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. Still, 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 Hawthorne Village, 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 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 real estate investor. If 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.
Hawthorne Village Property Management Resources
Basics
Fundamental information about what property management in Hawthorne Village.
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 Hawthorne Village fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for real estate investors?
Cost
A list of prices of rental management in Hawthorne Village
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?
Do you want understand more about our community?
Our Guide to Real Estate is a helpful resource for anyone who needs to learn more about Hawthorne Village and nearby communities. The Guide to Real Estate compiles information regarding what has sold and what is on the market, and some interesting facts that you might not know. And, our Guide features quite a few of the benefits of life in Hawthorne Village. Of course, most of this is helpful for buyers and sellers, but landlords and renters may also find this data to be very informative.
Landlord Reference
a useful reference for rental investors in Hawthorne Village
- Before you rent out your investment in Hawthorne Village
- Collections and evictions
- Communications with the tenant
- During the lease term
- End of lease term and what happens when a tenant breaks the lease
- How does the landlord get paid?
- How your rental manager handles the association and your community
- How your management company handles utilities
- How Nesbitt Realty & Management finds renters
- Insurance matters for rental investors using our property management
- How Nesbitt Realty & Management manage keys
- Hawthorne Village rental investor responsibilities
- Maintenance, repairs & inspections for your property in Hawthorne Village
- 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 Hawthorne Village