Do you know the difference between contingency reserves and operating funds?
Operating funds are funds that our real estate brokerage uses to pay for our business. Operating funds are our money. Nevertheless, 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 West McLean, 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 repairs 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.
Real estate investors 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.
West McLean Rental Management Resources
Basics
Basic information regarding rental managment in West McLean.
Getting Started
Learn more about getting started with rental property management
Find A Tenant
Market your property to rent to find a dependable tenant in West McLean fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for real estate investors?
Cost
A list of prices of rental management in West McLean
Vetting
How Nesbitt Realty vets 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 need know more about our local real estate market?
Our Guide to Real Estate is a free resource for everyone who hopes to review important real estate information about West McLean and neighboring areas. The Guide to Real Estate compiles data regarding what has sold and what is currently listed, and a few compelling facts that you may not be aware of. Furthermore, our Guide highlights some assets of residing in West McLean. Definitely, most of this is helpful for purchasers and sellers, but landlords and renters will also find these tools to be very eye-opening.
Landlord Reference
a useful source for landlords in West McLean
- Before you rent out your investment in West McLean
- Collections and evictions
- Communications with the tenant
- During the lease term
- End of tenancy and what happens when a renter breaks the lease
- How does the rental investor 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 owners using our property management
- How Nesbitt Realty & Management manage keys
- West McLean rental investor responsibilities
- Maintenance, repairs & inspections for your rental property in West McLean
- The move-in inspection
- Property management information form
- Selling a 1031 tax exchange & more
- Starting our management of your rental property
- When landlords don't yet know their new address
- Vetting tenants in West McLean