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Q&A With Les Tyler: "Cleaning Up Meth Houses?"

2011-04-23T14:58:00Z

Hi Everyone!

Time for another great Q&A posting... We recently received this question from Kevin M:

"Hi Les,

First, let me say that I love your program - lots of good information, and probably the best out there online. I have a question for you: we've been contacted to clean up a meth lab house in Missouri, but I'm not sure we should do it. Have you guys ever cleaned anything like this? Can you give me your thoughts on this? " Kevin M.

Here's My Reply:

Hi Kevin,

I'm so glad to hear you're enjoying the Foreclosure Cleanup Cash program! And thanks for the great question. While we have cleaned up just about everything, we have not, and do not clean up properties used to manufacture meth.

The reason we don't clean these types of properties is because doing so is a dangerous procedure and requires employees to be exceptionally trained in the safety skills necessary to remove the hazardous subtances left behind in a former meth house.

Photo by Adam Brimer/News Sentinel

When a property is used as a meth lab, the entire structure of the house (walls, floors, furniture, interior fixtures) absorbs contaminants from the process and will continue to give off fumes, sometimes indefinitely. So the proper personal protection equipment (PPE) required, along with training of handling hazardous materials (and the subsequent disposal of these materials) generally is above and beyond the scope of a foreclosure cleanup company.

We have on occasion had to refer properties to be cleaned by hazmat trained professionals (environmental companies specifically trained in biological and chemical-hazardous materials removal), such as in the case of a suicide or another trajedy in the property. I recommend that you locate a few of these types of firms in your area and refer them the work if you encounter an opportunity to clean a property that involves hazardous materials clean up.

There's a great article from the Knox News about Eco-Ethics, a meth cleanup contractor in Tennessee. You can check out the article heret A Dirty, Dangerous Job Cleaning Up Meth Labs

Also, If you are interested in learning more about meth house cleanup, the University of Tennessee offers a "Clandestine Methamphetamine Lab Decontamination Contractor Class" (24 Hours)

Participants that successfully complete the training and State of Tennessee prerequisites will meet the training requirements to become a CML Decontamination Contractor and certified CML Hygienist.

Topics covered include

Obtaining a “Certificate of Cleanliness”
Tennessee-specific sampling requirements
Tennessee-specific decontamination requirements
Manufacturing methods
Toxicology
Requirements for assessing CMLs
Property cleaning methods
Health and safety program requirements
Personal protective equipment
Site assessments
Work plan development
Materials disposal requirements

To Learn More about Cleaning up Foreclosed Properties for Profit, You Can Check out Our Foreclosure Cleanup Cash Program by clicking Below:

"How Do I Prevent Getting Ripped Off by Customers?"

2011-03-23T15:43:00Z

Hi Everyone!

Firstly, let me say thank you to everyone who has sent me questions and I want you all to know that I am doing my very, very best to get back to each and every one of you! Please be patient as my inbox fills up quickly and I can only get back to so many of you at a time.

In the meantime, I'm going to try and post more common questions and my answers on the blog as a resource for some of the questions you may have.

Here's a question we recently received from Jim S.
"I have a question that is very important to me and my family. What precautions do you take to not get ripped off after you’ve done one or several jobs? I used to own a construction company and when I dealt with individuals I always got paid, but when I worked as a sub contractor I was ripped off due to them not paying. I take pride in my work and always did more than was on the bid. Let me know your thoughts on this."

Great question! Here's my reply:

Well I sure hear you about construction clients not paying - this was exactly what happened to us when we were doing construction cleaning for GCs and builders that ended up going out of business without paying any of their subs! Really frustrating, especially when we weren't able to lien the property since we didn't actually "install" anything.

This is actually one of the main reasons we started doing more of the foreclosure cleanup/property preservation services and eventually moved away from doing work in the construction industry.

One thing that we'll often do when working for a new or smaller asset management company is to ask THEM for references from their other subs. They want us to be "prequalified" and so we've learned to turn around and "prequalify" them as customers in the same way. We check at their payment status for at least two of their other subcontractors...

We ask them things like, "Do they pay on time?", "what is their payment schedule like? 30 days? 60 days?", "Do they treat you fairly and pay the full invoice amount?" You can get a pretty good idea about the probability you'll be paid by making a few of these calls.

Another good idea is to let them know upfront that you'll do a maximum of X jobs before recieving your first payment check (i.e. 3 jobs, for example). Just let them know that it's your policy with new clients to do a maximum of X jobs or $XXX worth of work (say, $2500 or whatever you're comfortable with) prior to your first payment. Afterwards you can lift the constraints if you feel comfortable with their payment history.

A third thing you can do is spread your work over a few different clients so you don't "have all of your eggs in one basket". That way, if one customer doesn't pay you, at least the revenue from another paying customer can help to offset this expense.

Right now we're at the point where we simply don't do work for clients that don't pay within 30 days. We've learned the hard way that it's worth only doing work for good quality clients - a poor quality/non-paying customer can absolutly ruin a small firm starting out and it's not worth going out on a limb for firms that aren't going to pay you. The work we do is back-breaking, dirty, and stinky ... and that's why we charge a premium for services and only work for companies that appreciate an honest, hard-working subcontractor by paying them in full and on time!

More great Q & A s coming soon!

In the meantime, Happy Trashing!!

Les Tyler
www.ForeclosureCleanupCash.com

Business Plan Template Now Available - HALF PRICE!

2011-03-23T15:40:00Z

Get Your Fully Customizable 2011 Business Plan Template Now!

Hi Everyone!

Well, we've had such an overwhelming positive response to the Foreclosure Cleanup Cash program that our customers keep asking us for more resources to use to help them with their foreclosure cleanup and property preservation company. So... here it is!

A Business Plan is an absolutely essential part of starting and running a successful Foreclosure Cleanup or Property Preservation company; your plan will tell you where you want to go, and how you're going to get there. As the old saying goes, "if you fail to plan, you plan to fail!"

To celebrate the New Year, we're offering the Foreclosure Cleanup / Property Preservation Business Plan Template for ONLY $19 - that's more than 50% off! but only for a limited time!

After this date, we'll be selling the template for the normal price of $39 (and anyone who knows how much business plans cost (upwards of $1000+!) knows that $19 is a smokin' deal for a customizable business plan specifically designed for service providers in the foreclosure cleanup / property preservation industry!)

HERE'S WHAT'S IN THE BUSINESS PLAN TEMPLATE:

- 40+ PAGES of pure business plan content, with clear and simple instructions for customization

- Industry research and growth analysis for the 2011 foreclosure cleanup market

- All of the components of a professional plan, including Executive Summary, Company Description, Service Plan, Vision & Mission Statement, Industry Overview, Market Analysis, Competitive Analysis, Marketing Plan, Operations Plan, Organizational Plan, Financial Plan, Growth Plan

- Great ideas for growing your business

- Helpful hints and tips to walk you through customizing the plan for your organization

- In Microsoft Word document - easy to customize as you wish

- See the above image for the full Table of Contents

- Available as an instant electronic download - no waiting for materials in the mail!

HURRY! Get Your Fully Customizable 2011 Business Plan Template Now at the special introductory price of only $19 before the price goes up! (Click on the Add to Cart Button to Get Instant Download Access Delivered Right To Your Inbox!)

More Q&A posts coming soon so stay tuned!

Happy Trashing!
Les Tyler

Use Caution When Entering Properties

2010-10-11T18:59:58Z

Hi Everyone,

I just came across an article that I think all property preservation service providers should read (and check it out, they also cited my YouTube video on our website at www.ForeclosureCleanupCash.com!):

Banks Accused of Illegally Breaking Into Homes Facing Foreclosure . Once you've read the article, look for my comments in the comment section.

In this article, Safeguard (a large property preservation company) essentially broke into a woman's home while she was still living there. The kicker?

The house hadn't been foreclosed on!!!

Talk about an error in judgement on behalf of the preservation company! The article cites another incident in which people returned home after a few days away to find their locks changed and home ransacked, presumably done also another property preservation company.

Please, PLEASE take the utmost care when determining occupancy when you approach a property.

Here's an ACTUAL COMMENT from someone responding to the article I cited above:

"Wonder how this contractor would feel if he was met with a shotgun on the other side of the door.Better start thinking before they jump the gun. How was this lady to know it wasn't just a random break in?She'd be well within her rights to defend herself if she felt her life was in danger." sarnie_c 1:59 PM

WOW! This is scary!

The fact of the matter is that people are angry at the banks, and angry about losing their homes. You need to be very, very careful when approaching a property you have been asked to bid on or to clean out.

Here are safety tips:

Don't go alone: This is true especially if you're a woman. Sorry, I know this stinks because I always have to bring someone along too, but safety is always the first priority. Not only will you get the job done faster if you're out on a bid and bring someone else, you have both an extra set of eyes and hands as well as a witness in case anything happens.

Look for signs of occupancy before entering. Common indicators of a vacant property include overgrown yards, disheveled or empty interiors when looking inside through a window, etc. You should also listen for the sounds of pets inside, although sadly, sometimes people will leave their pets inside the foreclosed home (I know, unreal). If the inside clearly looks like someone still lives there, you must re-verify occupancy with the bank and let them know you think someone might still be there. It's the bank's job to evict them, not yours.

Document, Document, DOCUMENT! You may be in a situation where you have to prove that you were diligent in determining that the house was vacant. Photos certainly help prove a lot (overgrown yard, disheveled interior, rotting food in the fridge), as will your notes that indicate you followed proper procedure (properly opening the door - no smashing windows!, verbally annoucing your arrival, record-keeping of the items removed, etc.)

Above all else, do not get into a confrontation with a homeowner, neighbor or other person on or near the property. You job is to clean out the property, not to evict people or to represent the bank. I always tell people, "I'm just the cleaning company trying to do my job. I'm sorry, I don't know anything or have any other information for you". If they become aggressive, get outta there! Notify the asset manager and let them know that THEY have to take care of the situation before you'll return.

Once you're arrived at a property, it's your job to clean out the property and provide preservation services, but you must do your job with integrity and respect. Do whatever it takes to make sure the property really is vacant, and that if you find something you think is really important to someone (i.e. SSN card, Drivers License, etc.) do your best to return it to the issuing authority or to get it back to it's lawful owner.

Read the article from ABC News, check out my comments (of course I had to defended us and let them know that most of us preservation companies are honest, hard-working and family owned and operated service providers), and then let me know what you think.

Happy (and safe) Trashing!

Les Tyler
Author, Foreclosure Cleanup Cash
www.ForeclosureCleanupCash.com

Easy Way to Upload Bulk BEFORE & AFTER Photos - FREE Photo Template

2010-04-20T20:25:00Z

Hi Everyone!

I've been getting some emails about an easier way to send the BEFORE & AFTER photos to Asset Managers for foreclosure cleanup bids and invoicing.

Normally, asset managers/realtors want to see at least 50 "before" photos and 50 "after" photos in order to assess the property and the completion of the preservation job. If you've been trying to upload each photo one-at-a-time, you've probably experienced the frustration of photos that are too large, won't send, and cause you to have to email your contact person ten different times...

What a pain! Nevermind a time-waster!

Since time equals money in this business, you want to make sure you are as efficient as possible in managing your time - and this includes the time you spend driving to a property to take photos, driving back to the office to upload them, and then editing/emailing them to the Asset Manager or Realtor (twice, by-the-way - once to bid the job, once when the job is complete).

Over the years, we've developed this simple strategy for 'dropping in' photos into a cool, easy to use Word Template. No more uploading individual photos - you can get it all done in one shot and then simply PDF and email the file once to your property contact.

Seriously, this template has saved us HOURS of work! You can get a copy of your own template for FREE when you sign up for our VIP Newsletter at www.ForeclosureCleanupCash.com

Here's a video showing you how to make the most of this easy-to-use template:

Trust me, it will make your life a whole lot easier, and your foreclosure cleanup / property preservation business a whole lot more profitable.

Enjoy!

Happy Trashing!

Les Tyler
www.ForeclosureCleanupCash.com

FREE Customizable Marketing Flyer

2010-02-23T23:18:00Z

Hi Everyone!

We've posted a FREE Customizable Marketing Flyer for your foreclosure cleanup / property preservation company on our website - available when you sign up for our VIP Newsletter (top right hand side of the main page: www.ForeclosureCleanupCash.com)

Once you sign up, you'll receive the link to immediately download the flyer.

Simply fill in your company information, print, and start handing out to potential customers to start getting more jobs! Remember, the key to growing your business is marketing, marketing, marketing - you can't get the jobs if Realtors, Investors, Asset Management Companies and other potential customers don't know you exist!

Enjoy!
Les Tyler
www.ForeclosureCleanupCash.com

How to Start a Foreclosure Cleanup Company

2009-06-22T23:40:00Z

Hi Everyone;

Well, firstly, let me apologize for being so tardy with my second blogsegment on staying safe on the job... I've been having a wonderful timechatting with you all by email but as a result I've been neglecting our bloghere!

In fact, one of the reasons I'm a bit behind is because I find I'manswering lots of emails on how to start a foreclosure cleanup company (or howto start a property preservation company - I'll explain the difference betweenthe two in a minute).

So, what I've decided to do is take a short break from the safety segment(which is still very important, by the way!!!!) and write an entry on how toget started in the foreclosure cleanup industry so that I can help thoseentrepreneurs out there who want to get into REO field services.

How to Start a Foreclosure Cleanup Business

(or How to Start a Property Preservation Business)

A new article on June 3, 2009 from MSN Money writer Michael Brushindicates that there is a third wave of foreclosures still to come from primeborrowers (i.e. those previously "safe-borrowers" with sound creditand fixed-rate mortgages) as a result of job losses thanks to the worseningeconomy ("Coming: A 3^rd Wave of Foreclosures").

The article states that "In the first quarter, the percentage of these borrowers who werebehind on their mortgages or in foreclosure had doubled from a year earlier, tonearly 6%" and goes on to say that "Credit SuisseanalystRod Dubitsky predicted last week that 8.1million mortgages, or 16% of all mortgages, will go into foreclosure over thenext four years. A weak economy, continued declines in home prices andrising delinquencies among prime borrowers all but ensure that foreclosures"will march steadily higher," he says." To read the fullarticle, go HERE)

(One man's garbage is another's $1500 paycheck!)

Mmmm... notsuch great news for the economy, but good news indeed for entrepreneursinterested in starting a foreclosure cleanup business to clean and repairforeclosed homes for the banks.

To put this inperspective, this means that there will be over 2 million foreclosures a yearand more than $2,025,000,000 up forgrabs in money that will be spent on cleaning up these foreclosed properties (sincethe average bill is $1000+ to clean up one of these properties).

Let's take alook at how you can position yourself to capitalize on this coming trend:

Set Up Your Company Properly

If you want tobe hired for cleanup or preservation work, you'll need to operate your businessas a professional company. The good news is that you can set up abusiness quickly and inexpensively, and usually on your own. Many peopledecide to set up an LLC (Limited Liability Company) because of howquickly and easily it can be done but you’ll want to check with your accountantor other business professional to select the type of business entity that’sright for your personal situation.

If you dodecide to start an LLC, you can usually find all of the documents you needonline from your state’s government website. Usually the branch you’re looking for will be called the “IndustrialCommission” or “Corporation Commission” or similar. Try typing in “start a business + ______(your state)”. Anything ending in “.gov”is usually a good place to start as it indicates a government site.

Once yourbusiness is set up, you’ll need an Employer Identification Number (EIN),which is like a SSN for your business. You can register for one online HERE

As soon as youhave your EIN (which you can usually get immediately online), you can open up abusiness bank account for your company. This step is very, very important. In the excitement of things, many people get caught up in the day-to-daydealings of running a business and use their personal accounts to pay forbusiness expenses. Not only does thispresent an accounting nightmare at the end of the year (trust me – I havepersonal experience on this one!), but it could present problems for you withthe IRS if you don’t keep your personal and business finances separate.

Once youlegally set up your business, you may be required to register your businesswith your county or city in order to get a business license to operate. You can start by calling City Hall or theOffice of the County Clerk to inquire as to whether or not you need acity/county/state business license and if so, how to get one.

So torecap:

Legally set up your business
Get your EIN # and set up a business bank account
Apply for a business license
If you want to do preservation work, determine whether or not you need a contractors’ license (for more information, take a look at our blog on this topic below. We also offer a full list of each state’s contractors’ association in the Foreclosure Cleanup Cash Program – www.ForeclosureCleanupCash.com )

Get Insurance

You absolutely must have a CommercialLiability Insurance policy and Workers’ Compensation Insurance in order to run your business.

Not only is insuranceessential for protecting yourself from liability and protecting those that workfor you in the event of a work-related injury, but many asset managementcompanies will not do business with you if you do not meet their minimuminsurance requirements.

Insurance will likely be oneof your largest start-up costs, however, most insurance companies allow you topay the premium on a monthly (rather than yearly) basis, which definitely makesthis expense more affordable.

General LiabilityInsurance policies can cover thefollowing: bodily injury, property damage, contractual liability, personal andadvertising injury, professional liability (also known as Errors &Omissions (E&O) insurance, this coverage protects you and your businessfrom litigation caused by charges of professional neglect or failure to performyour professional duties), hired auto and non-auto liability and umbrella liability.

You’ll want to speakdirectly with your insurance agent to get a better idea of the extent of thecoverage provided by their particular policy and one that is best suited foryour individual needs

Workers’ CompensationInsurance is required in most stateswhen you have W2 employees, and some states also require your insurance tocover your 1099 contractors also. Workers’ Compensation (“Workers’ Comp”) covers your employees' medicaland disability expenses related to work-related illness and on-the-jobinjuries.

In the states where you arenot required to cover your 1099 contractors you would need them to provideproof that they carry their own Workers’ Compensation insurance. Although tempting to shift the financialburden of maintaining a policy onto your 1099 contractors, in all reality, youare probably better off to take on the cost of all staff Workers’ Compensation(all W2 employees and 1099 contractors). The reason is that it’s difficult to find only independent contractorsthat have their own policy. In addition,this industry has such high turnover that if you put this restriction on yourindependent contractors, you’ll waste valuable time and lost revenues trying tofind replacements in a hurry.

Here’s a great tip:sometimes you can get “pay-as-you-go” insurance where your workers’compensation insurance premiums are based on your actual payroll, rather thanan estimated amount. This is great forcompanies that are just starting out or have a fluctuating workload. Type in “pay as you go workers comp” into asearch engine for results in your area.

As a second tip, we’ve usedFarmers Insurance for years and have always had excellent customer service andgreat rates. Just Google “FarmersInsurance” for an agent in your area.

Foreclosure Cleanup v.s. PropertyPreservation Services

As the name suggests as aForeclosure Cleanup Company, you’ll be cleaning out all of the junk in thehouse (also called a “trashout or a “junk out”), as well as cleaning theinterior of the home. You may also berequired to remove vehicles on the property. Usually foreclosure cleanup companies are also responsible for doing abasic landscape cleanup which includes hauling out any junk from the front/backyards, cutting the grass and trimming trees/bushes.

Cleaning up the property isthe extent of services offered by a Foreclosure Cleanup Company, whereas aProperty Preservation Company is also involved in the “securing” of theproperty and the “preserving” of the property.

Here are some of theservices that a preservation company may offer (note that a PropertyPreservation Company will generally also offer cleanup services):

Securing the Property

Initial vacant property inspection
Lock changes
Boarding of windows and doors
Temporary roof repair
Securing swimming pools

Preserving the Property

Exterior Debris removal
Abandoned vehicle removal (cars, boats, etc.)
Interior Debris removal (junk-out)
Hazardous waste removal
Interior cleaning services including carpet cleaning
Window washing/graffiti removal
Window replacement
Pool services (draining, acid washing, maintaining, etc.)
Pest control services
Yard maintenance/landscaping
Snow removal
Winterization
Gutter cleaning
Pressure washing
Carpet removal & replacement
Tile/Floor repairs
Painting
Sheetrock/drywall repairs
Carpentry repairs
Plumbing fixtures repairs & replacements
Fire & mold remediation
Fence repair

Here are a few things toconsider when determining the extent of the services you want to offer:

A Contractors’ License isgenerally not required for Foreclosure Cleanup Company but is likely requiredfor preservation companies doing work over a certain dollar value (usually $500- $1000+). Sometimes this license can beobtained by attending a course and successfully passing a test whereas otherstates require previous, verifiable industry experience.

The insurance premiums tend to be higher on companies that offer preservationservices as they are considered to be a “general contractor”. However, the revenue potential is much higheras preservation services tend to run from a few thousand dollars upwardsinstead of $800 - $1500 for each cleanout.

Usually what people do isstart out initially offering just the foreclosure cleanup services and thenwhen things pick up, they’ll add preservation items to the list of servicesthey offer. This let’s them get theirfoot in the door without having to spend a whole lot of money upfront whensetting up their company.

Source the Right Equipment & Tools

The greatthing about starting a foreclosure cleanup company is that the initial expensesare quite low as much of the equipment and tools needed for cleaningforeclosures can likely be found in your own garage:

Cleaningchemicals (i.e. all purpose cleaner, disinfectant, toilet bowl cleaner, windowcleaner, etc.
Cleaningsupplies (broom, mop, scrub pads)\
Vacuumcleaner
Garbagebags and shovels
Workgloves and disposable plastic gloves
Lawnmowers & lawn tools
Wheelbarrow

For thesmaller items you don’t have on hand, check your local dollar store. Their prices can’t be beat and they usuallyhave the same chemicals and cleaning supplies as the other retailers. Once you start doing some volume, considershopping for your supplies at Sam’s Club or Costco to keep your expenses low.

You can alsofind used equipment in great shape (such as vacuums) by going around to yourlocal Saturday morning garage/yard sales. If you have a “Re-Use” center or a Salvation Army, you may considerchecking there also as they often have vacuums and other small equipment oryard tools for sale.

For haulingjunk, you’ll need some sort of trailer and a vehicle large enough to pullit. If you don’t have a truck and atrailer, you can always borrow a friend’s truck and rent a trailer from U-Haul or just go ahead and rent a moving truckfrom U-Haul. (Remember though, thatyou’ll be charged a daily rate plus a per-mile rate when you rent a movingtruck whereas if you use your own truck and just rent the pull-trailer, you’llonly incur the daily rental rate for the trailer.)

Sometimesyou’ll be required to clean a property that doesn’t have electricity orwater. In the event that there’s noelectricity, you’ll need a generator to operate the vacuum cleaners and otherelectrical equipment. These can berented at Lowe’s or Home Depot and is a much better alternative to purchasingone outright unless you’re going to use it on a regular basis (a new one willrun you about $500+).

To save onexpenses, it’s best to rent equipment in the beginning. Once you get up and going, it may be worthlooking into purchasing equipment of your own. Check the online classifieds ads (such as Craigslist, Kijiji and Backpage)for used trailers, generators, etc. Youshould also check with U-Haul as they have been selling some of their excesstrucks as of late.

Stay Safe on the Job

As a business owner, you’reresponsible for keeping your staff safe while working on the job. Workingsafely is paramount to the health of your staff and the reputation of yourbusiness (and also keeps your insurance premiums low). It’s imperative that you review safety issuesprior to allowing anyone to work on the job – you must provide both classroomand on-the-job safety training to all new hires.

Now, it doesn’t have to beanything fancy; you can spend 20 – 30 minutes reviewing safety policies, safeworking practices and answering any questions and then you’ll be done! Make sure you have people sign in and out ofthe meeting and that you document that a safety meeting took place.

It’s also very importantthat you become familiar with OSHA and Safety Standards as well as the health& safety hazards associated with this industry so that you can keep yourstaff safe, avoid accidents and costly fines. You can find the OSHA Pocket Guide to Construction Safety (it’s a shortand an easy read) at this LINK

Another way to protect yourstaff and your business is to make sure that you check references before youhire someone. Insist that they listnon-related references (i.e. not mother, sister or best friend) and insteadlist references of previous employers or someone they know in a professionalcapacity. We also do drug testing andbackground checks – it might sound paranoid to some, but the safety of ourstaff, our customers’ property and our company’s reputation is far tooimportant to risk not spending $20 on a background check or drug test.

For more great informationon staying safe on the job, read our previous post, which can be found below.

Price Your Services Right

In this industry, the lowestprice always wins the bid (unless, of course, the lowest bidder has a terribletrack record of completing the work and is utterly irresponsible andunprofessional, in which case the company has just committed reputation suicide and will never be hired again). Lenders don’t want tospend any more than they have to on these properties so you want to make sureyou price your services comparable with the going market rates (but at the same time, priced so that you still make a great profit and don't leave any money on the table).

For cleaning out foreclosures,most banks expect to spend anywhere from $500 - $1500 for a cleanout (trashout,interior clean and initial landscape cleanup), but it could be a bit more or abit less, depending on your area. It’simportant to know that most lenders have prescribed “price caps” for themaximum amounts that they’ll pay for services. In the Foreclosure Cleanup Cash program (www.ForeclosureCleanupCash.com),we tell you exactly what the correct price ranges and caps are so that you’llnever price yourself out of a contract. We’ve also included as a special bonus an actual bid that we did (withphotos) so that you can get an idea of what a real winning bid looks like.

If you’re also providingpreservation services, a great site that we’ve used before to determine ourprices for doing repairs is www.CostEstimator.comfor getting the market rates for construction costs – you can get a free 30 day trial (no need toenter credit card – it really is free!). There are over 3,000 cost items adjusted for over 210 local, geographicregions to create your bid and you can add as many others as needed. If you want to sign up after the trial, it’sonly $15/month.

Market Your Services

It’s true –“nothing happens until somebody sells something”… and you’ll need to get outthere and sell, sell, sell your business. Once you’ve done a few jobs, you’ll find that word of mouth advertisingand referrals will provide a large pool of new jobs for you, but in themeantime, you do need to do everything possible to let customers know youexist.

A largeportion of work will come from the relationships that you build with RealEstate Agents (“Realtors”) who list bank-owned homes (often referred to as REOlistings). They are often given the taskof bidding out the cleaning and repairs of new listings by the asset managementcompany so you’ll want to make sure the agents in your area know your companyhandles this type of work.

A great way tofind out which Realtors in your area list REOs is to go online to the majorbank's REO websites and "data mine" the contact information for thelisting agents (name, email, phone numbers). It can be painstaking work, butdefinitely worth it.

Here are a few bank REO sites to get you started collecting Realtorinformation:

WELLS FARGO

(Properties managed by Premier Asset Services)
NOTE: In order to access agent information, select the state and click search.Then, individually select each listing and click on "Print Property ReportCVS". Each listing and corresponding information (such as agent name,phone # and email) will be created in an Excel spreadsheet. You can access the page

M&T BANK

OCWEN FINANCIAL CORP

(We also list about 20 more different lenders’ REO sites in the Foreclosure Cleanup CashProgram which is essential for findingout which Realtors list bank-owned homes)

Remember tofollow up with a phone call a few days later. Don't be shy about asking theRealtor if he/she has any jobs for you to bid, either - most of them are veryaccommodating and willing to give a new company the opportunity to provideestimates.

The other wayjobs are bid out is through large Asset Management Companies (also referred toas Marketing & Management Companies, REO Field Service Companies andProperty Management Companies). Essentially, the lender says, “ok – I have thousands of properties toget rid of. Here, national ABC AssetManagement Company: clean, fix and sell these properties for us”. And the national Asset Management Companywill then subcontract out the work to local foreclosure cleanup and propertypreservation companies.

In order to workfor these companies, you usually need to sign up your company as a potentialvendor. Many times this can be doneonline (in the Foreclosure Cleanup Cash program (www.ForeclosureCleanupCash.com),we provide you with over 25 direct links and contact information to AssetManagement Companies (different from the lenders’ REO sites) where you can listyour company right away). There are bothpositives and negatives associated with working for the larger companies. On the positive side, you will probably begiven a few projects to work on at a time so you will be kept relativelybusy. On the negative side, they usuallywant you to offer ‘wholesale pricing’ and don’t pay until 30 – 60 days afteryou invoice them for the work. Workingfor one of these companies, however, will give you the experience you need togo after more work.

Other possiblecustomers include wholesale property investors (groups of investors thatpurchase foreclosed homes at the auctions and then sell them to smallerinvestors at a wholesale price), investors, landlords, property managementcompanies, Realtors and so on.

You should alsoconsider attending your local networking events such as the Chamber of Commercemeetings and any local investor meetings in order to hand out your card andnetwork with potential customers. Themore you get out there, the better chance you’ll have of securing some great,long-term customers!

Well, hope thisinformation helps to get you started in the right direction – this isdefinitely an exciting industry and a very profitable one for those of you whodon’t mind getting your hands a bit dirty

****

The Foreclosure Cleanup Cash Program

There iscertainly much more to know than can be found in this short article, so ifyou’re interested in learning all of the ins-and-outs of the business, considergetting the Foreclosure Cleanup Cash Program (www.ForeclosureCleanupCash.com).

In this program,we provide you with a 200 page manualon exactly what you need to know to start your company, how to market it to theright contacts, what services to provide and how to do them and exactly how toprice your services within the industry guidelines. We actually alsoprovide you with a real estimate of aforeclosure cleanup bid that we did, including step-by-step estimate instructionson exactly how we priced the services and before/after photos to go withit.

As an additionalbonus, we include all of the forms,estimate spreadsheets, sample agreements, checklists etc. that you'll needto get your business off to the right start. If you go to the website andscroll down to the bottom of the page, you can see a full chapter-by-chaptertable of contents (www.ForeclosureCleanupCash.com)

The thing thatmany people really like about this program is that it's detailed - we don't just tell you"go out and market your company" - we say, "Ok, here's the exactperson you need to contact to get your company signed up on the vendors list soyou can start receiving requests for estimates". It's a full 200pages long plus a bonus15 page report that shows you in detail an actual foreclosure cleanup that webid on (and won the contract for), including pricing and work scopeinformation.

Since we have firsthand knowledge from running a successful cleanup andpreservation company, we know exactly how this industry works and what you needto do in order to succeed. This is the most comprehensive programavailable online for learning how to start and run a profitable ForeclosureCleanup & Property Preservation service. We're always updating ourblog and forum, which are also great resources, and we're always here to helpanswer any questions you might have with the program

Now… stay tunedfor the next segment on on-the-job safety!

Happy Trashing!

Les Tyler

CEO/President

www.ForeclosureCleanupCash.com

PART 1 - Reality Check: Some Properties Are Downright Scary! Protect Yourself and Your Staff

2009-05-22T18:44:00Z

Whew!

I just finished getting back from doing an on-site estimate and yeow-zers! I've seen a lot of foreclosed properties out there but this one was just downright scary!

Nope, it wasn't the dirt road leading into the no-man's land 'neighborhood' (and I use the term very loosely as property lines were certainly not clearly marked), nor was it the multitude of scattered mobile homes guarded by ferocious-looking pit bulls. It wasn't the 4' pile of trash full of dirty diapers, animal feces and rotting food, nor the huge hole burnt right through the floor that I had to step around once I got inside. Nope - none of these things scare me (anymore) as I see them all the time.

What really scared me was... The closed door with the missing door handle.

Now normally, this wouldn't have been such a shock, except that when I took a closer look, I saw a human eye looking at me intently through the hole!

And this human eye was attached to a real person looking back at me with a mixture of panic and fear. I'm sure my facial expression mirrored his as I was pretty darn startled.

Going through this experience today made me realize how important it is to talk about the safety issues that come along with running a foreclosure cleanup/property preservation company. Here are the three main safety concerns we routinely face:

1. Health hazards
2. Unsafe premises
3. Facing trespassers

As this is a lengthy discussion, I'm going to start a three-part series on this blog to discuss each of these in more detail and how you can protect your staff from these safety concerns .

PART I: Protecting Yourself From Health Hazards

Some of the major health hazards you'll be subject to while doign these cleans include feces, rotting organic matter and mold, and bloodborne pathogens.

Let's talk about each of these in detail:

Feces

Now I'm sorry to be so blunt, but no one likes to have to pick up poop. Unfortunately, feces (both animal and human) is routinely found in vacant homes and it's part of the job to clean it up. Sometimes people spread it around on purpose to "get back at the bank" and other times you will find it as a byproduct of poor living conditions (i.e. using toilets without water, throwing dirty diapers in the corner). It's also common to see animal feces inside (mostly from cats and dogs, although I've also see coyote feces) from animals that have entered the property seeking shelter or from pets who were left behind. Mold is another big concern, and is often found in abandoned properties.

Organic Matter and Mold

In addition to feces, organic matter also includes the rotting food you'll find in the fridge or strewn about the house, dead animals, mold, etc - pretty much anything that was once alive or fresh. The problem with cleaning up this harmful organic matter doesn't just stop at the way it assails your olfactory senses. There's huge potential for getting infections from putting your skin in contact with this type of material. It's essential that you wear thick gloves to prevent skin contact (not just the plastic medical gloves - they won't do much to physically protect your hands from sharp objects. See the YouTube video below for special gloves you can order or get yourself a pair of heavy gloves from Lowe's or Home Depot (but these won't necessarily protect you from needlestick, discussed below.) Depending on the severity of the situation, you should also wear a face mask to help minimize inhaling harmful substances. This is especially important if you're around mold.

On the topic of mold, it's important to seek a professional opinion from someone certified in mold remediation before attempting to remove it yourself. There are numerous health concerns as well as major potential liability issues if it's not done right. Contact your local fire/water restoration or mold remediation company for assistance. If you're interested in becoming certified, contact www.MoldCareer.com for information on becoming certified in Mold Inspection / Mold Remediation.

One last topic that

Bloodborne Pathogens

A second health concern is bloodborne pathogens you may find at the property which include human immunodeficiency virus (HIV), hepatitis B virus (HBV), hepatitis C virus (HCV), and others which can be found in human blood and other potentially infectious materials (OPIM). According to the OSHA website, OSHA (the Occupational Health and Safety Act) defines blood to mean human blood, human blood components, and products made from human blood. Other potentially infectious materials (OPIM) means:

The following human body fluids: semen, vaginal secretions, cerebrospinal fluid, synovial fluid, pleural fluid, pericardial fluid, peritoneal fluid, amniotic fluid, saliva in dental procedures, any body fluid that is visibly contaminated with blood, and all body fluids in situations where it is difficult or impossible to differentiate between body fluids;
Any unfixed tissue or organ (other than intact skin) from a human (living or dead); and
HIV-containing cell or tissue cultures, organ cultures, and HIV- or HBV-containing culture medium or other solutions; and blood, organs, or other tissues from experimental animals infected with HIV or HBV.

The most common cause for concern is the potential for needlestick injuries. We've been to many properties where the previous owners were drug users and left used needles laying around. The cleanup of these needles is very dangerous as it poses a huge needlestick concern (i.e. getting pricked with the needle). All of our staff undergo bloodborne pathogens safety training and needleprick safety training prior to being allowed to work in the field.

Per OSHA law, you must provide youremployees with an offer of FREE three-injection Hepatitis B vaccination series to all employees who are exposed to blood or other potentially infectious materials as part of their job duties.   The vaccination must be offered within 10 days of initial assignment to a job where exposure to blood or other potentially infectious materials can be "reasonably anticipated." According to OSHA, workers who decide to decline vaccination must complete a declination form. Employers must keep these forms on file so that they know the vaccination status of everyone who is exposed to blood. At any time after a worker initially declines to receive the vaccine, he or she may opt to take it.

Cleaning Up and Disposing of Needles

We prefer to use tongs to pick up needles while wearing heavy protective gloves. One person is assigned to this job and is responsible for safe disposal, but all staff must wear protective gloves and constantly be aware of potential needlestick dangers.  In terms of disposal, you cannot just throw the needles in the trash.   They have to be put in a leak-proof and puncture-resistant container with a permanently locking, snap-top lid for safe disposal (a 'medical sharps' container).   You can purchase these containers at a local pharmacy or online.

You also cannot then throw this container in the trash - you have to dispose of them safely.   Some medical device suppliers have mail back service where you can actually mail the containers back to them for safe disposal. Try calling the AIDS Action Committee Pharmacy Access Hotline to find out more about personal sharps containers at 1-800-988-5209. You can also go to www.SafeNeedleDisposal.org to search dropoff locations. You may also be able to get some answers from your local pharmacy by explaining your need for safe disposal of needles.

Here's a pretty neat YouTube video from Hex Armor Gloves (www.HexArmor.com) showcasing the strength of their gloves. You may consider getting a pair of these for anyone exposed to needles.



If you suspect that drugs were used in a property, it's essential that you contac the Realtor or Asset Manager immediately before cleaning anything up. (You can go ahead and take pictures, though). I like to have my Site Supervisor call me first to describe the situation, and send me pictures via his/her phone. I'll then place an immediate call to the property contact person and send a written request of how to proceed with a photo attached.

The reason you shouldn't go ahead and clean up without authorization is twofold: 1) the Realtor/Asset Manager may have a specific protocol that needs to be followed and 2) you could actually be standing in the middle of a crime scene (which, for anyone who watches CSI, knows that this is not a good situation for you to be in). Wait for instructions before proceeding.

Speaking of crime scenes, if you suspect that a crime may have taken place on the property, immediately remove yourself from the premises and call your point of contact.  I hate to scare you, but sometimes these properties are in dangerous neighborhoods and harbor dark secrets. Fortunately, we have never seen anything more serious than an empty property used for drugs, prostitution and drop houses (all serious crimes in their own right) but you have to keep your guard up. And if you you ever feel like you're in immediate danger, call 911 right away. Don't feel foolish for doing so - trust your instincts and take the necessary action to protect yourself and your staff.

Well, enough scaring you off for today!

Every business has it's own inherent risks, and the foreclosure cleanup/property preservation industry is no different. Everyone is always interested in learning about the profit potential from running this kind of business, but I thought it would be equally important to discuss the steps you need to take to protect yourself and your staff.

Over the next few days I'll be posting Part 2 (unsafe premises) and Part 3 (facing trespassers). I'll even tell you the rest of the story with what happened after I discovered the man looking back at me through the empty door handle...

Stay tuned, and stay safe!

Les Tyler
CEO/President
www.ForeclosureCleanupCash.com

Great Discussion Board on ContractorTalk.com

2009-05-21T14:40:00Z

Hi everyone;

I just wanted to pass along a great link to a discussion board on ContractorTalk.com on REO/Preservation Services. You can access the Message Board by clicking on the link.

You can also post to our own message board at forum.foreclosurecleanupcash.com - I'm hoping to get a few discussions off to a great start but I need your help! Please go ahead and post your questions if you think you have a common question here rather than emailing me directly - this way, I can post the answer which will help out everyone. Of course, you can always email me personally if you like at info@foreclosurecleanupcash.com

Have to run - I'm heading out to do an estimate clear across town and want to get an early start before it gets too hot out!

Les Tyler

New Forum - Foreclosure Cleanup & Property Preservation Services

2009-05-05T06:04:00Z

Hey Everyone;

We're getting some great discussions going here so I thought I'd start a forum so we can share our information with others. It's dedicated to the REO Cleanup & Preservation industry - tips, tricks, how-tos, gripes... let's get this thing started!

Please feel free to start new topics and share your knowledge as well as get the word out to the rest of the 'net.

Check it out at http://forum.foreclosurecleanupcash.com or you can click here

"How Can I Get Paid Sooner?"

2009-05-05T05:53:00Z

“I really, really enjoyed the Foreclosure Cleanup Cash Program. The one challenge I see is having to wait for 30+ days to get paid, especially when you’re a small guy like me just starting out. I really need the money sooner - how can I overcome this?”

- Jon

Hi Jon;

Glad you enjoyed the book!

You're right - waiting for 30+ days for payment is difficult, especially when you are first starting out. The larger companies generally pay 30 - 60 days after invoices are submitted (although most of them pay around the 30 day mark). These larger companies are generally sending vendors 10+ properties to service/cleanout per month.

The smaller companies and investors, however, generally pay upon completion of the project or within 15 days. Unlike the larger companies though, they may only send a few projects your way, but this is fine if you're starting out and doing most of the work yourself (and in the beginning you will definitely have to do most of the work on your own. Many companies I know that just started out asked family/friends to help out instead of hiring staff as they are usually willing to help you out and willing to wait a bit to get paid).

I would recommend targeting investors who have bought properties that they are intending to rent out or flip and/or smaller asset management companies in your area. Here are some ideas for doing this:

1. Put an ad online on Craigslist or Kijiji saying something like, "ATTN INVESTORS - We'll clean up and repair your property for the best prices in ________ (name of city where you live)" or “We Clean Up & Fix Up Bank-Owned Properties” or even “We Clean Up & Repair Houses” and then in the main text, describe your services and contact information.

2 Look for companies or investors that "wholesale properties" - this is a group of investors will purchase a house (usually for cash) for way under market value and then turn around and sell it to another individual investor that is willing to put the time and money into the property to fix it up. You can find these companies by Googling terms like, "Wholesale properties + (your city)", "wholesale real estate + (your city)", "real estate investors + (your city)". You may have to sort through some unrelated links but this is probably the best way to locate these wholesale investors. Once you do, give them a call and tell them that you're in the property preservation business and you'd like to offer them your services. You can also tell them that if they refer your services to an investor that buys one of their properties that you'll give them a "finders fee" commission (usually 10% of the value of the contract). The best thing about these investor groups or individual investors is that they will sometimes give you a deposit (25%-50%) to start the project and then pay you the rest as soon as the work is done.

3. Contact Realtors and ask them if they know of any individual investors that require property preservation services. You can offer them a "finders fee" too as a bit of an incentive, but only for individual investors (remember my little story in the Foreclosure Cleanup Cash Program about offering finders fees to Realtors that work for larger AMCs? Definitely a no no!)

4. While you have the Realtor on the phone, ask them if they have any current listings that need a move out clean or some minor repairs. Sometimes a regular seller (including homeowners and investors who currently own property) will realize that their house needs a good clean or a paint job in order to move it off the market. This is a good opportunity to get some "before" & "after" photos as well as a good reference for your services. And, as a bonus, these people usually pay immediately also.

You will definitely have to spend some time on the phone and on the internet (searching for potential customers and sending out introduction emails). It does take a bit of time to plant the seeds but eventually, something will grow. Also, make sure you get some business cards (try www.vistaprint.com) and give them out to everyone you know! If you belong to a church, sometimes they will let you advertise in their church bulletin for free or for a very small fee (i.e. $20). Let everyone you talk to know that you've started a business and that you would appreciate any referrals, no matter how small the job - word-of-mouth referrals is a very effective way to advertise (and it's free!). Again, you can also offer 10% finders fee as a "thank you" for anyone who refers you a job.

Another really important thing: when you do a job, invoice immediately and ask them when you can expect to be paid (on your estimate you should put payment terms, such as "Payment due upon receipt" or "Payable within 7 days of invoice receipt"). Don't wait around to get your invoice to them because the longer you wait, the longer it will take for them to pay you.

So, in summary, look for the smaller jobs first to help build up your "before & after" photos as well as your references. Since they usually pay faster, it's also a good way to build up some savings so you can afford to go after the big companies and then wait the 30+ days to get paid. You have to spend some time working at it, but you'll definitely see big payoffs if you put the time and energy into getting the word out.

"Do I Need to Be Licensed?"

2009-05-05T05:51:00Z

“I really want to start a company cleaning and fixing up bank-owned homes but someone told me that I need to have a general contractor’s license to do this. Do I need a license? How do I find out if I need one and how do I get one?”

- Billie

Hi Billie;

Great question - let me try to answer it for you:

The Foreclosure Cleanup Cash program covers how to start up two types of REO services: 1) cleaning up foreclosures (removing junk, cleaning the inside of the house and yard cleanup) and 2) property preservation services (minor repairs, painting, some remodelling, etc.)

If you're just providing the first kind of services (cleanup only), you won't need a general contractors license as this is a non-specialty service. If you're providing property preservation services, some states do in fact require a General Contractors license if you're performing work over a certain value or if you're contracting out the work to another trade. Otherwise, you may be able to perform basic “handyman work” (such as small repairs) if it’s under the specified value; usually under $1000 or $500 but make sure you check with your state’s requirements first.

What many people do when they're first starting out in the REO industry is just offer cleanup services first until they start to generate income and build a customer list. During this time they'll work towards becoming licensed (if required by their state) and once they're ready, they'll get their license and then offer property preservation services.

In order to find out if you need a license, contact your state’s licensing department (the Foreclosure Cleanup Cash program lists direct contact information for each state for the appropriate licensing division). Here you’ll find out which trades require a license, how to get a license and how long the process takes. Some states are rather strict and require a few years’ of experience in your trade and others simply require classroom hours on topics such as contracts and business law. All states that license contractors generally require successfully passing a proficiency test.

You're definitely on the right track thinking about starting a foreclosure cleanup company - there are many opportunities associated with this kind of business and lots of work out there. It's one of the best ways to start making some good extra money (you can charge anywhere from $400 - $1500 for each cleanup, depending on the property and you can usually get it all done in one (long) day) and you don't need very much start-up funds or any type of specialty knowledge. Once you start getting into offering property preservation services such as painting and minor repairs, the financial returns can be much higher. It’s definitely hard work, but definitely worth it.

Marketing Directly to Lenders

2009-05-05T05:49:00Z

I've been getting some great questions lately on starting a foreclosure cleanup/property preservation comapny so I thought I'd post some of the Q&As here on the blog to share with everyone.
- Les

"I just started my own cleanup company a few weeks ago and I want to start getting my name out to banks so I can work for them. Does your program cover how to contact the lenders directly?"
- Pat

Hi Pat;

Yes, we do. In the Foreclosure Cleanup Cash Program, we offer over 25 direct links and contact information for Asset Management Companies and Lenders REO Departments - we provide direct links to the Vendor sign-up pages so that you don't have to sort through the entire website to fill out the forms. We also provide some great inside information on how to find and contact Realtors that list REOs in your area.

When it comes to providing services for bank-owned homes, there really isn’t an exact method for becoming a vendor as all properties are treated differently.

However, when it comes to marketing your services, there are three types of “customers” you’ll want to focus on:

1. Lenders’ REO Departments
2. Realtors that list REO properties
3. Asset Management Companies (used by lenders to market, manage and dispose of bank-owned properties)

In our experience, we've found that approaching the lenders via the Asset Management Company that disposes of their properties or the Realtor that has the listing is a really effective way to earn contracts, rather than contacting the lenders directly (as many of them outsource the vendor management). However, there are definitely some banks that deal directly with vendors - it just depends on the bank.

We’ve always found that Realtors can be a great resource for earning contracts as they are sometimes the person who is given the task of bidding out the cleanup and the repairs.

A great way to find out what Realtors list REO properties is to pick up one of those free real estate magazines. You'll see bank-owned homes listed for sale and will be able to determine who the listing agent(s) are. You can then use the contact information to introduce yourself either by phone or email and get the word out that your company provides property preservation services. While you have them on the phone, ask them if they currently have any listings that you can bid on - they are usually very willing to accept a proposal for services from another company and will often give you a try, even if you're new.

Check out the Foreclosure Cleanup Cash program at www.ForeclosureCleanupCash.com for more information on how to start up your company, what services to offer, how to marketing your services to the right REO contacts and their direct contact information.

Foreclosure Cleanup Cash Program Officially Launched

2009-04-27T00:54:00Z

Whew! We finally made it!

The Foreclosure Cleanup Cash Program Officially Launched Today!

It's a very good possibility that I now have Carpal Tunnel Syndrome in both of my wrists from writing like a maniac trying to tie up all of the loose ends in the manuscript (sheesh, it is almost 200 pages) ... but ... the good news is that you can now order your very own copy of the program online at www.ForeclosureCleanupCash.com. (I think it's been about 36 hours almost to the minute since I last saw my bed... and I am definitely not used to pulling all-nighters like I used to while at University!)

So to all of you fine folks who pre-ordered and then waited patiently - thank you for not sending me hate emails when I went a day past the original deadline I definitely think it was worth the wait - lots of good stuff in there that I think you'll really enjoy and find useful - especially the information on pricing your services.

I will keep you all posted as to when the Bidding Software will be ready - while not a magic bullet, I do think this is going to make everyone's life a whole lot easier when it comes to putting together your base pricing for bids. We've been using a "less-finessed" version at the office for the last few months and I find that I churn out the bids faster because they're less of a pain in the neck to do. (And if you've already bought the program, the software will be coming your way free of charge as soon as it's ready to launch.)

Well gang, off to bed early for me - busy monday morning at the office and I have to be bright-eyed and bushy-tailed while I'm out making the rounds.

Happy junking!

Les

Welcome

2009-04-26T00:39:39Z

Welcome to my blog. Please check back soon for new entries.