Do you know the difference between contingency reserves and operating funds?
Operating funds are monies that our real estate brokerage uses to pay for our business. Operating funds are our money. But, 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 Parker Gray, 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 property owner. 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.
Owners 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.
Parker Gray Rental Management Resources
Basics
Elementary information regarding rental managment in Parker Gray.
Getting Started
Learn more about getting started with rental property management
Find A Tenant
List your property to rent to find a dependable renter in Parker Gray fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for real estate investors?
Cost
A list of prices of property management services in Parker Gray
Vetting
How Nesbitt Realty vets tenants for our clients.
Reserves
What is a contingency reserve account?
Territory
Where does Nesbitt Realty manage property?
Clients
Who uses Nesbitt Realty management services?
Should you know more about our local real estate market?
Our Guide to Real Estate is a helpful tool for everyone who needs to find out more about Parker Gray and neighboring communities. The Guide to Real Estate provides data regarding what has sold and what is currently listed, as well as many compelling facts that you might not know. In addition, our Guide features some assets of life in Parker Gray. As a matter of course, all of this is useful for purchasers and sellers, but rental investors and renters might also find these tools to be very enlightening.
Landlord Reference
a useful source for rental investors in Parker Gray
- Before you rent out your rental in Parker Gray
- Collections and evictions
- Communications with the renter
- During the lease term
- End of lease term and what happens when a tenant breaks the lease
- How does the property owner get paid?
- How your management company handles the association and your community
- How your rental manager handles utilities
- How Nesbitt Realty finds tenants
- Insurance matters for rental investors using our rental management
- How Nesbitt Realty & Management manage keys
- Parker Gray owner responsibilities
- Maintenance, repairs & inspections for your rental property in Parker Gray
- The move-in inspection
- Property management information form
- Selling a 1031 tax exchange & more
- Starting our management of your rental investment
- When landlords don't yet know their new address
- Vetting tenants in Parker Gray