Mortgage/Escrow Transactions

New to using Stessa and trying to figure this out correctly, so bear with me! I have the typical mortgage payment which is ~$1,000 each month, that’s further broken down into the normal principal, interest, and escrow. Unfortunately the lender I’m using doesn’t link up with Stessa so I have to manually import this each month. My monthly escrow account is used for taxes & insurance, but I don’t have any further breakdown. Last year there were 6 disbursements from the escrow account: 4 city tax payments, 1 county tax payment, and dwelling insurance.
Each month I break down the payment under Mortgage>Principle, Mortgage>Interest, and Transfers> General Escrow. I haven’t recored any transactions yet for the disbursements for the escrow account and not 100% on the correct way to go about it. Im sure that the way I’m doing the escrow accounting is wrong and looking for some help. Thanks!

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Just looking for some advice to see if I’m doing this correctly or not. Thanks!

Sending this back to the top, still looking for some advice! I kinda want to get this settled before tax time to get a better snapshot of how our portfolio is performing. Due to the way I have it setup, our numbers seem to be way off.

I need the same. Currently they do not provide this. Not sure why, as everyone has to deal w this issue…

@jimmyb886, I think I can help. First, is an article from Stessa Help that you should read - Split & Categorize Mortgage Payments | Stessa Help Center.

When you record the Transfer>General Escrow, you are not recording an expense. You are essentially recording a transfer from your bank account to your escrow account. Once you record it, you will see it show as a negative number in the “Transfers” section of your Net Cash Flow statement. That negative number should agree to your escrow balance.

When there is a disbursement made (i.e., your lender pays your taxes), you will need to manually “+Add” the transaction. Record the transaction on the date it was disbursed from your escrow and categorize the transaction as “property taxes” or whatever the tax represents. This will be a “money out” transaction. That is your expense.

Subsequently, you will need to record the reduction of cash in your escrow account. You will need to manually “+Add” another transaction. The amount will be the same as the previous expense transaction your just posted, but this will be a “money in” transaction. Categorize the transaction as Transfers>Property Tax Escrow (or whatever the disbursement represents). Once you record it, you will see it show as a positive number in the “Transfers” section of your Net Cash Flow statement.

It seems a little goofy, but it does make sense in the long run. Essentially, when you recorded your monthly escrow payment, you are putting aside, so it reflects as a negative number. When a disbursement is made, money is theoretically being given back to you to pay for the disbursement, hence the positive adjustment to your cash flow.

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Let me make sure the workflow I’m doing is correct. Mortgage payment was ~$1,021 for January 2022.
I broke it down like this using the Split feature:

Mortgage & Loans>Principal_ $372.60
Mortgage & Loans>Interest_$279.81
Transfers>Property Tax Escrow_$368.78
All the above are “Money Out”

Also due in January were City taxes so I did this:
Taxes>Property Taxes_$461
This was Money Out, with the “Paid from Escrow” box checked

I then did this same transaction on the same date as the taxes were paid:
Transfers>Property Tax escrows_$461
This was Money In, with the “Paid from Escrow” box checked

Let me know if this looks right or what can be fixed! Thanks in advance for the help

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Sending this back up top for input

Yes, this looks correct. Only caveat is that checking the “Paid from Escrow” box on “Transfers” transactions is unnecessary since it’s not an actual “payment” or expense.

Thanks @macioceproperties for the concise explanation of how this works in Stessa. Please also see the existing forum thread on this same topic: Split and track escrow transactions separately from mortgage payments

Devin, could you or someone please review my topic I posted about “Rental Arbitrage.” Any help that you or anyone could give me on the best way to record those Rental Payment transactions would be fantastic.

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