Owners who are looking into selling a Marriott timeshare or buying a Marriott resale may be wondering about Marriott’s Right of First Refusal policy. The Right of First Refusal is a contractual clause that states that Marriott may purchase a property back from an owner trying to sell to a third party.
The Right of First Refusal, or ROFR, can bring a lot of questions, especially if Marriott chooses to exercise their right to purchase the property from the existing owner. So let’s take a look at some of the most common questions that may occur when Marriott exercises their Right of First Refusal.
Things To Know About Right Of First Refusal
Although there are a few exceptions, most Marriott Vacation Club contracts will have to go through Marriott’s Right of First Refusal process. Marriott will need to be notified by the title company, or the broker if the seller chooses to use one, of their intent to sell. The intent to sell will need to be done in writing. Marriott will then have 15 to 30 days to respond with a Right of First Refusal or the ROFR waiver. This can certainly add time on to how long it takes to transfer the property to a new owner, although Marriott does try to move through the process quickly and typically responds within about 10 days. If Marriott does not respond in the 30 days, by default – they waive their Right of First Refusal and the sale will be able to go through with no issue.
After Marriott chooses to waive their Right of First Refusal, buyers will pay unless negotiated by the buyer and seller will need to pay a $95 fee. This fee needs to be paid before the transfer of ownership is complete.
Certain locations of Marriott Vacation Club do not have a ROFR. For those looking to avoid the Right of First Refusal all together, there are some property options. Locations that do not have a ROFR include:
- Marriott’s Frenchman’s Cove
- Marriott’s Desert Springs Villas I (MDS Villas II does have the ROFR clause)
- Marriott’s Fairways Villas
- Marriott’s Harbour Club
- Marriott’s Harbour Point
- Marriott’s Heritage Club at Harbour Town
- Marriott’s Monarch at Sea Pines
- Marriott’s Royal Palms
- Marriott’s Sabal Palms
- Marriott’s Streamside (Birch, Cedar, Douglas)
- Marriott’s Sunset Pointe
If none of the above properties are of interest to buyers who are looking at pushing through the Right of First Refusal, using a qualified and experienced broker will give potential buyers the opportunity to move through the ROFR process swiftly.
Do I Get My Money (Deposit) Back?
Any money that buyers put down as a deposit will be returned to them if Marriott chooses to exercise their Right of First Refusal. If the potential buyer went through a broker, then that money will be held with the closing company during this process. If Marriott decides to exercise Right of First Refusal, the closing company will be notified and will then return the money back to the buyer.
Can I Try To Buy Again?
Buyers are always welcome to try to buy again if Marriott exercised their Right of First Refusal. The best solution to those looking to purchase Marriott would be to go through a broker for their next transaction. Utilizing a broker will help potential buyers find the resale property that will best fit their vacationing needs. A broker will also assist buyers as a consultant in regards to current market conditions, to help prevent Marriott from exercising ROFR on their next resale purchase.
Does That Mean My Price Was Too Low?
Usually if Marriott exercises their Right of First Refusal it does mean that the price was too low. This, however, is not always the case. There are sometimes instances where the developer will need to buy certain properties back from owners for inventory purposes, although this is not as common as the price simply being low.
It is important to note that Right of First Refusal is in place to protect Marriott owners. Marriott having the ability to buy properties back from owners when the resale price is too low, ensures that the unit will stay valuable. This will prevent owners from being forced to sell at prices that are too low later on.
How Much More Should I Offer On My Next Attempt To Buy?
How much to offer on a property is always situational. The cost of a property will be based off of the home resort, current market conditions, and the thresholds of Right of First Refusal. This is another instance where having a timeshare broker will allow for buyers to get what they want at the right price. Brokers have the knowledge and experience to understand the current market circumstances and ROFR thresholds.
Conclusion
Although the process of Right of First Refusal might seem complex, there are ways to get through it and onto a dream vacation quickly. Having the right broker behind a potential buyer will make all the paperwork and contracts go smoothly, and will lessen the chances that Marriott will exercise their Right of First Refusal. Once the Right of First Refusal is waived, soon to be owners will be step closer to paradise.
