Owner Reserve and Funding Repairs

To handle repairs smoothly, we keep an owner reserve on your account and have a clear process for funding larger or unexpected work. This article explains how the reserve works and when we’ll ask you to add funds.

Having funds ready for repairs avoids delays, protects the property from worsening damage, and prevents surprises around your monthly owner draws.

• An owner reserve is a small amount of money we hold in your account to cover routine or urgent expenses (for example, minor repairs or service calls).

• The target reserve amount is set in your management agreement (for example, $500 per property or portfolio).

We use the reserve to pay for:

• Approved maintenance work,

• Invoices that arrive just before a distribution, and

• Smaller unexpected items (within your agreed spending limit).

Reserve funds are still your money; they’re simply held in trust to keep operations smooth.

1. When a Repair Exceeds Available Cash: If a repair estimate exceeds the current reserve balance plus recent or expected rental income, we’ll request an owner contribution.

2. Large or Capital Expenses: For bigger projects (roof work, major plumbing, HVAC replacement, etc.), we’ll present quotes and options. You’ll approve the work and provide additional funds before we proceed, unless the situation is an emergency.

3. After Significant Vacancy or Delinquency: If there’s been a long vacancy or serious non-payment, available funds may be low. So, we may request contributions to restore the reserve and cover required repairs.

1. We’ll send you a summary of the work, estimated costs, and requested contribution amount.

2. You send funds via the approved payment method (often through the owner portal or bank transfer).

3. We apply those funds to the specific repair and keep your reserve at the agreed level where possible.

• If repairs are paid from rent proceeds, your next owner draw may be lower.

• Keeping a healthy reserve reduces the number of times your distribution is significantly impacted by routine repairs.

• Owner Fees Explained – Overview of our management and leasing fees.

• Owner Payments & Statements – How income and expenses show up on your reports.

• How We Handle Maintenance – Our process for responding to and approving work.