We use an example of a customer below to enable you understand how this works in practice.
Patricia Beetles (not her real name), is a 30 year old nurse who earns £26,130.33
A. Computations based on a Price of a ONE-BEDROOM at £120,000
Legend:
GSM - Getting Started Money AR - Annual Rent MR - Monthly Rent MP - Monthly Payment OP - Option Payment
Number of Bedrooms
One Bedroom
One Bedroom
One Bedroom
One Bedroom
Duration
5 yrs
5 yrs
5 yrs
5 yrs
GSM
£ 3,000
£ 6,000
£ 9,000
£ 12,000
AR
£ 8,400
£ 7,800
£ 7,200
£ 6,000
MR = AR divided by 12
£ 700
£ 650
£ 600
£ 500
MO
£ 140
£ 130
£ 120
£ 100
MP= MR + MO
£ 840
£ 780
£ 720
£ 600
OP = MO x 60
£ 8,400
£ 7,800
£ 7,200
£ 6,000
Home Equity after 5yrs (GSM + OP)
£ 11,400
£ 13,800
£ 16,200
£ 18,000
..
B. Computations based on a Price of a TWO-BEDROOM at £200,000
Legend:
GSM - Getting Started Money AR - Annual Rent MR - Monthly Rent MP - Monthly Payment OP - Option Payment
Number of Bedrooms
Two Bedroom
Two Bedroom
Two Bedroom
Two Bedroom
Duration
5 yrs
5 yrs
5 yrs
5 yrs
GSM
£ 14,000
£ 15,000
£ 19,500
£ 24,000
AR
£ 14,000
£ 15,000
£ 13,000
£ 12,000
MR = AR/12
£ 1,166.67
£ 1,250.00
£ 1,083.33
£ 1,000.00
MO
£ 233.33
£ 250.00
£ 216.67
£ 200.00
MP= MR+MO
£ 1,400
£ 1,500
£ 1,300
£ 1,200
OP = MO times 60
£ 13,999.80
£ 15,000.00
£ 13,000.20
£ 12,000.00
Home Equity after 5yrs (GSM + OP)
£ 27,999.80
£ 30,000.00
£ 32,500.20
£ 36,000.00
..