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Acquire an Asset (with Mortgage & other expenses)

This example will guide you through acquiring an asset that includes a mortgage on the property, and also legal fees associated with the purchase. 

In this example we have the following

    • Stephen & Arlene Curtis as the Settlors of the Curtis Family Trust
    • House (Purchased in 2010 for $622,500) 
    • Mortgage on property $417,259
    • Legal Fees $1200

We recommend the following order for acquiring an asset.

1. Create Settlors as individuals via a non bank debt facility

Click I would Like to... select "Add a non-bank debt facility"

Who is providing money? You can have the Settlors listed together or separately, you can add additional notes if necessary.

 

Click Create

For help in creating a non-bank debt facility, click here

Once you have added the settlors into Trustworks, then we add the Mortgage details

2. Mortgage details via add bank account

Click I would Like to... select "Add a bank account"

Ensure that you select "Bank loan" in the drop down.  

Click Create

For help in adding a bank account, click here

Now we have added the settlors and bank loan details into Trustworks, then we add the Legal fee details

3. Legal fees via expense category

Click I would Like to... select "Add an expense category"

Click Create

For help in adding a expense category, click here

We have completed the setup of the settlors, bank loan and expense details. Now we can acquire the asset.

4. Acquire the asset

Click I would Like to... select "acquire an asset"

How are you recording this transaction?

  • As a purchase by the trust

What type of property is this?

  • Real property (real estate)

How is the property being used?

  • Non-income earning

Short title for reference?

  • Auckland House 

Address of the property?

  • Enter the necessary details
At what value was it acquired?
  • $622500

When was it acquired?

  • 12 Jan 2010

Any additional expenses?

Click on the drop down and select "Legal Fees", this was created earlier so will depend on the name you have called the expense.

Once you have entered in the relevant details, click add 

How is it being paid for?

1. Under the title Bank loan in this example has Stephen & Arlene Curtis (you created this earlier in Bank Account).

Type the reference as required, here its "Bank Loan", and also the amount; click add

The loan has being deducted from the total cost, leaving an outstanding balance.

2. To complete acquiring the asset.

Select the settlors from the "Non-Bank Debt", place a comment about the transaction, enter in the amount and click add.

NOTE: By placing a note about the transaction in the dialogue window above, this will reflect in the Debt and Gifting Report (see below). 

If you have listed the settlors separately, you will need to repeat the process to include both settlors.

"Out of Balance" must be $0.00

Once finished, click create

Asset Acquired Overview

Overview

Account Transactions

Debt and Gifting Report

 

 

 

 

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