Do you know the difference between contingency reserves and operating funds?
Operating funds are funds that our property management and real estate business uses to fund our business. Operating funds are our money. Above all, escrow funds are different. Escrow funds are monies that Nesbitt Realty is holding on behalf of tenants, landlords, buyers and sellers. Escrow funds are not our money, but they are monies that we are trusted to safeguard. At any given time, Nesbitt Realty has hundreds of thousands of dollars in escrow accounts.
In Arlandria, the Commonwealth of Virginia requires that all real estate licensees manage escrow funds in a particular manner. Most importantly the Commonwealth requires that escrow funds are properly accounted for at all times. In additional all escrow funds must be kept separate from operating funds. The biggest portion of our escrow funds are tenant security deposits, but also hold deposits for purchasers (and sometimes sellers) as we'll as contingency reserve funds for property owners.
Contingency reserve is a special type of escrow.
A contingency reserve account is money that is held in escrow to pay for maintenance and other incidentals that occur during rental management. Although the money is in our escrow account, the money belongs to the real estate investor. If the property management ends, that money is promptly returned to the property owner.
When a repair bill arises we use money in the contingency reserve account to pay that bill. When bills are paid in this manner the account is depleted. When the account is missing funds, at the end of the month when new rents are paid, Nesbitt Realty replenishes the count with money withheld from this rent. As property managers, Nesbitt Realty prepares a statement each month to show if/when money is depleted and how/when money is replenished into the contingency reserve account.
Landlords do not pay us money to set up the contingency reserve account. Instead, Nesbitt Realty withholds money from the first month of rent in order to set up the account.
Arlandria Property Management Resources
Basics
Basic info regarding property management in Arlandria.
Getting Started
Learn more about getting started with rental property management
Find A Tenant
Market your property to rent to find a great tenant in Arlandria fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for landlords?
Cost
An overview of prices of rental management services in Arlandria
Vetting
How Nesbitt Realty checks the backgrounds of tenants for landlords.
Reserves
What is a contingency reserve account?
Territory
Where does Nesbitt Realty manage rental property?
Clients
Who uses Nesbitt Realty management services?
Do you want understand more about this area?
Our Guide to Real Estate is a handy resource for anyone who needs to find out more about Arlandria and neighboring areas. The Guide to Real Estate compiles information regarding what has sold and what is on the market, and many shocking facts that you might not be aware of. And, our Guide has many of the fundamentals of living in Arlandria. Yes, all of this is useful for buyers and sellers, but property owners and renters may also find this information to be somewhat eye-opening.
Landlord Reference
a useful archive for landlords in Arlandria
- Before you rent out your rental in Arlandria
- Collections and evictions
- Communications with the tenant
- During the lease term
- End of lease term and what happens when a tenant breaks the lease
- How does the owner get paid?
- How your property manager handles the association and your community
- How your property manager handles utilities
- How Nesbitt finds tenants
- Insurance matters for rental investors using our rental management
- How Nesbitt Realty & Management manage keys
- Arlandria owner responsibilities
- Maintenance, repairs & inspections for your property in Arlandria
- The move-in inspection
- Property management information form
- Selling a 1031 tax exchange & more
- Starting our management of your rental
- When owners don't yet know their new address
- Vetting renters in Arlandria