Set Up & Track a Mortgage Loan

ChMeetings does not have a built-in loan tracking system, but you can manage a mortgage loan using a Liability Account and manual transactions. Here are the steps to follow to achieve this:

1. Optionally: Start by creating Categories and Funds that you will be specifically using to track funds related to this loan.
2. Create a Mortgage Loan Financial Account: This record represents your liability towards the loaning bank and is meant to record the payments you make towards your loan principal (the money your church actually receives). As you make payments, the balance of this financial account will decrease. This account is only for accounting purposes; it is not supposed to be linked to a bank account and does not hold actual funds. It only records the payments you make to your bank towards the loan. To create a Mortgage Loan Financial Account:
   1. Navigate to Accounting > Accounts.
   2. Click Add Financial Account.
      
   3. Set the Account Type to Liability.
   4. Enter an Account Name (e.g., " Mortgage").
   5. Input the Starting Balance (initial loan amount). You can allocate this to your default Categories and Funds or create specific ones, as mentioned above in Step 1.
   6. Click Save. You will now see a new financial account that contains transactions corresponding to your Fund and Category allocations. This account’s balance will be negative until your loan is fully paid off.
3. Record Mortgage Loan Proceeds: At this stage you are recording the money received as a result of the loan. When your church receives the money into a bank account, then you must record the following within your accounting: 
   1. Go to Accounting > Accounts.
   2. Select the Bank Account where the funds were deposited. This bank account must be linked to a corresponding ChMeetings financial account. 
   3. Click Add Transaction.
   4. Set the Type to Income.
   5. Under Category, select an existing one (or create a dedicated category if you prefer).
   6. Select a Fund or create a dedicated one.
   7. Enter the Loan Amount.
   8. Click Save. This will create an income transaction, allocated to the specified Fund and Category, with a positive balance, equal to your loan amount.
4. Record Loan Payments: Each loan payment consists of two parts: the principal and the interest. 
   1. Payments towards your loan principal are recorded within the Mortgage Loan Financial Account you created in Step 1. Each payment you track will decrease the balance of the Mortgage Loan Financial Account by the transaction amount. To track payments towards your principal:
      1. Go to Accounting > Accounts.
      2. Select the Bank Account from which you make the payment.
      3. Click Add Transaction.
      4. Set the Type to Transfer.
      5. In Transfer To, select the Mortgage Loan Financial Account you created in Step 1.
      6. Enter the Amount.
      7. Click Save.
   2. Interest Payments are an expense incurred by your loan and will therefore NOT decrease the balance of your Mortgage Loan Financial Account. Here is how to record interest payments:  
      1. Go to Accounting > Accounts.
      2. Select the Bank Account used to make the payment.
      3. Click Add Transaction.
      4. Set the Type to Expense.
      5. Select a Fund or create a dedicated one.
      6. Under Category, select an existing one (or create a dedicated category if needed).
      7. Enter the Interest Amount.
      8. Click Save.

Keep in mind that to track the flow of money received from the loan you must add transactions that record your spending. These transactions are recorded as Expense.