I have searched on the guides with no result.
Thanks.
Attach the loan documentation (scanned) which will include legal requirements and interested parties.
If you want the names to appear in a different specific location, you will need to say what sent Manager documents you need the names on.
Edit
Miss read above post.
Answered interested parties not interest charges.
Uses a payment to a balance sheet interest account unless interest adds to loan value
Create a journal entry with a debit to the interest expense account and a credit to the loan liability account for the amount of interest charged on the loan.
If your repayments include a capital element and an interest element, then after you have created a Loan account as a Liability account and an Interest paid as an expense account, when you make the payment do as follows
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Yes interest ads to loan value. Payment goes into loan and interest comes out.
How do I enter that process ?
Ah. I think Tony & Joe have provided the answers.
I’ll try them.
Thanks Tony & Joe & Patch.
Thanks for the picture !
Thank you all.
H Folks, I am still having trouble with the bank loan entries.
Monthly payment comes out of a bank account. No problem.
Then the interest and the bank fees are deducted from the loan.
How do I enter the interest and the bank fees which are deducted from the loan ?
With the way I have been doing it, the bank balance is wrong and so is the loan balance.
Thanks for your help.
You need more than one line item on the payment form. The first is posted to the loan liability account for the amount of principal. The second is posted to an interest expense account for the amount of interest. If there are other fees, they are posted to a suitable expense account for their actual cost. The sum of the payment will equal the amount paid from the bank account.
If the loan account is a bank account, that is, does it function like your other bank accounts, say credit card, if yes, then can you use the “import bank statement” and then use the bank rules to allocate the transactions.
If not, then you can use a monthly Journal entry or alternatively incorporate that “Journal Entry” within the monthly payment - see examples below - if the details are known.
Assuming that the monthly repayment is a fixed amount, say 500, and the interest and bank fees are variable monthly amounts then your monthly payment transaction would be:
February
March
Alternately you could enter the data on lines 2 to 5 via a monthly Journal Entry.
What do you mean by the interest and the bank fees are deducted from the loan ?
Do you mean deducted from the loan payment?
They are not deducted from the loan account as they would then reduce the amount of the loan
Perhaps you could explain how you have setup the accounts - showing screen images would help to understand what you have done
The monthly repayment is taken from a BANK account.
Then the interest and bank fees are taken from the LOAN account.
The loan account is a liability account, and I am having trouble entering anything into the loan liability account.
When the loan repayment is made the loan balance owing is reduced.
Then the interest and the fees are taken from the loan, which then increases the balance owing.
None of this explanation is understandable. When you refer to the “LOAN account,” are you referring to your account with the lending institution, or to an account you set up in Manager? It is impossible, from what you have written, to tell what amounts are being applied to, added to, or deducted from which account balances or payments.
Fees and interest cannot be taken from a loan. They might be (and almost always are) deducted from your loan payment, leaving a portion of the payment to be applied against the loan principal, reducing your liability. If you don’t pay on time, fees and interest can be added to the loan principal, since your failure to pay effectively constitutes the borrowing of more money.
Before anyone can really tell you how to record these transactions in Manager, you need to explain—in complete detail—exactly what is going on in the real world. Whatever that is, there will be a way to record it in Manager. But no-one can offer help based on implausible descriptions of what is actually going on.
OK Example from my bank LOAN statement - lending instutition -
March 16 Interest charged $482.71 Balance now $154,682.88
Next line on that statement - Fee for servicing your loan = $8. Balance now is $154,690.88
Next line on same page - Payment to property loan = $797.00 leaving balance of $153,893.88.
The only transaction on my REGULAR BANK account statement is the $797.00 loan payment.
So on Manager, how do I enter the other 3 onto the liability account for the loan I have created in Manager?
Screen shots - account # are acronyms -
You need to do what Brucanna said backinpost #11
You will have to have the following accounts setup
Your bank account from which you make the payment
Your loan account
An expense account where you charge the interest due
An expense account where you charge the fees due
Then you make a payment from your bank account with the following lines
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@jav, the key to understanding both @Brucanna’s and @Joe91’s illustrations is to realize there is a difference between your financial institution’s statement covering servicing of your loan and the loan principal itself. The principal is the loan. The statement includes other things. The two illustrations used different names for accounts and amounts, but were otherwise identical in concept.
I think you have been fixated on matching the statement. While there is nothing wrong with that, taking that approach requires more line items offsetting one another. If you go back to my post #10, using your latest numerical examples would mean you entered a payment as follows, with three line items adding up to the total payment:
| Account | Amount |
| — | — | ------: |
| Loan liability | 306.29 |
| Fee expense | 8.00 |
| Interest expense | 482.71 |
| Total bank payment | 797.00 |
Notice that all amounts entered are positive. Manager knows from the context whether to debit or credit the accounts. Posts to the loan liability, fee expense, and interest expense accounts are all debits. The total payment from the bank account is a credit. But you don’t have to worry about that. The program does it for you.
Notice also that the amount applied to principal in the loan liability account must come either from a precalculated schedule or be determined from the other three figures. Whether you have a payment schedule will depend on the terms of the loan. If your payment is applied as of a fixed date, regardless of when you make it, you might have one. Otherwise, just calculate the value from the other numbers. Or, since you have the servicing account statement, you can calculate the difference in balances after the most recent and previous payments. The most recent balance, by the way, should match the current balance of your loan liability account.
Thanks everybody … BUT … the interest and the service fee are taken out if the LOAN account, not the account where the loan payment is paid from.
The loan account is decreased by the payment, then INCREASES by the interest charge AND the service fee.
When I enter as you guys have told me to, all the balances are wrong, the normal bank account, and the property loan liability account.
I need to be able to take the interest and the service fee from the property loan account, not the bank account.
As in this screen shot, BOTH. figures are being taken from the BANK account instead of the liability account which is the property loan account.
Remember the bank acc number is like an accronym. Not the correct number.
Do I need to crate a NEGATIVE bank account for the property loan ?