How to set up owner financed loan as an asset? (Repeat)

Perry Smith

This is a duplicate question but the answer is a link which no longer works. I just sold my house and I am doing owner financing. I'd like all the automation that comes with mortgage loans such as calculating interest but I want it as an asset instead of a liability. Is that possible?

jacobs

There is no automation for lender loans in Quicken Mac at this time, although it;'s a feature users have requested.

That may sound really bad, but it's typically pretty easy to set this up manually with only a little tweaking needed.

First, for the breakdown of principal versus interest, you'll want to use one of many online sites which can generate an amortization table for the loan amount, rate and term; print the table.

Next, create an asset account for the current amount of the loan.

Create a deposit transaction in your checking account, with two split lines: one is a transfer to the asset account for the principal payment, the other is Interest Income. You find what the split amount is from the mortgage table you printed out.

Now click on that transaction and click Schedule in the bottom menu bar (or Schedule Selected Transaction from the Transactions menu) . Schedule the deposit monthly, or whatever frequency you have set up with the buyer.

Each month when you receive and deposit your loan payment, click on the next gray scheduled transaction in the register and mark it deposited. You'll likely need to adjust the date from the scheduled date to the actual date you made the deposit. At the same time, pull out your amortization table, double click the transaction, and adjust the split amounts to the correct values for principal versus interest.

So once you have this set up, all you need to do each month is tweaking the split amounts per the printed schedule -- 30 seconds of work which Quicken does not automate for you.

volvogirl

What link doesn't work?  Maybe there is a new one.

Put "Lender Loan" in the Quicken search box in the program.

See if my old notes still work or there might be a newer way....

A lending loan is a loan for which you are the lender and someone is paying you back on an amortized schedule. A lending loan is treated as an asset in Quicken that has a positive balance.

Add an Asset Account , where value of the asset is the amount you are lending. 

In the final window of account setup, when you are asked Is there a Loan on this asset?, select No. 

Open the account you just created, then click the Account Actions icon (the gear icon  on the top of the register), and then choose Convert to a Lending Loan Account. 

In the Convert this Asset to a lending loan dialog, click Convert,

Quicken creates an asset account with a payoff schedule. The account is identical to a "normal" loan account in Quicken. The only difference being the sign of the lending loan and its payments are opposite that of a "normal" loan. 

Perry Smith

Perhaps you are talking about the Windows product. Below is the window that comes up when I hit the + sign to add an account and select Asset. It doesn't even ask for a name. You have to rename "Asset" to the desired account name.

This is the question I found with the link that doesn't work: https://community.quicken.com/discussion/7863776/how-to-set-up-owner-financed-loan-as-an-asset

volvogirl

Oh sorry I missed it's for Mac.

jacobs

There is no automation for lender loans in Quicken Mac at this time, although it;'s a feature users have requested.

That may sound really bad, but it's typically pretty easy to set this up manually with only a little tweaking needed.

First, for the breakdown of principal versus interest, you'll want to use one of many online sites which can generate an amortization table for the loan amount, rate and term; print the table.

Next, create an asset account for the current amount of the loan.

Create a deposit transaction in your checking account, with two split lines: one is a transfer to the asset account for the principal payment, the other is Interest Income. You find what the split amount is from the mortgage table you printed out.

Now click on that transaction and click Schedule in the bottom menu bar (or Schedule Selected Transaction from the Transactions menu) . Schedule the deposit monthly, or whatever frequency you have set up with the buyer.

Each month when you receive and deposit your loan payment, click on the next gray scheduled transaction in the register and mark it deposited. You'll likely need to adjust the date from the scheduled date to the actual date you made the deposit. At the same time, pull out your amortization table, double click the transaction, and adjust the split amounts to the correct values for principal versus interest.

So once you have this set up, all you need to do each month is tweaking the split amounts per the printed schedule -- 30 seconds of work which Quicken does not automate for you.

Perry Smith

Thank you. It’s nice to know that it isn’t possible so I will stop looking around for it. Yea… it’s not much work.

jacobs

@Perry Smith You may want to take a second to visit the Idea post (feature request) for lender loans on this site and add your vote for it. In the yellow box under the first post, click the little black arrow to add your vote.