to renting equivalent accommodations) per year is not a terrible financial decision, IMO. The OP said they were going to vacation there over the holidays every year; sounds like this will pay for itself in a reasonable amount of time.

Kurt

 

[ncaahockeyfan]

Even though there may be 0% on balance transfers, there might be a balance transfer fee or fee to use a balance transfer check. Usually around 3%.

Only mom and dad might make a legit "no interest" loan. the origination fees built into the transaction are essentially prepaid interest to the lender...

 

[Fido Chuckwagon]

Only mom and dad might make a legit "no interest" loan. the origination fees built into the transaction are essentially prepaid interest to the lender...

Correct, but they result in an APR that is far lower than basically anything else you’re going to get. OP needs a short term loan. A 0 interest credit card balance transfer is probably OP’s best bet so long as OP pays it off before the teaser rate expires.

 

[heitmullerj02]

Everything is more expensive over Xmas holidays so it’s possible the air fare is quite high. I have always paid cash but so many banks offer pay over time on large items (bath remodel). I had to wire $$ for closing last time which the bank scrutinized to make sure I was not getting scammed.

 

[jbs]

I had been planning on using Hilton Amex with 0% for 12 months, but the agent is telling me that none of the title companies she has contacted will accept credit cards for the balance. They say credit cards are not secure for this type of transaction.

Banks charge their customers (the seller in this case) intercharge fees of 2% to 4% to use credit cards. AMEX charges among the highest fees. My guess is the fees are the reason they won't accept a credit card. There is nothing insecure about using the card, it just costs them money to do so.