Fractional FAQ
What is a Fractional Program?
With three projects currently under way in Peñasco, Clifton Meridian has created a turn-key Fractional Ownership program for their buyers. Why buy the entire home or condo when you can enjoy a few weeks of use each year while still building equity in your luxury property. These spacious professionally decorated and appointed residences are being offered for sale at a fraction of the cost that a like condominium-residence or home would command under a full ownership program. Take the work and worry out of vacation home ownership while enjoying the time and equity appreciation of a beach front property.
Are Fractionals the same as Time Share?
In the traditional sense of the description, NO! Clifton Meridian's Fractional units are not comparable to the smaller vacation unit with only limited use in a non-equity hotel that you would find in a time share product. If however, you want to compare this product with other shared ownerships in luxury ocean-going yachts, private jet aircraft or luxury motor coaches, certainly. Most fractional owners are fully capable of purchasing these units outright; however these individuals are discovering the sensibility of owning the very best while paying only for what they use. These turn-key opportunities are proving to be attractive options for the very wealthy jet-set, first time vacation home owners, and families and individuals who may not have the time or the resources to wholly own a beachfront residence.
Can I sell my Fractional Interest?
Yes! Every owner will receive a ¼ or 1/8th ownership to a specific condominium residence in the form of a unique and independent Bank Trust. That ownership, which equates to a FIDEICOMISO issued from the trust department of an authorized Mexican bank, is the legal mechanism that allows owners of Clifton Meridian properties to complete a real estate transaction just like any other lot, home or condo in Puerto Peñasco. Owners can sell or transfer their ownership through the established sales office within the property or through affiliated real estate brokers.
As an owner, how often can I use it?
Owners are guaranteed equal access and guaranteed the right to use their residence one week every month (for ¼ fractional owners) or one week every other month (for 1/8th fractions) with an annual calendar rotation of weeks. Although still under consideration, because "Rocky Point" is still primarily a drive-to week end destination, ownership "weeks" will begin at 4:00pm on a Wednesday, and end at 12:00pm the following Wednesday. Every residence will be shut down or "dark" for a yet to be determined amount of time for annual maintenance (most like 2-4 weeks). This maintenance period will not affect any one owner specifically. Owners can request SPACE AVAILABLE RESERVATIONS at any time with the on-site Management Company and on-line system.
Can I rent my Equity Ownership?
Owners may wish to rent some of their vacation time throughout the year. This option is without limits and will be facilitated completely by the on-site management company. The owner will receive directly any proceeds from the rental after typical lodging expenses, taxes and management fees are deducted.
Is there an Exchange Program?
Yes! The developer, Clifton Meridian, is currently finalizing the structure and partnership of an Exchange program with a well know international organization. This program will allow all fractional residence owners to "exchange" their time, for accommodations in one of several other high end resorts around the globe.
How much does it cost?
Fractional share can be acquired for as little as $79,000.00 with only 30% down for a ¼ share interest in a studio condominium, and go up to $400,000 for a 1/8th share in the two-story 10,000 square foot penthouse. The developer is accepting a $5,000 deposit to secure select units and the protected prices quoted, at which time a Promise of Trust Agreement (PTA) will be delivered electronically to the prospective owner for review within 48 hours of their deposit. Purchasers will have approximately seven (7) days to review this document prior to making the commitment to proceed. If your choice is to proceed, a 10% down payment (which the original deposit can become a part of) will be required with the signing of the PTA. A second 10% down payment is due 30 days after the signing of the PTA, with a 3rd and final 10% installment due 60 days after the signing of the PTA. No further monies are then due from the buyer until the developer delivers finished product. At such time, Clifton Meridian has partnered with a well know U.S. finance company to facilitate loans for both whole and fractional ownership products.
Is there financing available for my Equity Share?
The same developer financing terms that are available to whole ownership buyers, is available for the fractional residences as well. Fractional owners can be into their unit for as little as 30% down, with the remainder of the balance carried by the developer through a non-qualifying loan over 15 years at 10.5% interest. Clifton Meridian is also finalizing an exclusive funding relationship with bank backed organization that specializes in fractional loans. Their typical product is a full doc qualifying 25 year loan at 8.75%.
How much are Maintenance Fees?
Maintenance fees, or HOA fees, will be billed to each fractional owner on a quarterly basis. This fee covers the typical costs of property taxes, bank trust fees, insurances, all interior and exterior maintenance, utilities, satellite TV, telephone and reserve funds for replacement of furniture and finishes. These fees are still be finalized and are directly proportional to the size of the unit. We expect the range of fees to be $235.00 - $500.00 monthly.