Q2. The customer and the bank buy a house for £10 million, the bank contributing 80% of the price, by paying £8 million, and the customer contributing 20% of the price, by paying £2 million; The price of the house is further sub-divided into 10 units where the bank owns 8 units and the customer owns 2 units: Say that the total rent of the house is £75,000 per month, in which case the rent of one unit is £7500 per month. The bank gives its 8 units on Ijara (lease) to the customer for £60,000 per month. 1. Based on the rental value and the financing period, determine the monthly repayment schedule that results in the client fully owning the property at the end of the agreed rental term. 2. Detail any assumptions you have made to undertake these calculations.
Q2. The customer and the bank buy a house for £10 million, the bank contributing 80% of the price,
by paying £8 million, and the customer contributing 20% of the price, by paying £2 million;
The price of the house is further sub-divided into 10 units where the bank owns 8 units and
the customer owns 2 units:
Say that the total rent of the house is £75,000 per month, in which case the rent of one unit
is £7500 per month.
The bank gives its 8 units on Ijara (lease) to the customer for £60,000 per month.
1. Based on the rental value and the financing period, determine the monthly repayment
schedule that results in the client fully owning the property at the end of the agreed rental
term.
2. Detail any assumptions you have made to undertake these calculations.
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