Line of credit loan - mortgage

[John Layman]

In your situation, with the payment going directly to the builder, the money
doesn't "come", it "goes."  The other side of the transaction that increases
your line-of-credit liability account also increases an expense account like
Household Services.

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From: dude man [mailto:carnmightyhawks at hotmail.com] 
Sent: Friday, May 21, 2010 1:21 AM
To: john.layman at laymanandlayman.com; jwilsondmartin at gmail.com
Cc: gnucash-user at gnucash.org
Subject: RE: Line of credit loan - mortgage


Thats different to how I thought of doing it.
I think I'll setup a loan under liabilites for the amount the bank has sent
to the builder.
My question is though how do I represent where that money comes from?
 
 
 
I won't worry about including the house as an asset at the moment
 
> From: john.layman at laymanandlayman.com
> To: jwilsondmartin at gmail.com; carnmightyhawks at hotmail.com
> CC: gnucash-user at gnucash.org
> Subject: RE: Line of credit loan - mortgage
> Date: Tue, 18 May 2010 11:11:44 -0400
> 
> I have our home equity line of credit as a sub-account under
> Liabilities/Loans/Other Loans. The actual equity asset, however, is found
> under Assets/Fixed Assets/House. I make no effort to represent the
> potential market value of the house in the asset account. Instead,
> beginning with the original purchase price, the expense of major
renovations
> transfers into (debits) the asset account. My purpose, beyond
approximating
> what the house means to our net worth, is to have a clear understanding of
> what we would have to realize from the sale of the house to break even. Of
> course, any mortgage liability (including the equity line of credit)
serves
> as an offset against the asset in our overall financial picture.
> 
> -----Original Message-----
> From: gnucash-user-bounces at gnucash.org
> [mailto:gnucash-user-bounces at gnucash.org] On Behalf Of John Wilson & Diane
> Martin
> Sent: Tuesday, May 18, 2010 9:19 AM
> To: dude man
> Cc: gnucash-user at gnucash.org
> Subject: Re: Line of credit loan - mortgage
> 
> I'm not an accountant but when I recently activated a line of credit I
> treated it as a Liability as it has to be paid off like a credit card
> account.
> I would be interested in other peoples approaches to this problem.
> HTH
> John
> On Tue, 2010-05-18 at 21:29 +1000, dude man wrote:
> > Hi, Can someone tell me how to set up a from the beginning a structure
> for a mortgage that is a line of credit loan? To complicate matters
further
> it's a construction loan so while I have been approved for the whole
amount
> only part payments of lump sums are being made to the builder.
> > 
> > I don't know what to include in the Assets/Liabilities etc.
> > 
> > If someone could point me in the right direction I would appreciate it
> > 
> > 
> > 
> > Thanks
> > 
> > 
> > 
> > Chris
> > 
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