How to record loans correctly?

I am trying to figure out how to add a loan to the system, as far as I can tell there is two ways. The first create a loan account put the investment as money out and tag it to the bank account it went in to so will appear as money in. The second add it to the normal bank account it went in as money in and tag as something else and select loan. Which is correct? Also how do I record the interest?

Also how should I record grants?

Many thanks for your help

Please refer to the following thread:

Hi thank you for your reply.

I don’t understand this method. If I set the opening balance of a loan account to say -£1,500 it does not show an increase in the bank of £1,500 so when I enter in my purchases it will not reconcile as it will think there was no money to pay for them? It also shows up in the nominal accounts as whatever I call the loan account and not in the category of loans but am guessing it is still classed a loan in those accounts there is just not a way to see an overall of how much is left on all loans this way?

I tried to enter a transaction of the loan into the bank using the category loans and then enter in the repayments as transactions using the same category. The problem with this is that my bank needs to show one transaction of say £20 as out but then loan nominal account needs to show an amount for a repayment without interest and the loan interest account needs to show that but the tagging feature only allows tagging to one account, the advantage is if I have more than one loan I can see the overall amount owed the other disadvantage if I did have more than one I can’t see the individual amounts owed from them like if I set up individual loan accounts,

Is there a way to enter a loan where is also shows an increase in the bank account?

Is there a way in the nominal accounts to see an overview of individual loans and an overview of them all?

Is there a way to tag to other categories for a single transaction in the bank account?

This method assumes the loan was made prior to using QuickFile (I’ve just edited the post to clarify), in the case of a new loan you would enter a “money in” transaction on your current account equal to the loan issued and tag this as a bank transfer to the loan account. The remaining steps are the same in terms of loan repayments.

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