What Is Disney Right of First Refusal When Selling?

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If you’re considering selling your Disney Vacation Club (DVC) membership, understanding the concept of the Right of First Refusal (ROFR) is crucial. This policy is an important part of the DVC resale process, and it can significantly impact your selling experience. In this article, we’ll explain what ROFR is, how it works, and what you need to know to navigate the process effectively.

Understanding Disney's Right of First Refusal

The Right of First Refusal is a contractual agreement that allows Disney to review and potentially purchase your DVC contract before it is sold to an outside buyer. Essentially, when you decide to sell your DVC membership, Disney has the first option to buy it back at the price you have agreed upon with the buyer.

How the ROFR Process Works

Here’s a step-by-step guide on how the ROFR process works when selling your DVC membership:

Step 1: Listing Your Contract - To initiate the sale, you first need to list your DVC contract with a licensed DVC resale broker. For finding a trusted DVC resale broker, visit Best DVC Broker.
Step 2: Accepting an Offer - Once your contract is listed, you will receive offers from potential buyers. After reviewing these offers, you can accept one that meets your expectations.
Step 3: Submitting the Sale to Disney - After accepting an offer, your broker will submit the sale to Disney for review. This includes providing Disney with the details of the sale, including the purchase price.
Step 4: Disney's Review Period - Disney has 30 days to exercise its Right of First Refusal. During this time, they will decide whether to buy the contract themselves at the agreed price or allow the sale to proceed to the buyer.
Step 5: Notification - At the end of the 30-day period, Disney will notify your broker of their decision. If Disney chooses to exercise its ROFR, they will purchase the contract at the same price you agreed upon with the buyer. If they decline, your sale can proceed with the original buyer.

Why Does Disney Have ROFR?

Disney’s Right of First Refusal serves several purposes:

Quality Control: Disney wants to maintain the integrity of the DVC brand and ensure that the ownership remains in line with their standards.
Market Value: By having the option to repurchase contracts, Disney can help control the resale market and maintain property values.
Member Experience: Ensuring that new members are aware of the DVC lifestyle and benefits helps enhance the overall experience for everyone involved.

What Happens If Disney Exercises ROFR?

If Disney decides to exercise its Right of First Refusal, they will purchase the contract at the price you and the buyer agreed upon. As a seller, you will not be able to sell to the original buyer, but you will receive payment directly from Disney. This can sometimes be a smoother process than negotiating with multiple buyers.

What If Disney Does Not Exercise ROFR?

If Disney chooses not to exercise its Right of First Refusal, the sale will proceed as planned with your chosen buyer. You will then complete the necessary paperwork with your broker and transfer ownership to the new member. This is often a straightforward process, facilitated by your broker.

Tips for a Smooth ROFR Process

To help ensure a smooth experience when selling your DVC membership, consider the following tips:

Work with a Knowledgeable Broker: Choose a broker who understands the DVC market and the ROFR process. They can guide you through each step effectively.
Understand Your Contract: Familiarize yourself with your DVC membership details, including points, use year, and any restrictions. This information will be crucial when discussing with potential buyers.
Set a Competitive Price: Research comparable sales to determine a fair market price for your contract. A well-priced contract is more likely to attract buyers while also being appealing to Disney.

Financing Options for Buyers

If you’re selling your DVC membership, it’s also important to consider that potential buyers may require financing. For DVC financing options, check out Vacation Club Loans, which can help buyers secure the funds they need to purchase your contract.

Conclusion

Understanding Disney’s Right of First Refusal is essential when selling your DVC membership. By knowing how the process works and working with a reputable broker, you can navigate the sale with confidence. Whether Disney decides to exercise their ROFR or not, being informed will help you make the best decisions for your circumstances.

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What Is Disney Right of First Refusal When Selling?