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. 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 Sherbrooke, 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 real estate investors.
Contingency reserve is a special type of escrow.
A contingency reserve account is money that is held in escrow 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 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.
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.
Sherbrooke Rental Management Resources
Basics
Fundamental information about what management services in Sherbrooke.
Getting Started
Learn more about getting started with property management
Find A Tenant
List your property to rent to find a reliable renter in Sherbrooke fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for real estate investors?
Cost
A breakdown of prices of property management services in Sherbrooke
Vetting
How Nesbitt Realty vets renters for our clients.
Reserves
What is a contingency reserve account?
Territory
Where does Nesbitt Realty manage rentals?
Clients
Who uses Nesbitt Realty management services?
Do you want understand more about this local real estate market?
Nesbitt Realty's Guide to Real Estate is a helpful resource for everyone who needs to find out more about Sherbrooke and neighboring areas. The Guide to Real Estate provides facts regarding what has sold and what is on the market, and some surprising facts that you may not know. Not to mention, our Guide spotlights quite a few of the aspects of living in Sherbrooke. Definitely, all of this is useful for buyers and sellers, but real estate investors and tenants will probably also find these tools to be quite edifying.
Landlord Reference
a good archive for property owners in Sherbrooke
- Before you put a renter in your property in Sherbrooke
- 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 landlord get paid?
- How your property management company handles the association and your community
- How your management company handles utilities
- How Nesbitt finds tenants
- Insurance matters for property owners using our property management
- How Nesbitt Realty & Management manage keys
- Sherbrooke owner responsibilities
- Maintenance, repairs & inspections for your rental investment in Sherbrooke
- 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 Sherbrooke