Overview
If you charge management fees to manage your properties, DoorLoop can calculate the fees automatically and create bills on your behalf. You can either configure the same management fee settings for all of your properties, or a property can have unique fee settings.
Note: Management Fees are not available to Starter Plans. Consider upgrading to the Pro or Premium Plans to access this feature.
The Steps
Configure Company Default Management Fee Settings
Company management fee settings allow you to configure a default rate for your properties to use. If you have unique management fee rates on each of your properties, skip to the property management fee settings section.
The first step in setting up your Company Management Fees is to click Settings on the main menu. Then scroll down to the Property Settings section, and click on the Management Fees button.
In the Payee section, choose the appropriate vendor (likely your own property management company) in the Select Vendor dropdown menu.
If you haven’t created the vendor in DoorLoop, you can cancel out of the settings window and use the + Create New button in the upper left corner of the screen to add the vendor before configuring management fees. Read this article on how to add a vendor.
In the Management Fees section, toggle on the appropriate fees. You can pick more than one if necessary. We’ll explain the different options for you:
Add a fee based on payments received (Cash Basis)
If your fee is based on the actual money you collect from tenants, pick this method. This will calculate the fee as a percentage of payments received for the revenue accounts you choose.
Select the Base Category for the management fee and enter the Fee percentage. Choose the Expense Cetegory for the fee, such as the default Management Fees expense account.
Use the Add another category link to charge a fee on another base revenue account.
Add a fee based on charges posted (Accrual Basis)
If your fee is based on the charges to the tenants, regardless of their payments, pick this method. This will calculate the fee as a percentage of charges created on leases for the revenue accounts you choose.
Select the Base Category for the management fee and enter the Fee percentage. Choose the Expense Category for the fee, such as the default Management Fees expense account.
Use the Add another category link to charge a fee on another base revenue account.
Flat fee
If you charge a set, non-percentage fee every month, pick this option.
Enter the Fee amount and choose the Expense Category for the fee, such as the default Management Fees expense account.
Use the Add another fee link to add additional fees if necessary. You may need to do this if you charge another fee to a different expense account.
Minimum fee
This option ensures that your management fee will at least be the amount entered here. Once the total of your other fees exceed this amount, DoorLoop uses that total instead.
Enter the Fee amount and choose the Expense Category for the fee, such as the default Management Fees expense account.
In the Management Payout Categories section, toggle on Payout categories if there is an account in your chart of accounts for which your management company keeps the total amount, passing nothing on to the owner. This means that these accounts will not show up as revenue on the Profit and Loss report or the Owner Statement.
For example, you might have an agreement where you keep all late fees and rental application fees, or you might keep tenant payments related to repairs and cleaning which you use to pay other vendors.
Use the dropdown menu to select the account and use the Add another category link if you need to add other accounts.
Click Save to finish.
Configure Property-Level Management Fee Settings
To use the management fees feature for your properties, you will need to turn on management fees for each property you will create management fees for.
The first step in setting up your Property Management Fee settings is to click Rentals on the main menu and then click Properties. Click on the property you want to turn on management fees for.
Click on the Settings tab and then on the Management Fees button.
Toggle on Enable management fee for this property and choose whether or not you want to use the company default or specify a new management fee structure.
If you want to specify a unique management fee structure, use the same instructions above for Configure Company Management Fee Settings.
Click Save when you are finished.
Things to Consider
You can create the management fee bills first, and then pay them later.
In DoorLoop vendor bills are a two-step process, so you can wait to pay a bill if you want. For example, you create your management fee bill to show that you, the vendor, are owed money. When you actually collect the money, you record the bill payment to show it has been paid.
Record management fees after receiving revenue from your tenants and before you record owner distributions.
If you deduct your management fees from property revenue before sending the remaining income to the owner, go ahead and create the management fee bill payments right after you create the bills.
The bill payment reduces the funds available to distribute to your owner by the amount of your management fees. This way, when you record the owner distribution, you won't accidentally distribute the full revenue amount because you forgot to record your management fee bill payment.
If the owner of the property receives rent payments directly, record the management fee bill first, then record the payment after the owner pays you.
If the tenant payments go directly into the bank accounts of the property owners, you can record the management fee bill payments when the owner actually pays you for the bills you send them.
Fix management fee bills that were created incorrectly or are missing information.
If you created management fees with incomplete data, you will need to delete the bills and redo the management fee process. Make sure all lease transactions are accurate before redoing your management fees!
There are multiple ways to find and delete bills and bill payments, but we recommend going to Reports and choosing the Transactions List report in the Accounting section. Here you can filter the transactions by date, the type of transaction, and vendor to help you narrow down your transaction list to find the bills you need to delete. Since your property management company is the vendor, filtering by the correct time period and yourself as the vendor will likely suffice.
If you also paid the bills, you will need to find and delete the Bill Payments before deleting the Bills. Delete these by clicking on each line item in the report and choosing Delete in the lower left corner of the screen.
After you’ve deleted the bill payments and bills, you will need to redo the Create and Pay Management Fee Bills process. However, on Step 2, you will need to make sure the correct date range is selected, and change the Billed Properties dropdown to Include Already Billed. This way you can see the properties which previously had management fees created for them, and you can select the properties you need to recreate management fees for before continuing the process.
Next Steps
Now that you've set up your management fees, the next step is to create and pay your Management Fees. You can learn how to do that here: Create and Pay Management Fee Bills.