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Creating a loan in Money Sunset RRS feed

  • Question

  • I just traded cars.  The old car still had a loan balance on it.

    How do I create a loan on the new car showing that part of the proceeds went to pay off the old car

    and thus making the old car loan balance zero.

    I have tried creating a new loan but I can't where the proceeds went.

    I also tried setting up a Liablity account but then I must manually calculate the principle and interest each month.

    JL

     

    Friday, January 21, 2011 5:56 PM

All replies

  • Money doesn't make it at all easy to deal in an accounting sense with the cashflow out of a loan you take or into a loan you make.

    See http://umpmfaq.info/faqdb.php?q=193 and http://umpmfaq.info/faqdb.php?q=86 for some ideas.

    Friday, January 21, 2011 6:57 PM
    Moderator
  • Dick, thanks for the info.  

    I created a new loan for the total amount.

    Made a deposit in my checking for the amount of the payoff of the old loan, including principle and interest, from the lending institution

    and put it in "Loan Proceeds" category as "Non-Taxable Income".

    Then made a payment back to the lending institution for the same amount and applied it to the old loan. 

    Although the deposit in my checking account doesn't look good, I made comments in the transactions and in the new loan on how the money was divided and the

    the purpose of it.

     

     

     

    Saturday, January 22, 2011 1:18 AM
  • Sounds about right. Sometimes you have to do stuff like this to keep your data sane. Memos are a good place to note why things were done the way they were in case you get back there some day and wonder.
    Saturday, January 22, 2011 2:32 PM
    Moderator