Update

EEBA is now Goodbudget! Goodbudget has all the great features of EEBA (and more!) in a new and updated interface. Check out the Goodbudget Help Center for the most recent help content.

Q: I have a checking account with a Line of Credit tied to it. I sometimes borrow from a specific line and that money is deposited into my checking. Then when I’m ready to pay it back, the money is returned to the line with the applicable fees. Ex: 500.00 borrowed, when paid 550.00 returned. How do I account for this?

Here’s how to do this.

1. Set up the Line of Credit as a “Credit Card” account. Credit Card accounts in EEBA are actually good for any type of liability (loan) account.
2. When you borrow from the line, do an Account Transfer (either on your phone under the Accounts tab or on the web under Accounts…Transfer Between Accounts). Transfer *from* your Line of Credit *to* your checking account. This will *add* to the balance of the Line of Credit and to the amount available in your Checking Account. So the Line of Credit’s balance will reflect what you *owe* on that line. [Unfortunately, right now there isn’t a way in EEBA to track the “limit” on the line of credit. I might recommend just putting it in the Name, i.e., “Wells Fargo LOC ($10K)” to remind yourself.]
3. When you pay back the line of credit, you’ll want to create two transactions. First create a regular expense transaction accounting for the fee, which will be recorded to your Checking account and to an appropriate envelope, e.g., “LOC Fees”. In your example, this would be for $50.
4. Then do an Account Transfer to transfer *from* your Checking back *to* your line of credit. In your example, this Account Transfer would be for $500. This will reduce the amount in your Checking account, and it will also reduce the amount you owe on the Line of Credit.

That’s it!