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. But, 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 Inventory, 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 savings 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 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.
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 Inventory Rental Management Resources
Basics
Fundamental info about what property management in West Mclean Inventory.
Getting Started
Learn more about getting started with rental property management
Find A Tenant
Market your property to rent to find a reliable renter in West Mclean Inventory fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for real estate investors?
Cost
An overview of prices of rental management services in West Mclean Inventory
Vetting
How Nesbitt Realty checks the backgrounds of renters for our clients.
Reserves
What is a contingency reserve account?
Territory
Where does Nesbitt Realty manage rental property?
Clients
Who uses Nesbitt Realty management services?
Should you know more about this area?
Our Guide to Real Estate is a free resource for everyone who wants to investigate real estate facts about West Mclean Inventory and neighboring communities. The Guide to Real Estate includes facts about what has sold and what is on the market, as well as a few interesting facts that you may not know. In addition, our Guide spotlights many of the assets of living in West Mclean Inventory. As might be expected, all of this is interesting for buyers and sellers, but property owners and tenants should also find these tools to be very useful.
Landlord Reference
a handy archive for landlords in West Mclean Inventory
- Before you rent out your rental property in West Mclean Inventory
- Collections and evictions
- Communications with the renter
- During the lease term
- End of lease term and what happens when a renter breaks the lease
- How does the rental investor get paid?
- How your rental manager handles the association and your community
- How your property management company handles utilities
- How Nesbitt Realty finds renters
- Insurance matters for landlords using our property management
- How Nesbitt Realty & Management manage keys
- West Mclean Inventory owner responsibilities
- Maintenance, repairs & inspections for your rental property in West Mclean Inventory
- 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 tenants in West Mclean Inventory