Guess the split
Every payment on a co-ownership home purchase plan is part rent and part buying your share of the home, and the split moves every year. Ten rounds on one worked example: slide to your guess, lock it in, and see the real figure with the line that explains it. It is one worked example, not a quote.
Your score
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Read on: how Islamic mortgages work, what a home purchase plan is, and the calculator to run your own figures.
The worked example: a £300,000 home, a 20% deposit, an assumed rental rate of 6% held constant, and a 25-year term, so a level payment of about £1,546 a month. One worked example, not a quote: no real plan holds its rate for the whole term, and each provider’s own schedule governs.
How the split works
- Two parts in one payment: rent on the share the provider still owns, and an acquisition payment that buys a slice of that share.
- The payment stays level: each acquisition payment shrinks the provider’s share, so the next month’s rent is slightly smaller and more of the same payment buys your share.
- Slow, then fast: in this example buying your share only becomes the larger part from year 14, and you own 39% after 10 years but 73% after 20.
The same schedule is drawn as a chart on how Islamic mortgages work and on what a home purchase plan is. The calculator prices current products on your own figures.
See all ten, with the answers
| Round | Question | In the example |
|---|---|---|
| 1 | Year one. Of each £1,546 monthly payment, how much is rent? | £1,190 |
| 2 | End of year one. Your 20% deposit was your opening share. How much of the home do you own now? | 21% |
| 3 | Year five. How much of the £1,546 payment is rent now? | £1,094 |
| 4 | End of year five. How much of the home is yours? | 28% |
| 5 | End of year ten, with 15 years still to go. How much of the home is yours? | 39% |
| 6 | Year ten. How much of each £1,546 payment is rent? | £936 |
| 7 | In which year does buying your share first become the larger part of the payment? | Year 14 |
| 8 | End of year fifteen. How much of the home is yours? | 54% |
| 9 | End of year twenty. How much of the home is yours? | 73% |
| 10 | The final year. How much of each £1,546 payment is rent? | £49 |
Independent research, not financial advice. This game uses one worked example to show how a co-ownership home purchase plan works; it is not a quote, and it does not say whether any product is permissible.
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