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. However, 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 Chantilly, 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 property owners.
Contingency reserve is a special type of escrow.
A contingency reserve account is money that is held in savings to pay for maintenance 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 landlord.
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.
Chantilly Rental Management Resources
Basics
Fundamental info regarding management services in Chantilly.
Getting Started
Learn more about getting started with rental property management
Find A Tenant
Market your property to rent to find a dependable renter in Chantilly fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for property owners?
Cost
A breakdown of fees associated with rental management in Chantilly
Vetting
How Nesbitt Realty vets tenants for property owners.
Reserves
What is a contingency reserve account?
Territory
Where does Nesbitt Realty manage rentals?
Clients
Who uses Nesbitt Realty management services?
Do you want understand more about this local real estate market?
Our Guide to Real Estate is a handy tool for everyone who wants to find out more about Chantilly and surrounding areas. The Guide to Real Estate compiles facts regarding what has sold and what is on the market, and many compelling facts that you might not know. And, our Guide spotlights many of the benefits of life in Chantilly. Of course, all of this is helpful for purchasers and sellers, but landlords and renters will also find these resources to be quite eye-opening.
Landlord Reference
a handy archive for property owners in Chantilly
- Before you move a tenant into your investment in Chantilly
- Collections and evictions
- Communications with the renter
- During tenancy
- End of lease term and what happens when a renter breaks the lease
- How does the property owner get paid?
- How your property management company handles the association and your community
- How your property manager handles utilities
- How Nesbitt finds tenants
- Insurance matters for landlords using our property management
- How Nesbitt Realty & Management manage keys
- Chantilly rental investor responsibilities
- Maintenance, repairs & inspections for your property in Chantilly
- 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 Chantilly