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dbsw2002
Aug 17, 2022 3:23 AM UTC
Solved

Construction Holdback

A client who flips homes as his business took out an interest only mortgage loan for $618,600 in Dec 2021 with a "Construction Holdback" of $151,100. How do I set up this mortgage in Quickbooks? The heldback portion is released in varying amounts as construction aspects are completed.

Rainflurry
RainflurryAnswer
Aug 17, 2022 1:50 PM UTC

@dbsw2002 

 

There's nothing to record in regards to the holdback portion.  Record the original loan as a DR to cash, CR to loan payable, and increase the liability as the bank releases the holdback funds.  The holdback has no place on the financial statements of the company.

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5 replies

Rainflurry
RainflurryAnswer
Aug 17, 2022 1:50 PM UTC

@dbsw2002 

 

There's nothing to record in regards to the holdback portion.  Record the original loan as a DR to cash, CR to loan payable, and increase the liability as the bank releases the holdback funds.  The holdback has no place on the financial statements of the company.

    dbsw2002Author
    Aug 19, 2022 2:23 PM UTC

    Thank you,

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