Are you looking to invest in a property in Charlotte, North Carolina? If so, you've made a wise decision!

A report showed that an average of 113 people moved to Charlotte each day between July 2021 and July 2022! One can only expect this number to have increased since then.

But before you start seeking tenants, you must learn the rules of owner disbursements. This is a crucial aspect of managing your landlord finances.

Here's what you need to know!

How Owner Disbursements Work

Owner disbursements refer to all money received by a landlord from a third party. This third party can include a property manager who collects payments on your behalf.

It's your responsibility to differentiate between your income and expenses. For example, let's presume you earn $1,000 per month via an owner disbursement. If you charge $700 as a rent payment, then $300 is your expenses.

You'll have to keep records of how much your profit is each month and how much your expenses are. For detailed guidance on managing rental property accounting, visit https://www.carolinaspropertymanagement.com/blog/3-tips-for-rental-property-accounting-in-charlotte-north-carolina

Examples of Owner Disbursements

Now let's break down the different payment types that fall under the category of owner disbursements.

The main payment is, of course, your rent payments. You can charge what you wish to your tenant. However, make sure you charge a reasonable amount if you want to ensure lease renewals. Security deposits are also part of owner disbursements.

Regular expenses are also included in owner disbursements. This includes bills, community fees, regular service fees, etc.

It could also include additional fees for emergency services. This can include repair costs, for instance. Other additional fees can include pet fees and penalties for late rent payments.

Best Practices

Let's end with a few best practices of what to do when you receive your owner disbursements. You should first open a separate bank account to hold your owner disbursements. This ensures that you don't mix it up with your personal finances.

Many real estate investors use their profits to reinvest back into their property. Or you can consider investing in new properties with your profits.

You should also keep aside some of your profits for emergency expenses. There might be damages or other expenses related to your property that you'll be responsible for.

For example, let's suppose an appliance isn't working, and it isn't due to the tenant's negligence. You'll have to pay to repair or buy a new appliance for them. You can use your owner disbursements to help cover these costs.

Property taxes can also be paid with your owner disbursements. Your accountant can advise you on how to best manage your owner disbursements for long-term success.

Open Your Doors

Once you understand how owner disbursements work and how to manage your money, you can start your journey as a landlord!

While being a landlord is a great experience, it also comes with its challenges. If you'd like to find a helping hand, then you need to speak to a property manager.

The next step is for you to reach out to Charlotte's best property management company, serving the needs of the area since 2008. Carolina Property Management is here to help, so contact us today!

Click Here to learn more about how property managers can assist you.