Property Managers Should Use Commercial Trust Accounts For Handling Rental Payments and Deposits

August 29, 2012

Property owners don’t just trust commercial property management San Diego with the care of their rental property. They also trust property managers with the handling of their money and their tenants’ money.

Earning that trust is made much easier when the property manager follows careful banking protocols for such business agreements and transactions. 

As a property manager, you should have a commercial trust account set up with your commercial bank. This will ensure that the money kept in the account will be protected from potential seizure in the event of bankruptcy or other issues with separate personal or business accounts. 

The trust account is simply for client money and tenant money. Tenant money includes monthly rental payments and, in some circumstances, security deposits. There should not be any business operating funds coming into or out of the trust account. The checks you use for this account should state that it is a commercial property management San Diego trust account, and the leases should state where and what bank the security deposits are held. 

The security deposits may be kept in the same account as the rental income but if you have many units with the same owner then you should get two accounts: one interest bearing trust account and another trust account for the rental income. If you are dealing with multiple owners that don’t have a lot of properties then a combined account for both rental income and security deposits should be fine.

The general rule of thumb in commercial property management San Diego is to keep at least one copy of everything. That includes keeping copies of all checks, whether carbon or photocopied. Copies of duplicate deposit receipts also should be kept once the funds are deposited.

SOURCE: Alwaysscreen.com

DISCLAIMER: This blog has been curated from an alternate source and is designed for informational purposes to highlight the commercial real estate market.  It solely represents the opinion of the specific blogger and does not necessarily represent the opinion of Pacific Coast Commercial.