@HilW19
"I know it's odd, but they do it with every loan...put a deposit down. They do it when they buy a vehicle. It's the same concept. It will eventually come off of the total of the loan."
A down payment on a loan, or a vehicle, cannot create a liability. It creates an asset, a negative liability, or a negative equity amount. Those are the only options depending on what account was assigned to the down payment. What account was assigned to the down payment? If you're saying you have a positive $50K liability and a $50K reduction in the bank balance, then there's nothing further anyone can help you with because you're describing an impossibility.
If you have a positive asset or a negative liability amount, you just assign the same asset or liability account to the $50K refund received from the lender. That will zero out the asset account or the negative liability amount. If you have a positive liability amount and assign that to the deposit from the lender, you will increase the liability account to $100K.
