Do you know the difference between contingency reserves and operating funds?
Operating funds are monies that our real estate brokerage uses to fund our business. Operating funds are our money. Nevertheless, 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 Evergreen Farm, 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 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 rental 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 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.
Evergreen Farm Property Management Resources
Basics
Elementary information regarding management services in Evergreen Farm.
Getting Started
Learn more about getting started with property management
Find A Tenant
Market your property to rent to find a dependable tenant in Evergreen Farm fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for property owners?
Cost
A list of prices of rental management in Evergreen Farm
Vetting
How Nesbitt Realty vets tenants 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 need know more about the area?
Our Guide to Real Estate is a helpful tool for everyone who needs to find out more about Evergreen Farm and nearby areas. The Guide to Real Estate compiles data about what has sold and what is on the market, as well as a couple of compelling facts that you might not be aware of. And, our Guide has quite a few of the fundamentals of life in Evergreen Farm. Naturally, all of this is useful for purchasers and sellers, but real estate investors and renters might also find these tools to be somewhat eye-opening.
Landlord Reference
a handy source for landlords in Evergreen Farm
- Before you put a renter in your investment in Evergreen Farm
- Collections and evictions
- Communications with the renter
- 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 property management company handles utilities
- How Nesbitt Realty & Management finds renters
- Insurance matters for property owners using our rental management
- How Nesbitt Realty & Management manage keys
- Evergreen Farm property owner responsibilities
- Maintenance, repairs & inspections for your property in Evergreen Farm
- 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 Evergreen Farm