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Old 05-04-2020, 03:25 PM   #1
cmrdgrs
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Default Broker Contracts - I'd like to see....

If you rent your points privately, or only rent your points from a private owner, and feel this is the best way to go about a DVC rental, I don't disagree with you, but this thread isn't for you, I'm really just trying to focus on brokers.

As many of you know, I am an owner that rents privately, but I have considered renting my points with a broker.

Currently the trend brokers are going in is if the resorts close, owners contractually have to give back the 70%-75% of the money paid by the broker to the owner back to the broker. The broker takes back the payment from the owner, keeps their commission and they issue a travel voucher to the renter. For me this is deal breaker. If I'm going to tie up my points, and in the end have to return all the money paid, I want it all to go back to the renter. Period. Privately this is what I have done. I've been fully refunding any rental I had that was cancelled.

But, other owners think it's not fair of owners who are supporting a full refund to their renter expect that all owners do this. Some owners have stated that they spent the money they were paid from the broker, and they can't return the money, at least not right away. And then there is the issue of lost points from the owners perspective. They tied the points up and feel they should be paid something for providing the points to the broker.

So, under what contractual conditions would you be willing to rent with a broker -- either as an owner or a renter?

What is fair?

Idea #1 - I think the broker should have some "skin in the game" i.e. they have to give up their commission in the event of a closure.

Idea #2 - share the risk? broker returns their commission, owner only gets to keep MFs for the points rented if they are expiring or expired, and renter gets back the balance?

I honestly don't know what people would think is fair when working with a broker, that's why I'm posing the question to both owners and renters.

What would you like to see contractually when dealing with a broker?
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Old 05-05-2020, 12:43 PM   #2
zafiro
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Quote:
Originally Posted by cmrdgrs View Post
If you rent your points privately, or only rent your points from a private owner, and feel this is the best way to go about a DVC rental, I don't disagree with you, but this thread isn't for you, I'm really just trying to focus on brokers.

As many of you know, I am an owner that rents privately, but I have considered renting my points with a broker.

Currently the trend brokers are going in is if the resorts close, owners contractually have to give back the 70%-75% of the money paid by the broker to the owner back to the broker. The broker takes back the payment from the owner, keeps their commission and they issue a travel voucher to the renter. For me this is deal breaker. If I'm going to tie up my points, and in the end have to return all the money paid, I want it all to go back to the renter. Period. Privately this is what I have done. I've been fully refunding any rental I had that was cancelled.

But, other owners think it's not fair of owners who are supporting a full refund to their renter expect that all owners do this. Some owners have stated that they spent the money they were paid from the broker, and they can't return the money, at least not right away. And then there is the issue of lost points from the owners perspective. They tied the points up and feel they should be paid something for providing the points to the broker.

So, under what contractual conditions would you be willing to rent with a broker -- either as an owner or a renter?

What is fair?

Idea #1 - I think the broker should have some "skin in the game" i.e. they have to give up their commission in the event of a closure.

Idea #2 - share the risk? broker returns their commission, owner only gets to keep MFs for the points rented if they are expiring or expired, and renter gets back the balance?

I honestly don't know what people would think is fair when working with a broker, that's why I'm posing the question to both owners and renters.

What would you like to see contractually when dealing with a broker?
Not sure I'd ever go the broker route, but if I did:

Extracting from your IDEA #2 and knowing that the broker and the owner each have in hand about 50% of the total transaction (renter full payment), broker should agree to connect and mediate with the renter and owner in trying to:

A. In any closure case, there should be an exact point rebooking agreement option within the owner's booking windows, and point expiration issues. All financial transactions stay intact and broker pays owner the remainder at check in as originally agreed.

B. NO mention of VOUCHERS or promises for a hamburger today for payment next Tuesday.

C. If the renter has agreed to no refunds with the broker and the renter cancels or does not show, the broker will be obligated to pay the owner an automatic payment on the original check-in date or upon renter cancellation, whichever comes first, the remainder of the contracted amount.

D. If renter wants to rebook at another date requiring more points, banking or borrowing of points, the broker will pay the owner a 1.5 x the additional per point fee (eg: 1.5 X $15.5 per point) on all newly required points to complete the booking.

E. In cases of renter wanting to reschedule a booking that requires less points than the original agreement, the broker agrees to pay the owner at the originally contracted price and pays the remaining balance immediately at check-in since the original points were taken out of play to make the original reservation dates and may have less shelf life than when booked.


This seems like a good start for point brokers to have some skin in the game for their 30% take and keep regardless of situation.

Last edited by zafiro; 05-05-2020 at 12:51 PM.
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Old 05-05-2020, 01:28 PM   #3
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Don't know the exact legal wording on the broker's documents, but should the deal fall through, commissions are NOT earned.
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Old 05-05-2020, 01:36 PM   #4
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Don't know the exact legal wording on the broker's documents, but should the deal fall through, commissions are NOT earned.
But that hasnít been the case in the current situation.

There were some cases very early on when the renter got a full refund if the owner agreed. I cancelled at the request of my renter on the day they were due to check in, the day before the parks closed. My renter got a full refund.

Then the broker in question started holding onto their part of the payment, I assume to try and refund in part to renters where the owner refused to refund.

Now we have this voucher business.

So the brokers are holding onto their commission and the remaining money the renters paid.
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Old 05-05-2020, 01:39 PM   #5
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But that hasnít been the case in the current situation.

There were some cases very early on when the renter got a full refund if the owner agreed. I cancelled at the request of my renter on the day they were due to check in, the day before the parks closed. My renter got a full refund.

Then the broker in question started holding onto their part of the payment, I assume to try and refund in part to renters where the owner refused to refund.

Now we have this voucher business.

So the brokers are holding onto their commission and the remaining money the renters paid.

Brokers don't get to make new rules, or change the agreements unilaterally.
Commissions are usually earned, when the deal is finished.
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Old 05-05-2020, 01:39 PM   #6
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Originally Posted by zafiro View Post
Not sure I'd ever go the broker route, but if I did:

Extracting from your IDEA #2 and knowing that the broker and the owner each have in hand about 50% of the total transaction (renter full payment), broker should agree to connect and mediate with the renter and owner in trying to:

A. In any closure case, there should be an exact point rebooking agreement option within the owner's booking windows, and point expiration issues. All financial transactions stay intact and broker pays owner the remainder at check in as originally agreed.

B. NO mention of VOUCHERS or promises for a hamburger today for payment next Tuesday.

C. If the renter has agreed to no refunds with the broker and the renter cancels or does not show, the broker will be obligated to pay the owner an automatic payment on the original check-in date or upon renter cancellation, whichever comes first, the remainder of the contracted amount.

D. If renter wants to rebook at another date requiring more points, banking or borrowing of points, the broker will pay the owner a 1.5 x the additional per point fee (eg: 1.5 X $15.5 per point) on all newly required points to complete the booking.

E. In cases of renter wanting to reschedule a booking that requires less points than the original agreement, the broker agrees to pay the owner at the originally contracted price and pays the remaining balance immediately at check-in since the original points were taken out of play to make the original reservation dates and may have less shelf life than when booked.


This seems like a good start for point brokers to have some skin in the game for their 30% take and keep regardless of situation.

I would not agree to D. I want the right to say no to using extra points if it would mean borrowing more - I may already have or be planning to use those points. I agreed how many points I would be prepared to rent out, and unless the rental uses less points than that then I will not automatically agree to rent out more.
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Old 05-05-2020, 01:48 PM   #7
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I would not agree to D. I want the right to say no to using extra points if it would mean borrowing more - I may already have or be planning to use those points. I agreed how many points I would be prepared to rent out, and unless the rental uses less points than that then I will not automatically agree to rent out more.
Say you had to borrow a few points to complete a rebooked transaction, that would be the broker paying you 1.5 x $15.5 = $23.25 per point for those additional points. That's fair.
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Old 05-05-2020, 02:07 PM   #8
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Say you had to borrow a few points to complete a rebooked transaction, that would be the broker paying you 1.5 x $15.5 = $23.25 per point for those additional points. That's fair.
Yes, but that could affect my own plans. Sure, if I had points I could use, it’s fair.

Let’s take next year. I’ll have a full year of banked points to rent out. We’re pushing our trip back to the following year and will be using three years worth of points to book it.

So the renter changes their mind or wants to rebook because the parks are closed again. I will refund. I’ll rebook. Bit I may not have an extra 18 points to get them exactly what they want.

I will not cancel or modify my reservation, or even change my plans, n order to do that, even if I am going to be paid more. My family use our points first. Any not needed I will try to rent out. But I won’t agree to have to let the renter have more if it negatively impacts us. I would have a contract that says I agree to rent out 160 points.

They will have to lessen their trip by a day or the the broker can return my points and get someone else to book it for them.
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Old 05-05-2020, 02:08 PM   #9
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Brokers don't get to make new rules, or change the agreements unilaterally.
Commissions are usually earned, when the deal is finished.
Usually yes. I am simply telling you It is not what has been happening recently with the brokers. Iím not arguing thatís right, it isnít. But itís what is happening.
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Old 05-05-2020, 02:58 PM   #10
cmrdgrs
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I think what I would like to see is more money paid for current UY points and points rented in the first 8 months of an owners UY, and less money paid for banked points or for points used for a reservation in the last 4 months of an owners UY (banked or current UY)

This puts more work on the brokers, however, I have never felt the idea of a point-is-a-point-is-a-point was a fair way to value DVC points. They have functioned this way because it was easier to structure things in this manner.
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