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 fund our business. Operating funds are our money. But even so, 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 Greenwood 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 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.
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.
Greenwood Farm Property Management Resources
Basics
Fundamental info about what management services in Greenwood Farm.
Getting Started
Learn more about getting started with property management
Find A Tenant
List your property to rent to find a reliable renter in Greenwood Farm fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for real estate investors?
Cost
A list of fees associated with rental management in Greenwood Farm
Vetting
How Nesbitt Realty checks the backgrounds of tenants 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 the area?
Nesbitt Realty's Guide to Real Estate is a handy resource for anyone who needs to review important real estate information about Greenwood Farm and nearby communities. The Guide to Real Estate includes facts regarding what has sold and what is currently listed, and some surprising facts that you may not know. In addition, our Guide has some aspects of living in Greenwood Farm. Definitely, all of this is helpful for purchasers and sellers, but real estate investors and tenants should also find these resources to be quite eye-opening.
Landlord Reference
a handy archive for landlords in Greenwood Farm
- Before you lease out your rental property in Greenwood Farm
- Collections and evictions
- Communications with the renter
- During tenancy
- 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 tenants
- Insurance matters for owners using our rental management
- How Nesbitt Realty & Management manage keys
- Greenwood Farm landlord responsibilities
- Maintenance, repairs & inspections for your rental investment in Greenwood Farm
- The move-in inspection
- Property management information form
- Selling a 1031 tax exchange & more
- Starting our management of your rental investment
- When landlords don't yet know their new address
- Vetting renters in Greenwood Farm