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.
This topic is actually discussed in detail here:
Net Cash Flow report not placing Sale Proceeds under Purchase, Sale, & Refinance
This help article also explains best practices for this situation:
Track Purchases, Sales, and Refinances