Do you know the difference between contingency reserves and operating funds?
Operating funds are funds that our property management and real estate business uses to pay for our business. Operating funds are our money. Above all, 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 Grass Ridge, 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 rental 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.
Grass Ridge Rental Management Resources
Basics
Elementary information regarding management services in Grass Ridge.
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 Grass Ridge fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for property owners?
Cost
An overview of prices of rental management services in Grass Ridge
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 need understand more about this community?
Our Guide to Real Estate is a free tool for everyone who wants to learn more about Grass Ridge and nearby areas. The Guide to Real Estate provides information regarding what has sold and what is on the market, and some shocking facts that you may not be aware of. And, our Guide spotlights many of the aspects of life in Grass Ridge. Of course, all of this is interesting for buyers and sellers, but property owners and tenants may also find this information to be very sobering.
Landlord Reference
a free reference for rental investors in Grass Ridge
- Before you rent out your property in Grass Ridge
- 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 property management company handles the association and your community
- How your property management company handles utilities
- How Nesbitt Realty finds tenants
- Insurance matters for rental investors using our property management
- How Nesbitt Realty & Management manage keys
- Grass Ridge owner responsibilities
- Maintenance, repairs & inspections for your property in Grass Ridge
- The move-in inspection
- Property management information form
- Selling a 1031 tax exchange & more
- Starting our management of your rental
- When owners don't yet know their new address
- Vetting renters in Grass Ridge