Mortgage Not Splitting Principal and Interest Properly (Q Mac)

ntrainer

I've used Quicken for Mac for decades and certainly since our last mortgage was refinanced, about 10 years ago. The program has always properly tracked the division between principal and interest perfectly. Now, in the last two or three months, the split is off and it's driving me nuts to have to correct this calculation when it should be, you know, MATH. I can see in my payment schedule that my final payment is scheduled to be a bizarre amount — namely, that my usual payment is $2,166.24 but that final payment (due in 11/42) is $2.31. That's weird in and of itself. But the principal/interest split is getting off more and more with each month. I see no way to adjust any of this in Quicken. Help?

Quicken Kristina

Hello @ntrainer,

To help you troubleshoot, more information would help. Was there anything that happened around the same time that the split started to calculate incorrectly (power outage, unexpected computer or program shutdown, program update, etc)? Is the mortgage account a manual account, or is it connected to the financial institution for download? Where are you seeing the incorrect split (bill reminder, in an account register, etc)?

Thank you.

ntrainer

Sorry for not checking in on this until now…These are good questions. I can't recall anything in particular "causing" this issue, though surely there was a program update somewhere in there (as there has been at least one recently). This is a manual account which does not connect for download. It's recorded as a loan, under "Debt." The split between principal & interest is therefore calculated within Quicken, based on the loan's opening balance, interest rate, and payment amount. Those have not changed. But suddenly the split is wrong.

NotACPA

Are there any additional components of your mortgage payment …such as an Escrow account.

When you open the account register for the loan, do you see any transactions other than the monthly payments.

Can you provide use with a snapshot of your most recent mortgage payments splits, and with the interest rate, etc re: the loan?

ntrainer

To answer your questions as best I can:

• No, there are no other components of my mortgage payment other than principal and interest. I pay directly and I pay my taxes/insurance on my own.

• Nope, no transactions other than the monthly payments, either.

• Hmmm…. I'm not sure what you're looking for in terms of a snapshot. I'm manually correcting these transactions so they are correct. So a screenshot of just the split of my prior transactions won't tell you much. This might help, though:

You can see my interest rate, payment, and the correct current balance and the (manually corrected) payment that will post on 10/30/23. Notice that this next payment decreases the principal by $1085.74 and that most of my payments this year basically increase this "payoff" amount by about $3/month. But the payment after THAT would pay off the principal by about $7. I've got a working spreadsheet which tells me this next payment (due 12/1) should split into $1089.02 in principal and $1077.22 in interest. For the life of me I don't understand why Quicken isn't calculating this correctly.

NotACPA

The payment from your bank account is supposed to be split between your Mortgage account (to reduce the amount of the loan due) and Interest, which is an Expense category.

It appears that you're making the payment from one checking account (5/3) to another checking account (Cap One) which is why your mortgage amount isn't reducing.

And, what I was asking for was the transaction splits (only needed one) in your checking account.

It's a bit difficult to understand exactly what's going on since your timeline on the left doesn't match that on the right

NotACPA

Also, what was the original amount of your loan, and the term (30 yrs), so I can calculate this out myself.

ntrainer

Not ACPA…. I can't understand your confusion. My payment IS being made from one checking account (Capital One Checking), split between the Mortgage account (held by 5/3) and the expense category "Interest". That is precisely how these payments have been recorded literally from the moment this loan was opened until now. Things had been going swimmingly until a few months ago.

What you are seeing in my screenshots above is the account called "Mortgage" on the left — which shows historical decreases in my principal — and on the right you are seeing that mortgage's future "payment schedule," which is totally incorrect. I've done a spreadsheet on this myself, so I'm well aware of how wrong it is. Heck, if you really need it, here's a screenshot for last month's payment, from my Capital One checking account:

If you compare this with the screenshot I sent you previously, you'll see that the transfer to "Mortgage" is recorded in my the "Mortgage" register properly as a decrease in principal. The interactions of the accounts are working fine. What's not working is Quicken's calculation of the split between principal and interest.

To answer your final question, this was a loan for $475,000, with the first payment due 12/1/2012 (and paid the day before, as is my custom). It's a 30-year loan, so after my 11/1 payment (already entered in Quicken) I will have 228 payments remaining. As you can see from my original screenshot, Quicken calculates that my next payment, due 12/1/23, will decrease my principal by $1,092.31. According to my calculations and/or any table you might consult, that amount should be $1,089.02.

Austin@

@ntrainer When looking at the mortgage account in Quicken (left side of your screenshot from October 20), can you click the "Edit Loan and Payment Terms" option under the account name, then on the "Loan Details" tab, see what date is filled in for "Next Payment"? One other thing I'm noticing from your screenshot on October 20 is it looks like the future payment at the bottom of the (for October 30) was already marked as paid (before the actual payment date). Normally it looks grayed out rather than black until it is marked as paid. Once it's marked as paid the schedule will move on to the next unpaid payment. I normally leave mine unpaid (so it's grayed out and has the clock icon next to it in the register) until the payment date, at which point it automatically gets marked as paid. Here is my loan and payment details screen:

And here's my scheduled transaction details (when I go to my checking account register, double click on the next future-scheduled instance, then choose "Edit All Instances":

I'm curious how your setup looks in there spots. Are you marking the mortgage payment as paid in your checking account before the actual payment date?

ntrainer

Austin@, you're right: I'm marking the mortgage payment as paid in my checking account when I'm gearing up to transfer money into my checking account at the end of the month (when all the big bills come due). Basically, I mark it as "paid" in Quicken once I've gone online to my Capital One checking account to schedule the payment. I wouldn't think that would be a problem. You asked for my setup on certain screens, though. Here goes:

Austin@

@ntrainer Thanks for the update. I'm pretty sure marking the payment as paid before the actual payment date is the culprit here. I just did some testing to confirm, and as soon as I mark the future-dated mortgage transaction as paid, my mortgage account and schedule then shows the next payment date as the one after that (12/1, in this case). If I click "Edit Loan and Payment Terms" and manually set the next payment date back to 11/1 instead of 12/1 (1st screenshot in your most recent post), Quicken will re-create the bill reminder transaction (not yet marked as paid) for 11/1—I wouldn't recommend doing this since then you'll have two transactions for your 11/1 payment: the one you already marked as paid and the new one Quicken created that is still pending. Hopefully that makes sense.

I would recommend either manually marking your mortgage payment transaction as paid only when you've actually paid it in real life to your mortgage company (not when it is scheduled with Capital One ahead of time), or set your scheduled transaction to automatically mark itself as paid and set the transaction to the date you scheduled with Capital One. If you want to keep doing it how you have been, just be aware that that is why Quicken is showing and calculating the next payment amounts as the month after the payment that has been marked as paid already. Hopefully that helps!

ntrainer

Austin@, what a strange situation but I've tried manually editing the next payment to 11/1 and you are RIGHT; that gives me the correct split between principal and interest for the payment that SHOULD take place on 12/1. Now: How in the world can I fully correct this situation without having Quicken convinced that my mortgage payments are insanely late? I think I understand why the calculation is off: Quicken thinks that I have 228 payments remaining right now. In reality, there are 229 payments remaining. But I have no idea how to correct this so that the split is correct, other than having the payment that is ACTUALLY due on 12/1 sitting as a reminder that it should have been paid on 11/1. That doesn't seem like something I'd prefer to do…. Is there another option?