When you have a mortgage or other large liability for an asset, you can easily keep track of it in ZipBooks.
Here's how to set up a mortgage in ZipBooks:
1.Login to ZipBooks and select Transactions from the menu.
2. Then click on Categories (aka your Chart of Accounts).
3. You'll need to create three new categories:
- Create an Asset category for the property value.
- Create a Liability category for the mortgage loan.
- Create an Expense category for the loan interest.
4. Add a new category by clicking the green + button at the top right of your categories list. Enter the opening balance as it applies. (i.e. the beginning amount of the loan or any escrow payments that have been made)
5. Click Save.
Now that you've got your categories set up, each payment will be much easier to track.
When you make a mortgage payment, the total amount will come out of your bank account, but you'll need to debit principal payments to the liability category and interest payments to your expenses category.
Note: This setup works great for standards mortgage loans. However, if you feel that you have a particularly complex case, be sure to contact your CPA.