Do you know the difference between contingency reserves and operating funds?
Operating funds are monies that our real estate brokerage uses to fund our business. Operating funds are our money. Still, 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 Mount Vernon, 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 landlord clients.
Contingency reserve is a special type of escrow.
A contingency reserve account is money that is held in escrow to pay for repairs and other incidentals that occur during property management. Although the money is in our escrow account, the money belongs to the landlord. If the property management ends, that money is promptly returned to the real estate investor.
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.
Mount Vernon Property Management Resources
Basics
Basic information regarding management services in Mount Vernon.
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 Mount Vernon fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for landlords?
Cost
An overview of fees associated with rental management services in Mount Vernon
Vetting
How Nesbitt Realty checks the backgrounds of tenants for property owners.
Reserves
What is a contingency reserve account?
Territory
Where does Nesbitt Realty manage property?
Clients
Who uses Nesbitt Realty management services?
Do you want understand more about the community?
Nesbitt Realty's Guide to Real Estate is a handy resource for everyone who wants to review important real estate information about Mount Vernon and nearby areas. The Guide to Real Estate compiles information about what has sold and what is currently listed, and a couple of surprising facts that you might not know. Also, our Guide has many of the assets of residing in Mount Vernon. Of course, most of this is useful for buyers and sellers, but rental investors and renters will also find this information to be very enlightening.
Landlord Reference
a useful source for rental investors in Mount Vernon
- Before you lease out your rental property in Mount Vernon
- 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 rental manager handles the association and your community
- How your property management company handles utilities
- How Nesbitt Realty & Management finds tenants
- Insurance matters for landlords using our rental management
- How Nesbitt Realty & Management manage keys
- Mount Vernon property owner responsibilities
- Maintenance, repairs & inspections for your property in Mount Vernon
- The move-in inspection
- Property management information form
- Selling a 1031 tax exchange & more
- Starting our management of your property
- When owners don't yet know their new address
- Vetting tenants in Mount Vernon