How to Tap Larger Firms to Grow Your Foreclosure Cleanup Business
Where to Find Subcontracting Work for Your Foreclosure Cleaning Business & REO Trash Out Business
Subcontracting is a big industry, and, as a foreclosure cleaning business, if you're not tapping into it, you're missing a big piece of the money pie.Subcontracting is a big industry, and, as a foreclosure clean-up business, if you're not tapping into it, you're missing a big piece of the money pie.
Foreclosure cleanup companies handle everything from boarding windows and doors, to trash outs, to lock changing, yard work, minor repairs, tarping roofs and more. Larger Management and Marketing (M&M) Contractors market and manage single-family properties via HUD. The M&M Contractors often contract work out to larger property preservation companies.
These larger property preservation companies are often assigned properties in various regions of the country. More often than not, they are responsible for properties in more than one state at a time, via their various offices, departments and divisions. The property preservation companies need smaller subcontractors to help them handle the business, especially now.
According to RealtyTrac, an Internet company that tracks and reports foreclosure data, one in every 355 homes in the
United States had, at minimum, one filing during the month of July of this year.
That's an increase of an astounding 32% from July of last year. The field is wide open for smaller foreclosure cleanup companies.
But, many smaller foreclosure cleanup companies miss the boat because they are either not set up formally (properly
licensed and insured) to handle formal subcontracting work, or, they don't
actively seek out subcontracting work from these larger companies.
To find subcontracting work, smaller companies can do several things. Here are some suggestions:
1) Go to HUD's website to find the larger M&M contractors and contact them directly seeking contact information for their
property preservation preferred companies: "Hi, I'm Jane Doe from ABC
Company. I am a foreclosure cleanup company located in XYZ City and I'd like to offer my services on a subcontracting level. To whom
should I direct my correspondence?"
2) Use Internet search engines like Google and search terms like the following, always including "property preservation" in
the search terms being used: subcontracting opportunities for property
preservation companies, property preservation vendor application, property preservation work, property preservation contracts, etc. These
terms should land you on several inks. Ignore the smaller companies that are
trying to get work like your company, and shoot for the larger property preservation companies with several offices.
3) Research and contact banks with REO departments in your area and first offer your services to them directly. Then ask
for information about their preferred primary vendors, explaining you'd like to
offer your company's services to help them service the bank's REO listings in a timely manner.
4) Visit some actual foreclosures in your area and peek at the sticker in the window, on the door, or in the home to see
who the larger property preservation company is handling that home. They
usually have brightly colored stickers holding their contact info.
Call them, email them, write them, visit them, letting them know you have visited one of their homes and want to offer your
company's foreclosure cleanup services to their company on a
subcontracting basis. (To find foreclosures in your area, simply go to your county's MLS system online to find properties, go to websites like
Bid Select, or search foreclosures and your city online via the search engines).
Subcontracting opportunities are out there in numbers for smaller foreclosure cleanup companies. The trick is to formalize your business with the proper license and insurance (and get a Tax ID for your company via the IRS' website!) so you can apply for these vendor opportunities to grow your foreclosure clean-up business.
Good luck with your foreclosure clean-up business!
NOTE: Throughout the internet and in real estate industry literature, you may see the terms or names mortgage field services, property preservation business, foreclosure cleanup, foreclosure cleaning, foreclosure clean-outs, foreclosure clean, clean foreclosures, cleaning foreclosures, REO trashout, REO trashouts, field asset services, property field services, field service, and field services used interchangeable. The main thing to remember is foreclosure cleaning and foreclosure cleanup generally refer to smaller entities; while property preservation generally refers to larger entities/organizations.