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. In contrast, 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 Old_town, 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 buyers (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 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 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.
Old_town Rental Management Resources
Basics
Fundamental information about what management services in Old_town.
Getting Started
Learn more about getting started with property management
Find A Tenant
List your property to rent to find a dependable renter in Old_town fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for landlords?
Cost
An overview of prices of rental management services in Old_town
Vetting
How Nesbitt Realty vets renters for our clients.
Reserves
What is a contingency reserve account?
Territory
Where does Nesbitt Realty manage rental investments?
Clients
Who uses Nesbitt Realty management services?
Do you need understand more about this community?
Our Guide to Real Estate is a free resource for everyone who wants to investigate real estate facts about Old_town and surrounding areas. The Guide to Real Estate includes information regarding what has sold and what is for sale, and many compelling facts that you might not be aware of. And, our Guide features many of the aspects of living in Old_town. Definitely, most of this is useful for purchasers and sellers, but landlords and tenants may also find these tools to be somewhat informative.
Landlord Reference
a free source for landlords in Old_town
- Before you put a renter in your investment in Old_town
- Collections and evictions
- Communications with the tenant
- During tenancy
- End of tenancy and what happens when a renter breaks the lease
- How does the property owner get paid?
- How your management company handles the association and your community
- How your property manager handles utilities
- How Nesbitt finds tenants
- Insurance matters for property owners using our property management
- How Nesbitt Realty & Management manage keys
- Old_town owner responsibilities
- Maintenance, repairs & inspections for your property in Old_town
- 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 renters in Old_town