Class: RVGP::Reconcilers::Shorthand::Mortgage

Inherits:
Object
  • Object
show all
Defined in:
lib/rvgp/reconcilers/shorthand/mortgage.rb

Overview

This reconciler module will automatically allocate the the escrow, principal, and interest components of a mortage debit, into constituent accounts. The amounts of each, are automatically calculated, based on the loan terms, and taking the residual leftover, into a escrow account, presumably for taxes and insurance to be paid by the mortgage provider.

Its important to note, that a single reconciler rule will match every mortgage payment encountered. And, that each of these payments will generate four transactions in the output file:

  • The initial payment, which, will be transferred to an :intermediary_account

  • A principal payment, which, will be debited from the :intermediary account, to the :payee_principal

  • An interest payment, which, will be debited from the :intermediary account, to the :payee_interest

  • An escrow payment, which, will be debited from the :intermediary account, to the :escrow_account

You can see details of this expansion under the example section below.

With regards to the :escrow_account, It’s likely that you’ll want to either (choose one):

  • Manually transcribe debits from the escrow account, to escrow payees, in your project’s ./journal/property-name-escrow.journal, based on when your mortgage provider alerts you to these payments.

  • Download a csv from your mortgage provider, of your escrow account (if they offer one), and define a reconciler to allocate escrow payments.

The module parameters we support are:

  • label [String] - This is a prefix, used in the description of Principal, Interest, and Escrow transactions

  • principal [Commodity] - The mortgage principal

  • rate [Float] - The mortgage rate

  • payee_principal [String] - The account to ascribe principal payments to

  • payee_interest [String] - The account to ascribe interest payments to

  • escrow_account [String] - Te account to ascribe escrow payments to

  • intermediary_account [String] - The account to ascribe intermediary payments to, from the source account, before being assigned to principal, interest, and escrow break-outs.

  • start_at_installment_number [Integer] - The installment number, of the first matching transaction, encountered by this module. Year one of a mortgage would start at zero. Subsequent annual reconcilers would be expected to define an installment number from which calculations can automatically pick-up the work from years prior.

  • additional_payments [Array<Hash>] - Any additional payments, to apply to the principal, can be listed here. This field is expected to be an array of hashes, which, are composed of the following fields:

    • before_installment [Integer] - The payment number, before which, this :amount should apply

    • amount [Float] - A float that will be deducted from the principal. No commodity is necessary to delineate, as we assume the same commodity as the :principle.

  • override_payments [Array<Hash>] - I can’t explain why this is necessary. But, it seems that the interest calculations used by some mortgage providers … aren’t accurate. This happened to me, at least. The calculation being used was off by a penny, on a single installment. And, I didn’t care enough to call the institution and figure out why. So, I added this feature, to allow an override of the automatic calculation, with the amount provided. This field is expected to be an array of hashes, which are composed of the following fields:

    • at_installment [Integer] - The payment number to assert the :interest value.

    • interest [Float] - The amount of the interest calculation. No commodity is neccessary to delineate, as we assume the same commodity as the :principle.

# Example Here’s how this module might be used in your reconciler: “‘ …

  • match: /AcmeFinance Servicing/ to_shorthand: Mortgage shorthand_params:

    label: 1-8-1 Yurakucho Dori Mortgage
intermediary_account: Personal:Expenses:Banking:MortgagePayment:181Yurakucho
payee_principal: Personal:Liabilities:Mortgage:181Yurakucho
payee_interest: Personal:Expenses:Banking:Interest:181Yurakucho
escrow_account: Personal:Assets:AcmeFinance:181YurakuchoEscrow
principal: 260000.00
rate: 0.0499
start_at_installment_number: 62

… “‘ And here’s how that will reconcile one of your payments, in your build: “‘ … 2023-01-03 AcmeFinance Servicing MTG PYMT 012345 Yukihiro Matsumoto

Personal:Expenses:Banking:MortgagePayment:181Yurakucho    $ 3093.67
Personal:Assets:AcmeBank:Checking

2023-01-03 1-8-1 Yurakucho Dori Mortgage (#61) Principal

Personal:Liabilities:Mortgage:181Yurakucho    $ 403.14
Personal:Expenses:Banking:MortgagePayment:181Yurakucho

2023-01-03 1-8-1 Yurakucho Dori Mortgage (#61) Interest

Personal:Expenses:Banking:Interest:181Yurakucho    $ 991.01
Personal:Expenses:Banking:MortgagePayment:181Yurakucho

2023-01-03 1-8-1 Yurakucho Dori Mortgage (#61) Escrow

Personal:Assets:AcmeFinance:181YurakuchoEscrow    $ 1699.52
Personal:Expenses:Banking:MortgagePayment:181Yurakucho

… “‘ Note that you’ll have an automatically calculated reconcilation for each payment you make, during the year. A single reconciler rule, will take care of reconciling every payment, automatically.