A house mortgage can be setup using the account structure present in the previous section.
As an example, assume you have $60k in you bank account, and you buy a $150k house. The mortgage is charging 6% APR, and has administrative fees (closing costs, etc) of 3%. You decide to put $50k down, and thus will need to borrow $103k, which will give you $100 after the closing costs are paid (3% of $100k).
You accounts before borrowing the money:
Accounts Before Receiving Loan
The purchase of the house is recorded with a split transaction in the Asset:House account, with $50k coming from the bank (IE: your down payment), and $100k coming from the Mortgage. You can place the $3k closing costs in the same split.
Table 7.1. Buying a House Split Transaction
| Account | Increase | Decrease |
| Assets:House | $150,000 | |
| Assets:Bank | $50,000 | |
| Liabilities:Mortgage | $103,000 | |
| Expenses:Mortgage Adm Fees | $3000 |
The split will look like this in the Assets:House Account:
Mortgage Split Transaction
Which will give account totals like this:
Mortgage Account