How to handle re-finance

- J
- John Carter
  
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posted
12 years ago

Wed, Nov 16, 2011 5:15 AM

We just re-financed our home loan to a smaller rate and reduced the number of years.

I had the old mortgage set up with an asset account and a loan account, etc. and that worked fine.

I have now talked myself out of several ways to do this and am now so damned confused that I just can't for the life of me do this in a way that makes sense.

Could someone give me the details of how they did a refi? I would try to give my rendition, except that I don't think I would get it exactly as I did/undid it.

Not anaccountant or finance major- just looking for relief.

Thanks John Carter

- M
- Mr.Jan
  
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posted
12 years ago

Wed, Nov 16, 2011 11:44 AM

I set it up with a new loan and used the old asset account. That is what you really have here is a payoff of the old loan using the proceeds of the first loan.

- B
- Bartt
  
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posted
12 years ago

Wed, Nov 16, 2011 12:22 PM

- S
- scott s.
  
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posted
12 years ago

Wed, Nov 16, 2011 7:06 PM

Bartt wrote in news: snipped-for-privacy@e3g2000vbs.googlegroups.com:

This sounds exactly what I do. Create an asset account through which all money flows related to the closing of the new loan. When done the old loan liability acct has a zero balance, the new loan liability account has the new loan balance, the closing account has zero balance and the property asset account is unchanged, unless certain costs related to closing must be capitalized. I use the HUD-1 line numbers and terms on transactions/transfers to make it easy to see where things are going.

scott s. .