The past few weeks have been turbulent to say the least for the thousands of Harlequin Property investors who have had to contend with delayed completions, missed interest payments and poor communication from Harlequin themselves.
There have also been investor meetings and Harlequin open days to attend, a constant stream of negative publicity, on-going investigations by the Serious Fraud Office (SFO) and now it seems the Insolvency Service.
Add in the move to put Harlequin Property into administration and no one would blame investors for feeling like they are on a rollercoaster ride, which they can’t get off.
So what now?
We know many investors feel they’ve lost control, whilst others will feel that this is consuming too much of their time and there is no light at the end of the tunnel. There are of course also investors willing to give Harlequin time to restructure and sort out their issues.
Whatever the outcome of your Harlequin investment, it’s clear there is action you should be taking now, to secure your financial future.
We’ve put together some hints and tips for Harlequin Property investors to follow to do just that.
Tip 1: Get legal
It’s clear some investors have run out of patience with David Ames and Harlequin Property and want to take a legal action to reclaim their money; who can really blame them?
There are essentially three options to doing this, firstly an investor could appoint their own lawyer, however the situation is horribly complex and it may be better in the long run to join one of the two main groups, who have the necessary research capability and experience. The first of these is the Harlequin Investor Group, set up by Regulatory Legal, the second being a group run by CPC Worldwide.
Whatever the outcome of the Harlequin restructure, or indeed any legal proceedings, it is clear many investors will need to take action to rectify the potential damage done to their finances, which is where the rest of our hints and tips will help you.
Tip 2: Keep up loan repayments
It’s clear many investors borrowed money to invest, either on a personal loan, a remortgage and even a credit card, on the understanding interest payments would be covered by Harlequin. However, early in 2013 without notice these interest payments stopped, leaving many investors struggling to meet their monthly mortgage or loan repayments.
At the recent investor meeting in Warrington David Ames said these payments would recommence at some point, although he was rather vague about the exact timescale. In the meantime it’s clear that if investors are to avoid negative marks on their credit file, court action and possible proceedings to repossess their home, they should try as hard as possible to keep up the repayments.
If you are struggling make contact with your bank or loan company and discuss the situation with them, this will certainly illicit more sympathy and understanding than simply ignoring their demands.
Tip 3: Review your pension
Many people invested through a SIPP (Self-Invested Personal Pension), often transferring in existing Personal Pension or old workplace pension, sometimes losing valuable guaranteed benefits at the same time.
A pension is there to provide an income in your retirement, it therefore goes without saying, if an investment fails to deliver, in part or whole, your income in retirement might be lower than you expected.
Whilst we understand you are probably not feeling particularly positive to the financial services industry right now, we’d recommend you carry out a full review of your pensions. You could do this yourself or by using an Independent Financial Adviser (IFA), who you have confirmed is regulated by the Financial Conduct Authority (FCA), which has now taken over from the Financial Services Authority (FSA).
We’d suggest you review your pensions and the income they will provide, assuming three different outcomes; a full return from your Harlequin Property investment, a partial return and a total loss; you will then be able to see the impact on your retirement plans.
We have cash flow software which would allow us to look at different scenarios, if you would like to discuss this with one of our advisers please get in touch, either by calling us on 0115 933 8433 or by emailing email@example.com
Tips 4: Take action!
Once you have seen the impact of a potential loss you can then start to plan how to make up the shortfall.
There are a number of options you could consider; working longer, paying more into your pension between now and retirement, settling for a smaller income when you finish work or indeed a combination of all three options.
Whatever you decide to do, if you have invested via a pension, it is vital you know the impact on your retirement planning now, the earlier you know, the sooner you can take action to secure a financially comfortable retirement.
Tip 5: Review the rest of your finances
If you invested your own money and not through a SIPP or after taking out a loan, you should still review the impact of this on your finances.
Although hugely frustrating, a loss on your savings might be not have such a serious impact on your long term financial future as a loss on your pension might have. However, we would still recommending projecting a number of scenarios and see how they impact on your financial future.
Tip 5: Did you buy through an IFA?
There were essentially three ways to invest into Harlequin Property, through a regulated Independent Financial Adviser (IFA), through an unregulated broker or by going direct to Harlequin.
If you invested via an FSA (now FCA) regulated IFA you should consider whether you have grounds to complain about the sale of the Harlequin investment. Not perhaps because of the investment itself, but perhaps because of the way in which you invested, for example if you were advised to transfer a final salary or defined benefit pension, which has guaranteed, index linked benefits, you may have grounds for a complaint.
The Harlequin Investor Group can certainly offer guidance here.
Tip 6: Don’t stick your head in the sand
Most investors are now taking some form of action, Harlequin have estimated that 2,000 people attended their open days in April and large numbers are signing up with the various investor groups and are active on the online forums.
As tempting as it may be, don’t stick your head in the sand, whatever happens with your Harlequin investment and we sincerely hope it works out for the best, your financial future will be affected, especially if you invested your pension fund.
In summary follow our hints and tips, find a new Independent Financial Adviser and engage with Harlequin and the various investor groups, but don’t, whatever you do, stick your head in the sand.
If you are a Harlequin Property investor we are here to help.
We’ve written extensively about the problems facing Harlequin and its investors, know the investment well and understand your concerns.
And one last thing, we are of course registered with, and regulated by, the Financial Conduct Authority (FCA); you can check this for yourself by clicking here and enter our firm reference number, which is 515511.