My HELOC and reco[n]ciliation

burwell.stone

I have used Quicken for a couple years for my family and self-employment accounting. While I have business background, I am no accountant, and I don't know how to 'fix' some weird booking that occur when my bank drawas moey from my HELC to cover major transactions. How do I 'fix' this one-time? And how do I set up Quicken so that I don't have this reoccuring issue?

Tom Young

I'm not exactly grasping what the problem is here because you haven't provided any detail about the "weird booking" that has occurred.

The general recommendation when setting up a HELOC is to make it a "manual" loan - a loan where you make accounting entries as transactions occur - and that operates very much like a credit card.  That is, like a credit card, money flows in - you make payments - and money flows out - you draw on the loan to make various purchases.  Because money flows in and out and because a HELOC doesn't have a fixed amortization schedule, you wouldn't create the HELOC Account as a regular Loan Account. 

So if the bank draws money from the HELOC - maybe for fees or something - you simply make the appropriate accounting entry in the loan's register. 

Debit (increase) Loan Fees Category     $XX.XX
Credit (increase) HELOC Account          $XX.XX

Have you perhaps set this up the HELOC Account as a "downloading" loan of some sort, an Account where you have no access to the loan's register in Quicken and only bank loads affect the Account?

Tom Young

I'm not exactly grasping what the problem is here because you haven't provided any detail about the "weird booking" that has occurred.

The general recommendation when setting up a HELOC is to make it a "manual" loan - a loan where you make accounting entries as transactions occur - and that operates very much like a credit card.  That is, like a credit card, money flows in - you make payments - and money flows out - you draw on the loan to make various purchases.  Because money flows in and out and because a HELOC doesn't have a fixed amortization schedule, you wouldn't create the HELOC Account as a regular Loan Account. 

So if the bank draws money from the HELOC - maybe for fees or something - you simply make the appropriate accounting entry in the loan's register. 

Debit (increase) Loan Fees Category     $XX.XX
Credit (increase) HELOC Account          $XX.XX

Have you perhaps set this up the HELOC Account as a "downloading" loan of some sort, an Account where you have no access to the loan's register in Quicken and only bank loads affect the Account?