You have a certain allotment of points that you have purchased within each use year. However, you can increase the number of points available in any use year. Banking means taking points from a previous UY and moving it forward a year. Borrowing means taking points from an upcoming UY and moving them back a year.
Example. I have a 100 point contract with a June UY. I want to book a trip in October 2020 that will cost me 230 points, but I only have 100 points in my June 2020 UY. I have 50 unused points in my June 2019 UY, so I can bank those into my 2020 UY and now I have 150 points in my June 2020 UY. Still not enough, so now I borrow 80 points from my June 2021 UY, giving me a total of 230 points in my June 2020 UY, and only 20 points left in my June 2021 UY.
You can bank all the points from a particularly use year. You can bank any or all of your points, and you can do partial bankings before the banking deadline as many times as you want until all your points are banked. However, the one restriction is that you can only bank your points during the first 8 months of your use year. After that, your points have to stay in the UY they are in.
It is very important if you are not using your points in a UY to remember to bank them on time. We recommend to set up an account on our website which can send you automatic notifications of all your contracts or setup a notifcation on your phone a few days before your banking deadline to ensure you do this. Disney does post reminders on the DVC website, but this is only helpful if you are regularly going onto the site.
There really are no restrictions on borrowing. You can borrow all your points from the next UY and you can do it anytime you want. And remember, you do not have to be actually IN the UY that you are borrowing into. For instance, I could plan a trip for June 2020 with my March 2020 UY, and even though I am booking it in July 2019, I can still borrow from my March 2021 UY for the June 2020 date. The one caveat to borrowing is below.
You are out of luck. Banking and Borrowing are both "Final Transactions". That means once you move your points into a different UY, they are going to stay there. The one exception is that sometimes Disney MS (member services) will reverse a bank/borrow if you did it only recently and change your mind - like within 24 hours. This isn't a guarntee however, so make sure when banking and borrowing you are sure of yourself.
While Disney doesn't do it automatically per se, they WILL when booking a trip give you the options to use your points in the most logical manner. Typically this is banked points first, then borrowed points, then points from within the UY itself. However, if you have enough points in your UY, Disney won't ask you if you want to bank points for the trip, so you may need to pre-bank the points before making a reservation.
Good question. You cannot borrow points to a previous UY, but you CAN bank the points to the next UY. Remember that transferred points retain their original UY, so if they don't match your UY you must be careful as Transferred points cannot be seen on the website. (See Point Rentals and Transfers)