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Rental Property Loan on one property for the benefit of another property

We purchased a rental property using a line of credit against another rental property. 

 

1.  The purchase price was $100,000

 

2.  The line of credit is $125,000

 

3.  We will be using the $25,000 left over for capital improvements and borrowing some more from other resources.

 

4.  We have a Notes Payable account set up but how do we set it up when using the LOC secured against one property for the benefit of another?

1 Comment
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Re: Rental Property Loan on one property for the benefit of another property

The only reason to make that allocation by property would be if you a trying to split the properties into classes and then prepare a Balance Sheet by Class? (not available in QBdt-Pro). Otherwise the new loan is just a normal liability (regardless of the underlying security) - but I would suggest that each separate loan be put in its own liability account.

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