When setting up your mortgage in PocketSmith, we have various recommendations for setting up budgets and categories for your regular loan and interest repayments (see: Managing mortgages within PocketSmith). However, your mortgage drawdown transactions and the initial property purchase transactions are best treated as transfers and categorised separately to avoid skewing your day-to-day spending or your loan repayment budgeting and reporting.
Categorising property purchase and loan drawdown transactions
When purchasing your home, you'll likely make an initial deposit, then draw down a loan, and make a settlement payment for the remaining balance.
We recommend assigning these to a transfer category specifically for these initial transactions—you could call this 'House purchase', for example:
For details on how to create a transfer category, see: Steps to create a transfer category
This way, these transactions will be removed from the Earning and Spending chart on your Dashboard, the Digest page, and the Income & Expense report. They won't skew your day-to-day spending or interfere with any budgets for loan repayments.
Transfer transactions are also excluded from totals on the Budget Summary (at the top of the Budget page) and the overall figure on the Trends page.
Note
Transfer Transactions will still show on the Cashflow Statement and the Transactions page bar graph, though you can remove them from these, as detailed in our guides:
Add your home as an asset
Once you've added your mortgage accounts or home loans, don't forget to add your home or property as an asset, as this will offset the loan in your Net Worth calculations 🏠 🙌
For details on adding your home as an asset, see: Mortgages: Adding your home as an Asset
Categorising transactions when refinancing a mortgage
If you are refinancing your mortgage, we recommend that any transactions associated with the refinance be treated as a transfer. For example, where the balance is paid off in the original loan account, and further funds are drawn down in a new account.
We recommend assigning these to a transfer category specifically for the refinance transactions. You could call this 'Mortgage refinance', for example:
For details on how to create a transfer category, see: Steps to create a transfer category
This way, these transactions will be removed from the Earning and Spending chart on your Dashboard, the Digest page, and the Income & Expense report. They won't skew your day-to-day spending or interfere with any budgets for loan repayments.
Transfer transactions are also excluded from totals on the Budget Summary (at the top of the Budget page) and the overall figure on the Trends page.
Note
Transfer Transactions will still show on the Cashflow Statement and the Transactions page bar graph, though you can remove them from these, as detailed in our guides: