Do you know the difference between contingency reserves and operating funds?
Operating funds are monies that our real estate brokerage uses to pay for our business. Operating funds are our money. In contrast, 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 Features, 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 maintenance and other incidentals that occur during property management. Although the money is in our escrow account, the money belongs to the property owner. 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.
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.
Features Property Management Resources
Basics
Elementary info about what management services in Features.
Getting Started
Learn more about getting started with rental property management
Find A Tenant
Market your property to rent to find a great tenant in Features fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for landlords?
Cost
An overview of prices of property management services in Features
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 investments?
Clients
Who uses Nesbitt Realty management services?
Do you need understand more about our community?
Nesbitt Realty's Guide to Real Estate is a handy resource for anyone who needs to learn more about Features and surrounding areas. The Guide to Real Estate includes information regarding what has sold and what is for sale, as well as a few interesting facts that you may not know. Also, our Guide spotlights some assets of life in Features. Naturally, all of this is helpful for purchasers and sellers, but property owners and renters will probably also find the facts to be somewhat eye-opening.
Landlord Reference
a useful reference for property owners in Features
- Before you put a renter in your investment in Features
- Collections and evictions
- Communications with the tenant
- During the lease term
- End of lease term and what happens when a renter breaks the lease
- How does the owner get paid?
- How your property management company handles the association and your community
- How your rental manager handles utilities
- How Nesbitt finds tenants
- Insurance matters for rental investors using our rental management
- How Nesbitt Realty & Management manage keys
- Features property owner responsibilities
- Maintenance, repairs & inspections for your property in Features
- 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 Features