It is being reported by the ‘The Orlando Sentinel’ that Disney World has created a new system which handles the foreclosures of its Disney Vacation Club contracts.
One report states that although the number of foreclosed timeshare units near Disney World in the Orlando area has fallen from the levels of 2011 and 2012, they are still excruciatingly high with a figure of 900 a year.
It is believed that many of the units the Disney Vacation Club has foreclosed are concentrated in three resorts near Disney World: The Saratoga Springs Resort & Spa, the Animal Kingdom Villas and Bay Lake Tower at the Contemporary Resort.
No judicial foreclosures allow trustees of the lienholders (Disney) to act as auctioneers. This allows the auctions to take place at a law firm that works with Disney instead of online through Orange County’s clerk of court.
Hundreds of Disney Vacation Club deeds go into foreclosure every year. While Disney typically wins the deeds back, others have won them at times as well. It would seem that this new process would increase the chances of Disney winning the deeds back.
The Florida Legislature in 2010 passed a law allowing no judicial foreclosures for time shares. Florida joined about 30 other states that allow the process, according to time-share trade group American Resort Development Association.
The Walt Disney Company did not disclose the default rate on timeshare loans originated by the Disney Vacation Club. But the company said it is “significantly less” than the industry-wide 6.3 percent default rate on timeshare loans calculated by the American Resort Development Association.
Chris Skeldon, vice president of sales at Fidelity Real Estate, which resells timeshares, told the Orlando Sentinel he is “shocked and surprised. I think virtually anyone who’s in foreclosure with a Disney property, the vast majority of them have options they may not know about.” Disney often buys back the deed to a timeshare unit in foreclosure, often for a nominal bid. But in some cases, multiple bidders emerge to acquire timeshares in foreclosure. Indianapolis residents Brad Shaffer and Keith Dickerson bought about 20 Disney timeshare units in foreclosure last year. Shaffer told the Orlando Sentinel that “it looks like a lot more people have been bidding — not winning, but bidding.”
Disney has said that third-party bidders continue to participate in the process and that some of them have won deeds.
For more information regarding this article or assistance in any other timeshare related issues please contact the TCA on 01908 881058 or email: info@TimeshareConsumerAssociation.org.uk