Do you know the difference between contingency reserves and operating funds?
Operating funds are monies that our property management and real estate business 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 Fairfax Gateway, 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 escrow to pay for repairs and other incidentals that occur during property 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 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.
Fairfax Gateway Rental Management Resources
Basics
Fundamental info regarding rental managment in Fairfax Gateway.
Getting Started
Learn more about getting started with rental property management
Find A Tenant
List your property to rent to find a reliable renter in Fairfax Gateway fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for real estate investors?
Cost
An overview of prices of property management services in Fairfax Gateway
Vetting
How Nesbitt Realty vets renters for landlords.
Reserves
What is a contingency reserve account?
Territory
Where does Nesbitt Realty manage property?
Clients
Who uses Nesbitt Realty management services?
Should you understand more about our area?
Nesbitt Realty's Guide to Real Estate is a helpful resource for everyone who hopes to review important real estate information about Fairfax Gateway and surrounding areas. The Guide to Real Estate compiles information regarding what has sold and what is for sale, as well as a few interesting facts that you might not be aware of. In addition, our Guide has some elements of residing in Fairfax Gateway. As a matter of course, most of this is interesting for buyers and sellers, but real estate investors and renters will likely also find this information to be very eye-opening.
Landlord Reference
a good archive for rental investors in Fairfax Gateway
- Before you lease out your property in Fairfax Gateway
- Collections and evictions
- Communications with the renter
- During tenancy
- End of lease term and what happens when a tenant breaks the lease
- How does the owner get paid?
- How your rental manager handles the association and your community
- How your rental manager handles utilities
- How Nesbitt finds tenants
- Insurance matters for owners using our rental management
- How Nesbitt Realty & Management manage keys
- Fairfax Gateway landlord responsibilities
- Maintenance, repairs & inspections for your property in Fairfax Gateway
- The move-in inspection
- Property management information form
- Selling a 1031 tax exchange & more
- Starting our management of your rental investment
- When owners don't yet know their new address
- Vetting tenants in Fairfax Gateway