By now you should have determined if you are hiring a Property Manager for your Mexico Real Estate rental. You've interviewed and have chosen a Property Manager that you are confident with. The Mexico Property Manager that you've chosen has sent you the Property Management Agreement (PMA) and you notice a clause that states that you must deposit funds into a Trust Account with the Property Manager and you wonder
what this sum of money is for…
Many Property Management Companies require a specific amount of money deposited into what's referred to as a Trust Account. This amount can be as little as $100 or $1000 and will vary by Management Companies. Most companies I've had experience with require $250-$500.
Mexico Property Management Trust Accounts
Trust accounts can be complicated but the primary details that you should know are:
- Funds are the property of someone other than the Property Manager
- Funds in a trust account cannot be comingled with personal funds of a Property Manager
- Funds in a trust account are used for property repairs, taxes, insurance, utilities, etc.
- Funds in a trust account can earn interest which can sometimes be kept by the Property Manager
- When a Property Manager pays expenses from an Owner's trust account, there must be enough funds in the account to cover the expenses.
- The Property Management Company will/should provide a detailed accounting report outlining how funds have been disbursed.
Trust accounting is not difficult and experienced Mexico Property Management Companies know how to handle other people's money with care and consideration. However, it is your responsibility to insure you check your statements carefully and ask questions if you notice anything that you are unsure about.
Kami Kemp is both a Texas Realtor and Real Estate Broker in Arizona with Prime Properties. She is a member of the Texas Association of Realtors, the National Association of Realtors and National Association of Residential Property Managers. She began her career in Property Management and Leasing in 1990, has served on various education committees through local associations and has taught many Fair Housing compliance and marketing classes throughout her career. www.TOPmexicorealestate.com 512-879-6546
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