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. Conversely, 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 Lake Ridge, 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 rental management. Although the money is in our escrow account, the money belongs to the landlord. 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.
Property 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.
Lake Ridge Property Management Resources
Basics
Basic information regarding rental managment in Lake Ridge.
Getting Started
Learn more about getting started with property management
Find A Tenant
List your property to rent to find a dependable tenant in Lake Ridge fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for property owners?
Cost
An overview of prices of rental management services in Lake Ridge
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 understand more about this community?
Nesbitt Realty's Guide to Real Estate is a free tool for everyone who hopes to learn more about Lake Ridge and neighboring areas. The Guide to Real Estate has facts regarding what has sold and what is on the market, and a few interesting facts that you might not be aware of. And, our Guide highlights many of the aspects of residing in Lake Ridge. Definitely, all of this is interesting for purchasers and sellers, but property owners and renters should also find the facts to be quite sobering.
Landlord Reference
a free reference for property owners in Lake Ridge
- Before you put a renter in your investment in Lake Ridge
- Collections and evictions
- Communications with the tenant
- During tenancy
- End of tenancy and what happens when a tenant 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 tenants
- Insurance matters for property owners using our property management
- How Nesbitt Realty & Management manage keys
- Lake Ridge property owner responsibilities
- Maintenance, repairs & inspections for your rental property in Lake Ridge
- 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 Lake Ridge