I just added my latest property but because of my large down payment (earnest money deposit) I ended up getting cash back from my mortgage since I financed almost 100% of the purchase.
After entering the purchase transaction and the closing costs and the proceeds from the loan I am showing a negative cash flow. That negative cash flow, plus a disbursement check I have in my hand from my lender equal the down payment I had made.
When I tried to account for the down payment as a Transfer it does not impact the cash flow. So how should I account for that down payment and the check I will be depositing from my lender?
Any answers on this? I was unsure if I should label the money I used as a down payment as owner contributions or use the transfer>down payment option. I accounted for the break down of the actual money to close, which showed in the transactions, but I didn’t see the cash I put in.
So, the “cash you put in” should be the net of the purchase price plus closing costs, less loan proceeds. If the loan proceeds exceed the purchase price + closing costs, then you’ll show a “cash out” situation.
I’m adding a new property and am still confused by this since the link you posted doesn’t go over down payment specifically. If I buy a home for $170,000 and put down $42,500 do I account for that someplace? Total cost to close was $49,282.67 so that means I had $6,782.67 of closing costs to account for in addition to the down payment, I understand those I should talk with a CPA about.