Resale purchase-so confused-makes no sense

I am in the process of purchasing in St. Kitts resale. We received the closing documents this past Friday and signed and returned them with the cashier's check on Monday. NOTE: the current owner who bought from Marriott has already enrolled this week in the points program. Yesterday I called MVCI and spoke to a vacation club advisor. I explained the time line of events to him and asked him if the week would be eligible to be enrolled in the points program along with my two direct purchase weeks when Marriott receives the notification of the change of ownership. He did not know and put me on hold to check with a supervisor. He came back on the line and told me that it would be eligible for the points program when Marriott receives and processes the change of ownership. After reading other comments on TUG I was getting conflicting information. I just got off the phone with the Consumer Advocacy group. The lady there told me I could NOT enroll the week. She said it had to be closed by June 20th which it was not.
Now, I thought that if you joined the points program with a Marriott purchased week that you would be able to offer your resale purchaser the option to join the points program. In effect that is what has occurred here. The current owner who bought the week from Marriott has already enrolled the week in the points program so why does that capability not pass to me? I understand that the points obtained under the program would not transfer to a new owner but why does the right to enroll in the program not transfer to a new resale owner and why am I getting incorrect information from two different sources?

Just checked with the Consumer Advocacy group again and the right to enter the Vacation Club program does not pass to a resale purchaser upon the sale of your unit. So even though you bought from Marriott and you enroll your weeks in the club program if you sell your unit not only do any points you have not transfer to your new owner but the RIGHT to even enroll the weeks does not transfer either.

KathyPet said:

I just got off the phone with the Consumer Advocacy group. The lady there told me I could NOT enroll the week. She said it had to be closed by June 20th which it was not.
Now, I thought that if you joined the points program with a Marriott purchased week that you would be able to offer your resale purchaser the option to join the points program.

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I think the Consumer Advocacy lady misunderstood the situation Here's what I've got from the "Exchange Procedures" document:

Effect of Transfer of Member’s Interest. Unless otherwise agreed to in writing by the parties to a sale, assignment, or transfer, if a Member (“Selling Member”) sells, assigns, or transfers the Selling Member’s Interest to another party (“New Member”), the Selling Member will lose any and all rights to utilize the Exchange Points associated with such Interest to reserve the use of a Use Period or to use any previously-reserved Use Period. Each New Member will be required to remit to the Association an initiation fee; provided, however, an initiation fee shall not be required to be paid by an existing Member. (The current initiation fee is $200 per Interest with a $2,000 minimum initiation fee; however, Exchange Company reserves the right to adjust the amount of the initiation fee from time to time and to waive the initiation fee on a case-by-case basis in Exchange Company’s sole and absolute discretion.) Exchange Company will, within ten (10) business days of receipt from a New Member of the initiation fee, if required, and a certified copy of the recorded deed transferring an Interest to the New Member, change Exchange Company’s official records to reflect such transfer of an Interest from a Selling Member to a New Member. Further, with respect to Trust Members, until payment of any required initiation fee is received (or waived by Exchange Company), the New Member may not be entitled to Base Plus Exchange Benefits or Special Benefits in Exchange Company’s sole and absolute discretion; however, payment of the initiation fee (or waiver by Exchange Company) will allow access to the Base Plus Exchange Benefits.



Maybe you should read this the Consumer Advocacy Group. As long as the current owner went through the enrollment process before the ownership was transferred you should be able to pay the initiation fee and enroll this property into your account...

Y-ASK

Is it possible that the relevant verbiage pertains to points *owners* as opposed to *enrolled* owners of weeks?

The only positive thing I can say here is that, as I've exploited in the past with the Marriott hotel system, all this confusion brings the opportunity to exploit mistakes. This is the price Marriott pays for their lackluster training and documentation procedures. Good luck

If a current Marriott owner enrolls their weeks in the points program and sells that week two years from now their new owner cannot enroll those weeks in the points program because that original enrollment does not transfer. Thus your resale price will be affected because all new Marriott properties will only offer the points program and since your new owner cannot use that program they will be restricted from trading into any of the brand new resorts that will be opened in the future thus they can only trade into current existing Marriott properties.

Y-ASK said:

provided, however, an initiation fee shall not be required to be paid by an existing Member.

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Does this mean that those of you who convert (i.e. become "existing Members") can buy points or points-converted weeks on the resale market and add them to your existing accounts without an additional fee? If yes, that's a good perk for existing members and should help prop up prices for sellers. Am I reading this correctly?

IMO, yes, you are, and it makes sense, since an existing owner of points is already 'initiated' LOL...

KathyPet said:

Now, I thought that if you joined the points program with a Marriott purchased week that you would be able to offer your resale purchaser the option to join the points program. In effect that is what has occurred here. The current owner who bought the week from Marriott has already enrolled the week in the points program so why does that capability not pass to me? I understand that the points obtained under the program would not transfer to a new owner but why does the right to enroll in the program not transfer to a new resale owner and why am I getting incorrect information from two different sources?

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I understand that you will be able to enroll it again: the owner paid to enroll, now that week passes to you and you have to pay to enroll again (the resale value to enroll, of course).

The Jun 20th I think is the date where not enrolled weeks can be enrolled if they go on sale on the external market (resale). After June 20th, only the weeks alreadly enrolled can be enrolled again if they go on the resale market.

The Jun 20th I think is the date where not enrolled weeks can be enrolled if they go on sale on the external market (resale). After June 20th, only the weeks alreadly enrolled can be enrolled again if they go on the resale market.[/QUOTE]

Then what will happen maybe 25 or 50 yrs from now? eventually all of the 'weeks' owners will no longer be living, what happens to their weeks if conversion to points is not allowed to their heirs or to buyers

why wouldn't marriott allow these weeks to become part of their system?

Marriott hould have spent 3 months training people on this. This was a half assed launched of a poorly designed program.

why wouldn't marriott allow these weeks to become part of their system?

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They will, through ROFR in a depressed non-enrolled resale marketplace.

The confusion points to the simple reality that Marriott exploited the one area they have complete control over, and which isn't overtly 'controlled' in the governing documents condominium, that being the reservation system. Some MBA's will get a bonus out of this, take it, and be long gone by the time this implodes. Kids...

If you read further down in Section D on page 13 effect of transfer of Member's Interest you will read the following;
"with respect to exchange members (which all of us are) until payment of the enrollment fee, the New Member (me) will not be entitled to participate in the Program. If the purchase of a interest IS NOT MADE FROM A APPROVED BROKER
then the owner of such interest may not be entitled to Special Benefits in the Exchange Company's sole and absolute discretion even if the initiation fee is paid"

So since we purchased the resale week through Red Week and not from a Approved Broker which of course was impossible since the resort is not sold out we cannot enroll this week in the points program. So if any of us sell our units on the resale market even though we may have enrolled them in the points program for our own use that right does not pass to a new buyer if we sell privately and thus that new owner will be restricted to trading for current Marriott resorts and will never be able to go to any of the new points based resorts.

You never know if that will change at some point too.

That's the problem with the whole deal - no certainty with respect to most aspects.

KathyPet said:

If you read further down in Section D on page 13 effect of transfer of Member's Interest you will read the following;
"with respect to exchange members (which all of us are) until payment of the enrollment fee, the New Member (me) will not be entitled to participate in the Program. If the purchase of a interest IS NOT MADE FROM A APPROVED BROKER
then the owner of such interest may not be entitled to Special Benefits in the Exchange Company's sole and absolute discretion even if the initiation fee is paid"

So since we purchased the resale week through Red Week and not from a Approved Broker which of course was impossible since the resort is not sold out we cannot enroll this week in the points program. So if any of us sell our units on the resale market even though we may have enrolled them in the points program for our own use that right does not pass to a new buyer if we sell privately and thus that new owner will be restricted to trading for current Marriott resorts and will never be able to go to any of the new points based resorts.

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I think the key word here is "Special Benefits" not the points that have already been enrolled. Those "Special Benefits" include things like "PlusPoints". The way I'm am reading this, if the current owner does the enrollment now and they get the 800 PlusPoints and then they sell to you without ever using those points or any of the resort points, when you close and the transfer takes place, you (the new owner) do not get the 800 PlusPoints but you do get any of the unused regular year-to-year points. At least that's the way I see it...

Y-ASK

Here's some info:

Interest means the ownership interest(s) in an Affiliate Program or in a Component or Accommodations affiliated with the Affiliate Program that is created pursuant to the governing documents of such Affiliate Program, Component, or Accommodations, as the case may be.

Special Benefits mean special products, services, benefits, and vacation/recreational experiences offered by Exchange Company, including, without limitation, the ability to reserve hotel accommodations, cruises, other travel services, and to receive Single Use Points. The ability to utilize a Special Benefit may not be available to all Members including, specifically, Members who are entitled only to Base Exchange Benefits. If Special Benefits are available and a Member is eligible to purchase or utilize any Special Benefits, separate terms and conditions shall apply to the purchase and use of such Special Benefits.

I would think the use of regular year-to-year points falls under the "Base Exchange Benefits" which can't be taken away, at this time, from an enrolled member which a resale purchaser has the right to if the week has already been enrolled by the previous owner...

So how can I find out what a "Special Benefit" is defined as????

OK so I placed another call to the Advocacy group and the person I spoke to was on another line. I left my # and asked her to refer to page 13 Section D of the Reservations document and to the definiton of Special Benefits. I asked her to refer me to the section that states that a Exchange member is not entitled to "base benefits" (trading the week for vacation club points) unless they purchased from a approved broker. Let's see what she says.

If you received your closing documents on June 18 (this past Friday) and the plan wasn't announced until June 20, how could the previous owner have already enrolled in points. Did the owner join after sending you the closing documents?

I hope it works out for you and please let us all know exactly what they say. I'm sure there are others who would like to purchase resale deeded weeks that are already part of the points system in the near future and would want to keep them "enrolled".

Y-ASK

Yes the current owner enrolled the week prior to sending the closing docs back to the closing company

jerseygirl said:

Does this mean that those of you who convert (i.e. become "existing Members") can buy points or points-converted weeks on the resale market and add them to your existing accounts without an additional fee? If yes, that's a good perk for existing members and should help prop up prices for sellers. Am I reading this correctly?

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That's exactly what it means...

See my doomsday scenario here - sound familiar?

I was told it can't happen...

Dan --

From your doomsday post:

The way the rules stand today you can sell an enrolled unit and the new owner can join for a $2K-5K fee (I believe it's $800 per 1000 points, 2K minimum). Despite the cost, this is an obvious backdoor into the system and beats buying 5000 points for $45K+.

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I'm asking if the clause I quoted above means that existing members (aren't there potentially 400K - 500K of you??) can buy a converted unit in the resale market and NOT pay the fee???

I'm looking at this clause: "provided, however, an initiation fee shall not be required to be paid by an existing Member"

Maybe this is wishful thinking for all of you, but I'm hoping it means:

-- Perry converts his existing week(s)
-- You convert your existing week(s)
-- Perry decides this isn't the greatest thing since sliced bread and sells his converted week(s) to you
-- Because you're an "existing member," you get points for your week(s) and Perry's week(s) without paying a second initiation fee

Again, wishful thinking .... or am I completely off base?

jerseygirl said:

Dan --

From your doomsday post:



I'm asking if the clause I quoted above means that existing members (aren't there potentially 400K - 500K of you??) can buy a converted unit in the resale market and NOT pay the fee???

I'm looking at this clause: "provided, however, an initiation fee shall not be required to be paid by an existing Member"

Maybe this is wishful thinking for all of you, but I'm hoping it means:

-- Perry converts his existing week(s)
-- You convert your existing week(s)
-- Perry decides this isn't the greatest thing since sliced bread and sells his converted week(s) to you
-- Because you're an "existing member," you get points for your week(s) and Perry's week(s) without paying a second initiation fee

Again, wishful thinking .... or am I completely off base?

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Ah, now I see what you are saying. If true, this is even a bigger loophole than I thought because even with that pretty hefty fee it'd make much more sense buying a converted resale unit over buying retail points.

I don't know the answer, but definitely worth finding out. I give Marriott more credit than this, so surely we must misunderstand what it reads.

DanCali said:

Ah, now I see what you are saying. If true, this is even a bigger loophole than I thought because even with that pretty hefty fee it'd make much more sense buying a converted resale unit over buying retail points.

I don't know the answer, but definitely worth finding out. I give Marriott more credit than this, so surely we must misunderstand what it reads.

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It would be great if Marriott would spell out the terms for the different ownership types, i.e.:

Member:

Buys a non-converted week in the resale market
Buys a converted week in the resale market
Buys "pure points" in the resale market

Non-Member:

Buys a non-converted week in the resale market
Buys a converted week in the resale market
Buys "pure points" in the resale market

Okay -- I have a suspicious mind, but perhaps Marriott is planning on using ROFR to pick up good weeks in sold out resorts to seed the new program (especially if as many "legacy" owners don't jump as they had hoped, or jump but continue trading in weeks). Would Marriott get a "free pass" on converting those weeks to points and, if so, couldn't you all cry foul? So, perhaps "existing owners" can add points from the resale market at no cost because Marriott is planning on doing it ... in a big way.

Don't forget that Marriott has ROFR (oh, see someone else went 'there' ) at the majority of its resorts, meaning they can easily buy up 'converted' weeks during the sales process. The change in the reservation system doesn't supercede the verbiage in the governing documents condominium and, at my resort, that means Marriott gets first shot at any intervals I decide, in any form and for whatever reason and at any price to sell, 'converted' or not. Is this incorrect? If not, keep an eye on that 'loophole'