In many discussion groups, people often seem very confused by how Use Years, banking, borrowing, booking windows, etc. work. I’ve developed an analogy that I think helps people understand these things better.

First, let’s explain what a Use Year is…when you purchase a DVC contract, your are given a home resort, a number of points per year, and a Use Year, which is given as a particular month – for example, January or September. The fact that it is often expressed as a month alone can confuse people. But what that essentially means is that you get an allotment of points to use for reservations within the year that starts on the first of that month, and ends the day before the 1st day of that month a year later. So, if you have a September Use Year and a 200 point contract, it means you have 200 points (to start with) that you can use between September 1st and August 31st the following year.

Some others tell people that you receive your points on the 1st of the month. This isn’t exactly true, and it confuses some into thinking they can’t make reservations until they’ve “received” their points. It is more correct to say that you receive all your points, for EVERY year up until the expiration of the contract, when you get your contract. You can’t use most of them because they are far out in the future, far out from your booking windows, but they are there. You could be currently in your 2014 Use Year, but booking for a resort stay during your 2015 Use Year, and borrowing 2016 Use Year points to do it.

People often get confused when members talk about “2014” points, “2015” points, and so on. What that generally refers to is the year’s points starting with your Use Year month. So if you have a September Use Year, then your 2014 points refer to the points you have that can be used in the period of September 1st, 2014 to August 31st, 2015. This is where the term “Use Year” really has meaning.

So, how can we simplify all this? Buckets.

The Basics

Think of each Use Year as a set of buckets. We’re only concerned with one bucket per Use Year to start with, so let’s just call it the Vacation bucket (DVC calls your normal points Vacation points – that is sort of important later.) In that bucket is your yearly allotment of points – envision them as ping pong balls. Each ball has the name of the resort on it – say, Saratoga Springs (SSR). Let’s say for the rest of our examples, we have a September Use Year, with 200 points at SSR.

So, now that you have your contract, you have all these buckets, with all these points in them. When you make a reservation in any given Use Year, you use the points from that bucket to make the reservation. If you are making a reservation in the 7-11 month “home resort” window, you can only make a reservation using points labeled with that resort – so if you only have SSR points (your home resort on that contract), you can only book at SSR in that time period.

Let’s say it is November 2014, and we’re making a reservation for July 2015. July 2015 actually falls within our 2014 Use Year (September 1 2014 to August 31 2015), so we use the points from our 2014 bucket to make the reservation. And since it is more than 7 months away, we can only make a reservation at SSR. But if we wanted to make a reservation in April 2015, they still come out of the 2014 bucket, but the “resort label” no longer matters – we can make a reservation at any DVC resort.

Now, if we wanted to make a reservation for September 2015 – within our 11 month window still, but falls within our 2015 Use Year, we have to use the points from our 2015 bucket. We CAN use those points – as I mentioned, many people seem confused because they believe they don’t actually get the points to use until September 1st, 2015…

Here is one gotcha – what if I want to make a reservation that spans my Use Year? That is actually a little complicated. In fact, the online system won’t let you make a reservation that does that. Let’s say I want to book a reservation that goes from August 28th to September 3rd, 2015. The period of August 28th-31st is in my 2014 Use Year, and September 1st-3rd is in my 2015 Use Year. I can’t simply make a reservation that can take points from two different Use Year buckets at the same time. But you CAN call Member Services and have them do it for you. But what they are actually doing is making two reservations – one for each side of the Use Year boundary – and using the points from the appropriate buckets for each. They then link the reservations together, which makes them act as a single reservation as far as your room is concerned. You just can’t do it yourself online. You could make two reservations yourself, and then call Member Services to have them link the two together for you, but you still need to call – otherwise, you could be forced to check out and back in – potentially into a different room.

What if you have points at more than one resort? Well, if you purchased directly from DVC, all your contracts will generally have the same Use Year. It is possible to get a different one, but that makes things very complicated – more on that in a second. In this more simple case, where all the different resorts and points fall under the same master contract and Use Year, you can put all the points in the same bucket – just keep in mind that the points are still labeled with their respective resorts, and can only be used for those resorts for reservations in the 7-11 month “home resort” window. So, if I have 100 points at SSR, and 100 points at Animal Kingdom Villas (AKV), and I want to make a reservation 10 months from now at SSR, I can’t make one that costs more than 100 points, as I can’t use the AKV points for an SSR reservation until I reach 7 months. One note – once I reach the 7 month window, I CAN call Member Services and have them swap the points used around! However, it generally requires that there still be availability at the resort, as they have to cancel your existing reservation and make a new one. This also prevents members from getting an unfair advantage by using “expensive” home resort points to secure a reservation early, but then replacing them with cheaper points they could not have used on that reservation and keeping the more expensive ones to book further out.

Now, what if you purchased different contracts on the resale market? Well, if they have the same Use Year, and the details on the titles and contracts are exactly the same, DVC will usually combine them into one master contract as if you purchased from DVC directly. Otherwise you have to treat them all separately…all separate sets of buckets, and you can’t combine points from different contracts to make a single reservation. You CAN transfer points between contracts, but you can only do one transfer – in or out – per Use Year per master contract, and that can also result in other complications as well…a little out of scope right now.

I hope that all makes sense at this point – because we’re going to add some more buckets.

Banking and Borrowing

Now, if you only had that one Vacation bucket, and you used 180 of the points, leaving 20 left in the bucket – but you couldn’t book anything for 20 points before the end of the Use Year, you’d lose those 20 points. That’s not very helpful. So DVC allows us the ability to save those points, or alternately borrow from ourselves, to be able to still use those points. This is called Banking and Borrowing.

Banking is the act of saving some leftover points that we aren’t going to use before the end of our Use Year, and pushing them into the following Use Year. There are restrictions on doing this – we have to bank the points at least four months before the end of our Use Year – after that, and we just have to use them or lose them. So it takes a little planning. And we can’t undo that transaction – once we bank them, we can’t pull them back if we decided to make a trip anyways. Fortunately, if we decide to make that last minute trip at the end of our Use Year, we can instead borrow those points from our next Use Year.

Borrowing is the opposite of Banking. Instead of pushing some leftover points into the next Use Year, we are actually taking some from the next Use Year to use in the one in which we are making a reservation. Again, this is a one-way transaction – once we borrow those points, but then decide to cancel the reservation, they don’t return to the Use Year they came from – and we can’t in turn bank them back either.

So, for our example, we have 20 2014 points left over after making all our plans in our 2014 Use Year bucket. Since we have a September Use Year, our banking deadline is April 30th, 2015. So before that date, we can simply bank those 20 points and they will be available to us in our 2015 Use Year. OR we could decide to make a new reservation – let’s say it costs us 58 points. So we’re short 38 points. We can borrow 38 of our 2015 points to use in our 2014 Use Year to complete the reservation.

Now, because banked and borrowed points, once moved, cannot be moved back (nor can banked points be banked again – there is no continuous “rollover” of points available), we don’t want to put them in the Vacation bucket. So instead, we have a separate bucket for each Use Year, called the “Banked/Borrowed” bucket, and once points get put in there, they can only come out for use in a reservation (or a trade-out into RCI, or one of the collections, etc.) They can never be transferred to another Use Year’s buckets again, and if unused by the end of the Use Year, they will be lost.

When you have points in the Banked/Borrowed bucket, you want to make sure you use those points first, before you use your Vacation bucket points, because at least with your Vacation bucket points you still have an option to bank them if they are unused. In most cases, the online system and Member Services will use them first, as long as they can be applied to the reservation. But if you, say, have banked AKL points but you are booking SSR during the home resort window, you’ll have to used your SSR points first, and then at the 7 month window you can call and ask Member Services to change the points use around. But like I earlier explained when booking trying to use points from multiple resorts, they will need to cancel the existing reservation and rebook it, so it can only be done if there is availability.

Holding and Reservation Points

There are two last buckets that come in to play, and they each have their own rules.

The Holding bucket is where points go if you cancel a reservation 30 days or less prior to the check-in date. You cannot bank these points, even if you are within your banking window and they were from the Vacation bucket originally. And using them is restricted in various ways. You can only use them to make another reservation in the Use Year the points belong to, and the check-in date must be within 60 days of when you make the reservation. You CAN exchange the points through an exchange program, but you still must make a reservation within a 60-day window and you CANNOT do it if it is closer than 60 days to the end of your Use Year. In addition, the “Rule of Four” still applies.

The Holding points will be lost at the end of the Use Year if they don’t get used.

This is actually where choosing an appropriate Use Year month can come into play. If you frequently travel during the same time period, and there is the possibility that you may need to cancel a reservation, you want to choose a Use Year month that is BEFORE that time period. Say, if you frequently go to WDW in August, you don’t want a September Use Year, as if you have to cancel within 30 days of that August trip, you have a VERY short amount of time to use your points, or lose them. But if you instead had a July Use Year, you’ll have most of a year to book another trip to use the points.

The Reservation bucket is a bit different. This is where points go if you “trade out” to use them for non-DVC destinations, such as cruises, Adventures By Disney, RCI, and even other non-DVC Disney resort rooms. When you do this, the Vacation Points you use become “Reservations Points” – thus the name of the bucket. Once you move points to the Reservation bucket, they can never go back again, they cannot be banked or borrowed, and they will expire at the end of the Use Year. They are very similar to Banked/Borrowed points, but they can only be used for non-DVC reservations now.

If you cancel a reservation that used Reservation points, what happens depends on the rules for the type of reservation you made. Cancellations within a certain time period might result in forfeiture of some or all of the points, and any points not forfeited return to the same Reservation bucket and can only be used for another non-DVC reservation, and possibly only for reservations within the same system (i.e. if you trade-out to do RCI, your only option may be RCI, etc.) So check all the details of what it means to make that reservation and if you have to cancel.

So I hope all that helps to make more sense of how points are handled from the member’s point of view.