Starting with GNUCASH

[Mike or Penny Novack]

>
>Loans have me a little baffled. Say mortgage has payment and some goes to
>reduce principal and some goes to escrow for taxes and insurance and
>interest on loan goes to expense account.  Do I use the accounts and minus
>from checking and add to escrow. then do another set of transactions minus
>from escrow and add to interest expense; credit from escrow and debit (I
>get debit and credit confused) mortgage loan... then when taxes paid credit
>from escrow and debit home insurance (expense account)?  Do I ever have a
>transaction to some type of equity account?
>
>  
>
You can do it in separate transactions but since your payment is 
actually a single item from your bank account more normal would be to 
use a SPLIT transaction (a transaction involving more than two 
accounts). The escrow account is an asset belonging to you (your 
property) except not under your control. Just like another bank account 
(some bank account controlled by the institution processing your 
mortgage). It should be in your books as an asset account. Then when you 
get a statement from the institution processing your mortgage that they 
have used some of these funds (to pay a tax bill, to pay an insurance 
bill, whatever) you enter a transaction to reflect that.

So each mortgage payment would be:
debits:
    Loan principle
    Loan Interest
    Escrow
credits:
    Bank account (this would be entered first, then hit SPLIT, adjust 
the other side amount to the first account you want to do and enter that 
account, then proceed with the remaining amount till all allocated)

Michael

PS -- As always I will repeat, gnucash AUTOMATES the bookkeeping, 
posting* from journal to ledger, but that doesn't substitute for 
knowledge about basic bookkeeping. This automation is important/useful 
since transcription errors during hand posting was one of the major 
sources of errors in the old pen and ink on paper days. If the 
documentation provided with gnucash isn't enough for you, get a book on 
"basic accounting". We can help you with "how to do it using gnucash 
way" but you may still need help with "what should I be trying to do".

-- 
There is no possibility of social justice on a dead planet except the equality of the grave.