and home-buying — January 15, 2015 and home-buying

Do any of my belovèd readers a) use *and* b) own a home? I’m in the process of buying a home, so now there are these enormous checks flying around that I think Mint will just have no idea how to handle. The purchase-and-sale check was just cashed, for instance; if Mint treats this like an ordinary expense, then my net worth just dropped by tens of thousands of dollars. But in fact my net worth is the same as it ever was; I’ve just transferred that money from one pocket (checking account) into another pocket (equity).

If I’m correctly reading the official Mint answer on how to handle downpayments, the suggestion is just to ignore them. By ignoring them, the funds don’t disappear from (in this case) my checking account, so it’s like my net worth didn’t change at all. But this is obviously not right. The correct thing to do is to treat this as a subtraction from the checking account and an addition to the equity account. No disappearing transactions, no change in net worth.

If Mint suggests hiding downpayments, then it’s going to get even harder with mortgage payments. Let’s say I write a $2,000 mortgage check every month. In the beginning, maybe $500 of that will be equity and $1500 will be interest. So the mortgage check would be correctly treated as a $500 transfer from checking to equity, and a $1500 expense. Seems to me that my net worth would shrink by $1500 after every such check. But if Mint doesn’t have the capacity to treat a downpayment as a transfer to equity, then I suspect it also won’t know what to do with the equity piece of the mortgage payment.

My mortgage lender isn’t one of Mint’s partner financial institutions, and I can’t figure out how to properly register my mortgage. I can add a generic ‘loan’, but … man, is that feature undercooked. It asks me how large the loan is. I enter the amount. Then … that’s it. It doesn’t ask me for the interest rate. If it asked the interest rate, then it could compute the change in principal every month; the change in principal on a mortgage is the amount that goes to equity. But it doesn’t ask me that. So the ‘loan’ feature is, oddly, not suitable for use with mortgages.

There’s a way to add real estate, but a couple things seem wrong with that feature. First, it seems largely focused on tracking changing property values as a way to monitor the ups and downs of my net worth. And, second, it doesn’t seem to create an account of the sort that you can transfer value (e.g., a downpayment) into.

If my mortgage company were one of Mint’s recognized lenders, then I assume it would have smart backend logic to realize that when $2,000 disappears from checking and appears in the mortgage account, a fraction of that (depending upon where we are in the amortization schedule) should count as reducing my net worth, and the remainder should just be a transfer into equity.

Without the integration between Mint and my lender, I can see why it would be hard to add mortgage transactions. If I have a credit card in Mint, for instance, and I make a credit-card payment, then I assume Mint sees that $1,000 disappears from this account and appears in an account whose name looks like ‘AmEx’. But what if I have a payment to an unrecognized lender? I could put it in the ‘mortgage’ category, but Mint doesn’t know whether this is the mortgage on my first or (at this point fictional) second home. So then it can’t know the interest rate on that payment, can’t know the principal, etc.

So without integration between my lender and Mint, am I SOL? Any amount of Googling does not turn up a satisfactory solution to this.