Recording mortgage payments

MarlaR

I'm from the QuickBooks world, but now using Quicken for my personal bookkeeping. I can't quite figure out how to handle simple things like recording the principal, interest and escrow on my monthly mortgage payment. The category list only allows income and expenses; nothing for assets and liabilities. Also, is there a way to re-categorize all transactions to one payee in one shot? I hope there is something I'm not seeing, because I'm trying to avoid purchasing QuickBooks Mac for $399! Thanks in advance.

jacobs

In Quicken, moving money from one account (checking) to another account (loan or liability) is a transfer, which is neither income nor expense. A Transfer in Quicken is a linked transaction which shows up in two accounts simultaneously.

To enter transfers, there are two ways:

(1) Make the Transfers column visible in your registers: click the Columns icon in the bottom toolbar, and check Transfers. In the Transfer column, you can directly select from among your other accounts to transfer to. 

(2) If you don't want to give up the space to have the Transfer column visible, there's a shortcut you can do using the Category field: enter the word Transfer, a colon, and then the name of the liability account in brackets, like this: "Transfer:[Loan Liability]". As you type "transfer", all your accounts will show up in the drop-down menu, so you can click on it and don't have to type all that.

If you have escrow to track, you'd typically create an asset account for that. When you make a payment from your checking account, it would have three split lines:
   Transfer to Loan Liability account for the principal portion of your payment
   Transfer to Escrow account for the escrow portion of the payment
   Interest expense for the portion of your payment which is interest.

You can do this all manually, as described here. You can also create a new Loan account, where you can specify the opening balance, duration of the loan, escrow amount, and Quicken should calculate the amortization of the loan and give you the proper split transaction each month. It's sometimes difficult to get it precise to the penny, especially if you're starting from an existing loan, but you might find it worth trying. (I'd advise making a backup copy of your data file, just in case you get messed up and want to wipe out that you're tried. You could also try creating a new data file just to experiment with entering your loan.)

As for changing categories for a specific Payee, there's an easy way to do that, but with a big loophole which may be problematic here. In your register, do a Search for the Payee. Select All (Command-A), and then Get Info (Command-I, or Control-Click and select Get Info from the menu). In this Transaction Info window, you can check Category, enter a Category, and click Save to change the Category for all the transactions. But… at the top of that Transaction Info window, note the very important caveat: "Split transaction detail lines will not be affected by these changes." So if you're trying to change the Category on a Payee which has splits in transactions, you will need to edit those transactions manually, one at a time. It's an annoying shortcoming the developers haven't gotten around to addressing yet.

jacobs

In Quicken, moving money from one account (checking) to another account (loan or liability) is a transfer, which is neither income nor expense. A Transfer in Quicken is a linked transaction which shows up in two accounts simultaneously.

To enter transfers, there are two ways:

(1) Make the Transfers column visible in your registers: click the Columns icon in the bottom toolbar, and check Transfers. In the Transfer column, you can directly select from among your other accounts to transfer to. 

(2) If you don't want to give up the space to have the Transfer column visible, there's a shortcut you can do using the Category field: enter the word Transfer, a colon, and then the name of the liability account in brackets, like this: "Transfer:[Loan Liability]". As you type "transfer", all your accounts will show up in the drop-down menu, so you can click on it and don't have to type all that.

If you have escrow to track, you'd typically create an asset account for that. When you make a payment from your checking account, it would have three split lines:
   Transfer to Loan Liability account for the principal portion of your payment
   Transfer to Escrow account for the escrow portion of the payment
   Interest expense for the portion of your payment which is interest.

You can do this all manually, as described here. You can also create a new Loan account, where you can specify the opening balance, duration of the loan, escrow amount, and Quicken should calculate the amortization of the loan and give you the proper split transaction each month. It's sometimes difficult to get it precise to the penny, especially if you're starting from an existing loan, but you might find it worth trying. (I'd advise making a backup copy of your data file, just in case you get messed up and want to wipe out that you're tried. You could also try creating a new data file just to experiment with entering your loan.)

As for changing categories for a specific Payee, there's an easy way to do that, but with a big loophole which may be problematic here. In your register, do a Search for the Payee. Select All (Command-A), and then Get Info (Command-I, or Control-Click and select Get Info from the menu). In this Transaction Info window, you can check Category, enter a Category, and click Save to change the Category for all the transactions. But… at the top of that Transaction Info window, note the very important caveat: "Split transaction detail lines will not be affected by these changes." So if you're trying to change the Category on a Payee which has splits in transactions, you will need to edit those transactions manually, one at a time. It's an annoying shortcoming the developers haven't gotten around to addressing yet.

MarlaR

Jacobs, thank you SO much for the detailed answer. Very helpful!

scruggser

I like the answer but i am unable to see the "Loan " as a choice for the transfer. It does show the Loan under the Property and Debt below the account listing. I have previously entered manually the principal and interest payment amounts under categories but added the loan after the fact and it won't let me go back to the previous payments. Do i have to create a new Loan that doesn't download from the mortagee automatically?

jacobs

@scruggser When you set up the Loan in Quicken, you specify the account the money is coming from on the Bill Reminder tab of the Edit Loan and Payment Details screen:


Then in your checking account, you can see the detailed transaction created by Quicken:



If you want Quicken to manage the loan like this, then yes, you do need to create a new loan, with the correct starting balance, number of payment remaining, interest rate, etc. You can't go back in time to incorporate the past payments you entered manually. But if you've got an existing Liability account you've been using manually, you can convert the Liability account to a Loan in the account Settings screen -- there's a "Convert to Loan" button there which will take you to the screen to enter all the loan details. (You do not have to connect this account to your mortgage lender to download your transactions; you can set it up as a manual account.)