HOW THE 100% FINANCE AGREEMENT WORKS

Purchase price of Apartment.................. £100,000

Reservation Fee –refundable when deposit paid ..............£1,000

Deposit required within 45 days of reservation = 30% of purchase price......... £29,000

If deposit is via a loan then Harlequin will provide the loan repayments subject to the following criteria, Capital and Interest repayments must be over 10 years. Interest only payments must be over 5 years. If deposit funds are provided from a cash source then Harlequin will pay the Investor a 6% monthly payment on the amount provided.

Example is via a loan – Interest only at say 7%, therefore calculated at £175 per month or £2,100 per annum, we will estimate the time to completion at 42 months therefore 42 times £175 rolled up is £7,350

At the various stages of construction we will require payments as follows,

Foundations completed 25% Watertight construction 25%

Fitting out 15% Final completion 5%

If the Investor prefers not to pay these amounts then Harlequin will charge an Interest amount for a maximum time of 18 months for an Apartment and 12 months for a Villa- £7,300

Final Investor account on completion is:

Balance of purchase price.......................... £70,000

Deposit loan repayments rolled up .....................£7,350

Interest on staged payments rolled up ...........£7,300

Original deposit repaid .................................£30,000

Total Investor requirement to pay is ......................£114,650

We would estimate that the property will increase in value to well over double it’s value, however for this exercise we will cap the increase to 75% therefore property value at completion is now ...................................£175,000

Harlequin is financially confident and will therefore assist the Investor to obtain a Mortgage on the property based on 70% loan to value at the time of completion.

70% times £175,000 ......................... - £122,500

Minus requirement of............................ - £114,650

Balance ...................................................£7,850

A 2-year Rental Guarantee of 10% of the purchase price follows, in this example the amount is £10,000 per year, which is designed to cover the Mortgage repayments, for example an Interest rate of 7% per annum this will amount to a payment of £714 per month or £8575 per year easily contained in the Rental Guarantee.

After this period of 2 years then the resort will be fully functional and the 50% net room rate payment will commence, an example of this payment is as follows, we will use an occupancy rate of 85% or the apartment will be in use for 310 nights per year.

A very moderate charge of £200 per night for two people for 310 nights is a total of £62,000 a year of which you can expect £31,000 per year.

£31,000 per year has cost you nothing and you still own the property and 4 weeks use per year.