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HFT 3273

Timeshare Industry Final
STUDY
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In the timeshare indsutry, financing is critical because...
Both developers and purchasers need financing.
Which of the following is NOT a component of the cash flow projection?
Approximation of annual resort maintenance fees
Acquisition financing
funds that pay for the land
Equity financing
"seed money"
Construction financing
FF&E
Development financing
prepares site for improvements
End loan financing
funds for consumer purchase
Timeshare financing does NOT allow for which of the following...
Developer resale initiatives.
Progressive lenders that offered coordinated sequencing of all of the loans necessary for timeshare development entered the industry in which decade?
. 1990s
What are the components of the initial loan submission?
information about the developer, the employees, the project, the expected loan types, amounts and sequencing.
If a lender chooses to secure their own appraisal, they are required to reveal all of the details of the appraisal to the developer.
False
Appraisals for the purpose of supporting timeshare financing are no different than appraisals to support individual home purchases.
False
With regard to timeshare financing, the value of a property is...
Income - (expenses + the time value of money)
Feasibility
determines whether engaging in development of project is practical and profitable
Credibility
legal structure, historical performance, detailed resumes of key players
Hypothecation
collateral in the form of end loan financing
Securitization
bundling a variety of loans for sale to investors
A developer seeking equity financing is asking a lender to...
Put up most of the money to launch the project.
What is the typical term for acquisition loans?
4 years
Pre-sale financing provides funds for sales...
of units that have not yet been built
In end-loan financing, the down payment and term are typically...
10-20% and 5 to 10 years
Financing is an interesting and typically optional component of the timeshare industry.
False
In timeshare sales, the personal selling approach is referred to as a...
Consultative sales process
During the timeshare sales process, the "order of the day" is intended to...
remove prospect anxiety
During the sales presentation process, the "intent statement" is used to...
Let the guests know that the sales executive will ask them to buy something after the presentation
In the timeshare sales process, the sales executive is able to build the financial case for the product if...
The prospects usually spend approximately $4,000 to $5,000 on vacations annually.
Because of the nature of "relationship selling", the timeshare sale is generally made...
Within the first 15 minutes of the process.
Because of the complexities of the product, the timeshare sales person will spend approximately what percentage of the timeshare presentation on product knowledge?
10%
During the timeshare sales process, financing is discussed during which phase?
Trial close
Approximately what percentage of timeshare sales are to existing owners?
40%
The current industry average closing percentage is...
12.8%
In the timeshare industry, the sales process normally follows which sequence of decisions...
Why vacation, why timeshare, why this company, why this location, why today
Approximately how many people who are offered a timeshare tour will accept the offer?
1%
In the typical timeshare sales process, approximately how many purchasers will rescind?
2-3%
Because of the upfront tour requirement, timeshare marketers can expect that what percentage of prospects will "show up"?
80%
Timeshare marketing may be more appropriately referred to as...
Lead generation
Which component results in the greatest cost percentage for timeshare companies?
Marketing
The typical price of a timeshare mini vac will range from...
$200-400
In timeshare sales, the term VPG refers to...
The average contract amount for all guests seen
In timeshare sales the conversion rate refers to...
The percentage of prospects who end up purchasing
In the timeshare sales process, whose responsibility is it to get the buyers in front of the sales executives?
The marketing department's
Which term refers to the percentage of people who will purchase the mini vac they are offered?
Booking rate