Mortgage weidness

[Derek Atkins]

"Tuc at Beach House" <tuctboh at gmail.com> writes:

> Hi,
>
>      More oddities. I signed up for an "Equity Accelerator".
>
>      My first transaction on my statement is a $2002.50 withdrawl. Ok, 2000
> is the mortgage, 2.50 is the fee. I split the transaction, but since the
> payment actually wasn't made, what do I mark it against?Equity? Liability?

What do you mean, "payment actually wasn't made"?

Ignore what the statement says for a minute.   What DID you pay?
Did you pay $2000 or $2002.50?

The next question to ask yourself is, in YOUR eyes (again, ignoring
what the bank says), how did your payment get allocated?

Note that generally a "fee" is an expense, not equity.

>      The second transaction is the same, so it'll be whatever is mentioned
> above.
>
>      But now, since they held my monies for a little while, there was a .36
> "Interest paid to customer". Where/how do I record that? Its not an asset
> technically since its not in my hands, right? Or is it since if I left them
> I could get it back?

"Interest paid to customer" would be "income".  So that .36 would come
from income.  As to where that money goes... That all depends on where
the money goes.  If THEY are holding it, then I suspect it would be an
Asset..   OR you could consider it a Negative Liability.  It all depends
on the initial setup.

>      The NEXT transaction they take that .36 away for me against my yearly
> enrollment fee. I can understand one side being
> "Expenses:Mortgage:Accelerator Fee", but what would be the other side ,
> which part of the line above?
>
>      This type of cycle keeps happening, with them sometimes making $5700 or
> so payments which means a large principal payment in addition to my normal
> payment.

I guess I don't understand the actual transactions going on here,
so I can't really answer this.  This isn't a Loan product that I'm
familiar with.

> Thanks, Tuc
>
> (I'm still trying to suss out Cam's help for my rental stuff. Thanks again
> Cam!)

-derek

-- 
       Derek Atkins, SB '93 MIT EE, SM '95 MIT Media Laboratory
       Member, MIT Student Information Processing Board  (SIPB)
       URL: http://web.mit.edu/warlord/    PP-ASEL-IA     N1NWH
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