How to properly record mortgage payments against a stored real estate asset?
Answers
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The value of your home, an asset, has nothing to do with your mortgage payment. There's no reason to create an asset account in Quicken unless you want to show it as part of your Net Worth, or track home improvements to know your basis for gain/loss when you sell. Your mortgage payment is reducing your loan, a liability. So you have two choices:
If you don't care about tracking the loan in Quicken, you could record the mortgage payment as a split between Mortgage Interset and Mortgage Principal expense categories. YOu could set the $3,000 payment up as a sceheduled (recurring) transaction with this split, but you'd need to go in ocassionally (it could be monthly, or just at the end of the year) to edit the split amounts for each transaciton to match your mortgage provider.
If you do want to track the value of your mortgage in Quicken, you'd set up a new Mortgage Loan account in Quicken. It doesn't need to be connected to the financial institution; just make it a manual account. Click the button to Add Loan Terms and enter the details — current balance, dates of next and last payment, interest rate. Press Continue, and on the second set-up screen, select your brokerage account for the payment source, and click the radio button for Detailed Reminder so Quicken will create the interest/principal split each month.
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