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, 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 Seven Oaks, 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 property owners.
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. 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.
Seven Oaks Property Management Resources
Basics
Basic information regarding rental managment in Seven Oaks.
Getting Started
Learn more about getting started with property management
Find A Tenant
Market your property to rent to find a great renter in Seven Oaks fast.
Accounting
How does Nesbitt Realty keep track of income and expenses for landlords?
Cost
A list of prices of rental management services in Seven Oaks
Vetting
How Nesbitt Realty checks the backgrounds of 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?
Should you know more about this area?
Our Guide to Real Estate is a handy resource for everyone who needs to investigate real estate facts about Seven Oaks and neighboring areas. The Guide to Real Estate has facts regarding what has sold and what is for sale, and some shocking facts that you might not know. Also, our Guide has many of the elements of life in Seven Oaks. Definitely, all of this is interesting for buyers and sellers, but real estate investors and renters may also find the facts to be very enlightening.
Landlord Reference
a handy archive for landlords in Seven Oaks
- Before you move a tenant into your investment in Seven Oaks
- 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 owner 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 landlords using our rental management
- How Nesbitt Realty & Management manage keys
- Seven Oaks landlord responsibilities
- Maintenance, repairs & inspections for your property in Seven Oaks
- 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 Seven Oaks