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. 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 Lorton, 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 rental management. Although the money is in our escrow account, the money belongs to the property owner. When 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.
Lorton Property Management Resources
Basics
Fundamental information about what property management in Lorton.
Getting Started
Learn more about getting started with property management
Find A Tenant
List your property to rent to find a great renter in Lorton fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for property owners?
Cost
A breakdown of prices of property management services in Lorton
Vetting
How Nesbitt Realty checks the backgrounds of renters for landlords.
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?
Nesbitt Realty's Guide to Real Estate is a helpful tool for anyone who wants to find out more about Lorton and neighboring areas. The Guide to Real Estate compiles data regarding what has sold and what is currently listed, and many interesting facts that you may not be aware of. Also, our Guide spotlights many of the benefits of residing in Lorton. Yes, most of this is interesting for buyers and sellers, but owners and renters may also find the facts to be quite informative.
Landlord Reference
a useful source for landlords in Lorton
- Before you move a tenant into your investment in Lorton
- Collections and evictions
- Communications with the tenant
- During tenancy
- End of lease term and what happens when a renter breaks the lease
- How does the landlord get paid?
- How your rental manager handles the association and your community
- How your property manager handles utilities
- How Nesbitt Realty finds tenants
- Insurance matters for rental investors using our property management
- How Nesbitt Realty & Management manage keys
- Lorton owner responsibilities
- Maintenance, repairs & inspections for your rental investment in Lorton
- The move-in inspection
- Property management information form
- Selling a 1031 tax exchange & more
- Starting our management of your property
- When landlords don't yet know their new address
- Vetting renters in Lorton