Residual Values at the Royal Resorts

[islander222]

The Royal Resorts have changed the rules regarding residual values. Residual values are no longer transferred to the new owner if the resale is not done through their sales office. If the sale is private, the new owner gets a residual value of 0.

 

[DosMasCervesos]

Where did you hear or read this?

Does it apply to all of the Royal properties?

Based on the way I'm reading my contract, I have the right to sell/transfer the membership "having terms and provisions substantially similar to the terms and provisions of this Membership Agreement", where my membership agreement includes the Residual Rights. I don't see how they could legally deny that if I sell the membership to another party outside their sales office.

 

[islander222]

I purchased a Royal Caribbean in February. When I received my Membership Agreement to sign and return, there was no Addendum 1 included. The contract reads, "Club members of record on the date of termination of the Trust shall be paid their residual rights as specified in Addendum 1 referred to in Clause Seventeenth hereof."

Since there was no Addendum 1 with residual value, I asked why I didn't get one. I received an email stating ISCO would be sending an Addendum 1.

When I received the Addendum1, the residual value is 0. I sent two emails to the Royal Resorts asking why I didn't get a residual and what happened to it. I asked if they are changing the rules. I also told them that they need to let owners know if they are making changes.

After two requests I finally got the following answer.

"If you bought at the royal caribbean recently through our resale market the residuals are past on to the new buyer if there are residuals on that particular unit, some of our units don't receive residuals. In the case that you had bought in the internet or privately, contracts are issued with a cero value because we can't guarantee residuals on units that we did not sell."

 

[pjrose]

I never heard of this. Who did the last communication come from?

If the communication you got is what they are actually doing now, it is outrageous and sounds like a breach of contract.

This needs to be clarified with the person at the very top of the Royal Resorts - I believe this is the correct person:

Armando Millet Vales
Corporate Operations Manager
Ph: +52-998-881-0175
Fax: +52-998-848-82-30
amilletv@royalresorts.com

 

[islander222]

The email came from Nataniel Herrera, Sales Coordinator.

I thought something strange was going on when I received a Purchase Agreement from Premiere Resales, LTD, in place of Addendum 1. There was no mention of a residual value.

According to Royal Resorts membership benefits page, it asks, "At the end of the membership program do you receive an interest in the sale proceeds of the Resort property?" Their answer "Yes".

Also under Residual Rights it says,

"The Member (purchaser) receives a residual rights distribution upon the sale of the resort from the Membership Company. In order to guarantee the residual rights distribution, shares of the corresponding asset ownership company are deposited in a bank trust."

That's why I asked what happened to the residuals. I never did get an answer about that.

 

[islander222]

Thanks for the info, PJ. I still haven't signed or returned the Membership Agreements yet. I thought I would take them with me when we go to Cancun in July. Then I can talk to someone face to face.

I just wanted to let others know about the change.

 

[KarenLK]

islander, your response from ISCO is barely comprehensible, given poor grammar, spelling and punctuation:

"If you bought at the royal caribbean recently through our resale market the residuals are past on to the new buyer if there are residuals on that particular unit, some of our units don't receive residuals. In the case that you had bought in the internet or privately, contracts are issued with a cero value because we can't guarantee residuals on units that we did not sell."

How can they not guarantee residuals on units they did not sell, when they always did that previously????

Who is going to forward this on to Mr Millet?? I will if no one else steps up.

I am still steamed about the name change at VCI, and came close to paying him a visit in March, so I am willing.

 

[aliikai2]

I hope this is a sales department ploy,

and not a real change in the use and value or the Royal Ownerships.

I would hate to see what has been a stellar organization go down that path.

jmho,

Greg

I purchased a Royal Caribbean in February. When I received my Membership Agreement to sign and return, there was no Addendum 1 included. The contract reads, "Club members of record on the date of termination of the Trust shall be paid their residual rights as specified in Addendum 1 referred to in Clause Seventeenth hereof."

Since there was no Addendum 1 with residual value, I asked why I didn't get one. I received an email stating ISCO would be sending an Addendum 1.

When I received the Addendum1, the residual value is 0. I sent two emails to the Royal Resorts asking why I didn't get a residual and what happened to it. I asked if they are changing the rules. I also told them that they need to let owners know if they are making changes.

After two requests I finally got the following answer.

"If you bought at the royal caribbean recently through our resale market the residuals are past on to the new buyer if there are residuals on that particular unit, some of our units don't receive residuals. In the case that you had bought in the internet or privately, contracts are issued with a cero value because we can't guarantee residuals on units that we did not sell."

 

[pjrose]

Where'd you buy it? Are you sure it's legit?

Thanks for the info, PJ. I still haven't signed or returned the Membership Agreements yet. I thought I would take them with me when we go to Cancun in July. Then I can talk to someone face to face.

I just wanted to let others know about the change.

I did a bit of Googling. Premiere Resales, Ltd is the group that handles sales of Royal Resorts if you list your unit with the Royals for resale.

Where did you buy this unit - eBay, or ?? Is Nataniel Herrera, Sales Coordinator, part of ISCO, or part of Premiere Resales? If not part of ISCO, then did you check ISCO to ensure that this sale is legitimate - unit, week, fees up to date, and so forth? Was it advertised as having $XXX residuals? If so, the seller would seem obligated to provide that.

The face to face people in Cancun are sales people and it is in their interest to sell the units themselves, so you might not get anywhere. However, the person in charge, I think, is Diane Zanuzowski, who has been down there for ages but is originally from Minnesota. If anyone would know what's going on, she would.

Another possibility is to call ISCO and ask for the head of Title Transfer - I believe it's Edna Rolan. She may be able to clarify this issue.

Islander - if you haven't yet signed the agreements, what's the status of the sale? Do they have your money? When you go in July, is that the unit you're planning to stay in? If you haven't signed the paperwork yet, then are you the owner?

If it's for real, then I think it's a great idea for Karen to follow up with Armando Millet (Vales?)

Is there any buzz about this on the Royals owners site? I just hopped over there and posted a discussion, so let's see if anyone knows anything.

If there's a moderator reading, perhaps the original title could be amended with something to alert all Royals owners to read it, and a ! icon added?

 

[tonyg]

I hear the resale values falling even more.

 

[JEFF H]

Original Residual value should transfer with the membership agreement when sold.
You would need the original membership agreement Addendum 1 to see what the residual value you purchased was listed at.
did the seller advertise a residual value?
Some memberships were resold at a higher price than the original residual value so it could be less than the purchase price.
The Royals did play some games on weeks they took back over and resold.
They stripped the residual value from some and sold them with no residual value. They offered residual value upto the purchase price if you payed a extra fee. You may have purchased one of these weeks that has no residual value.
You should contact ISCO and verify all membership details befor purchasing to avoid disapointments.

 

[pjrose]

There does not appear to be a new policy

Islander - a poster on the royal resorts owners site just purchased privately and DID get the residual values. From discussion on that site and here, it appears that some units which were company owned had no residual value, and perhaps you bought one of them?

An important question is whether the unit was advertised as having a particular residual value.

See here for the discussion on the other site:

http://royalresortowners.ning.com/f...2135686:Comment:55473&xg_source=msg_com_forum

 

[jschmidt]

PJ

Great detective work!

This should be a “Heads-Up” for anyone who is planning to purchase a Royal Resort re-sale. :whoopie:

Thanks!

 

[pjrose]

PJ

Great detective work!

This should be a “Heads-Up” for anyone who is planning to purchase a Royal Resort re-sale. :whoopie:

Thanks!

And also anyone selling one - get info from ISCO (in writing) about whether your residual will transfer before advertising it!

 

[chalucky]

I just won a week on EBAY for a resale Royal ownership.

Did anyone ever get additional info about the transfer of residual value?
Thanks

 

[pjrose]

Which resort? The contracts regarding residuals vary by resort.

 

[craigchams]

We bought a villa at the Royal Sands on Ebay that was final in August of this year. Our contract says we have residual rights.

The fourth declaration titled "Residual Rights" states the following:

"Sands declares that upon expiration of the compliance document mentioned hereinabove, the Trust and of this Membership Agreement, the Club will be sold for the best price obtainable and, after first deducting taxes, commissions and other appropriate charges and expenses derived from such sale, any sales proceeds remaining will be distributed among the beneficiaries of Vacation Intervals, corresponding to one equal share for each Vacation Interval into which the Club is divided."

The date of my membership agreement is August 17, 2010. I don't know about other contracts, but mine appears to have residual rights

 

[chalucky]

The ownership is at the Royal Haciendas....thx

 

[pjrose]

The residual value at the Royal Haciendas is similar to that quoted for The Sands above. At The Royal Cancun (AKA VCI and Club Internacional de Cancun), The Royal Mayan, and The Royal Caribbean the potential payback (if the sale nets enough and after taxes, legal fees, and so forth) is at least the original purchase price of the specific unit/interval.

For The Royal Islander, The Royal Sands, and The Royal Haciendas the net sale proceeds (after taxes, legal fees, and so forth) are divvied up equally regardless of the original purchase price of the unit.

In terms of whether the residual value transfers, it should transfer as stated in the owner's agreement (contract) if you buy it from a third party (i.e. not a Royal Resorts resale). If the week had been an owner default and then was re-sold by the Royal Resorts, then they were/are stripping out the residual rights in order to sell it for less and make more money on the sale.

You will need to call ISCO to double-check the residual rights of the one you bought.

 

[chalucky]

Thanks...that was exactly what I was looking for

Ebay seller has 100% positive rating and has been very responsive...I will call ISCO as you suggested.

 

[kenie]

We bought a Royal Mayan resale this past summer, and it has residual rights.

I had called ISCO to confirm.