Following are a few things to keep in mind when hiring help to assist you in your foreclosure cleaning business.

1. Use a Staffing Agency: One of the easiest ways to hire workers – quickly – is to go through a staffing agency. Agencies like Labor Ready are ideal for staffing the types of jobs foreclosure cleaning companies handle because they specialize in providing staff in industries like construction, cleaning, lawn care, etc.

Going through an agency is beneficial because they handle all the upfront paperwork, employee screening, drug testing, etc. You tell them what you need and they supply the workers. You pay them and they pay the workers. You don’t have to worry about W2s, 1099s, checking references, etc.

While this is a simple, quick way to hire the help you need, it is not without its drawback.  One of the main drawbacks is that you’ll most likely be paying workers by the hour. Hence, if you misjudge how long it’s going to take you to do a job, it can eat into your profits. For example, if you’ve estimated that it’s going to take 7 hours to complete a job, but it winds up taking 10, then that’s more money out of your pocket.

And, if you have to pay say two workers, that’s six extra hours of work. If you’re paying each worker $10/hour, that’s an extra $60 – directly out of your profits.

Hence, you it’s important to be as precise as possible when putting together your foreclosure cleaning bid. Be sure to build in enough of a profit so that if a job runs over in time, it doesn’t eat up too much of your profits.

Note: When hiring labor from a staffing agency, ask about each worker’s work history with the agency, eg, how long have they temped through the agency; how many times have they been sent out in the last few months; what’s the feedback from other clients; etc.

The reason you want to do this is, recruiters work on commission (I know, I was a recruiter for over a decade). So it’s to their benefit to have as many workers on someone’s payroll as possible. Sometimes, they may not do their due diligence in checking a worker’s history. This is particularly true with day laborers, the kind of workers you’ll likely be using.

A worker could literally have walked through their doors yesterday and if your job order crosses their desk and it seems like a fit, they’ll send them out to you. This is before any background or reference checks have been done.

So be sure to ask. Remember, it’s your foreclosure cleaning businesses’ reputation that’s on the line.

2. Don’t Rely on Friends and Family: Many small business owners – and foreclosure cleaning business owners are no different — make the mistake of hiring friends and family.

This can be a huge mistake, for it can not only damage your personal relationships, but it can damage your business reputation as well.

Remember, you’re operating a business – your very livelihood. And, you’re not a friend or family member when you’re working. You’re officially the boss.

Some  friends and family can’t make the transition form “family/friend” to “employee.” For example, what if you have to ask them to redo something that wasn’t done correctly the first time. Or, if you have to ask them to stay later because the job is taking longer than expected.

What if they refuse?

See how easily this can cause problems.

It’s just too risky to mix business with personal relationships. Where possible, avoid it at all costs.

3. Pay a Fair Wage: Just because you may be able to get away with paying minimum wage, it doesn’t mean you should. Build a decent wage into your foreclosure cleaning bid so that you can fairly pay workers. Remember, this type of work can be backbreaking.

Paying a little more will give your company a good reputation so that when it’s time for you to hire, you will have loyal workers who will not only do a good job for you, but they’ll recommend others to you on that basis also.

If you keep these things in mind when staffing your foreclosure cleaning businesses’ jobs, you should have no problem hiring competent, affordable help – quickly.

P.S.: Learn more about how to operate a successful foreclosure cleaning business.Read how one foreclosure cleaning business owner makes up to $40,000/wk.

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.

40% of lenders unable to produce promissory notes that prove homeowners they’re trying to foreclose on indeed owe the debt.

If you know anything about debt collection, one of the first things a creditor must do is prove that you indeed owe the debt. If they can’t prove it, then you can stop the foreclosure process.

A home foreclosure expert in the video says don’t let the lender off easily if they’re trying to foreclose on your proeprty. “Make them produce the note,” he says. In the video, 14 homeowners in Florida were able to prevent foreclosure — at least for the time being — until their lender could produce the note.

Watch this eye-opening, June 23, 2008 CNN report on using this method to prevent foreclosure.

P.S.: Get info on 32 ways to stop foreclosure: Discover what banks won’t tell you & investors don’t want you to know.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

To put this in some kind of perspective, only 25 banks faltered in 2008, which was still a lot, especially when you consider that only 32 banks failed from 2000 through 2007.

While no one likes to hear of banks failing in communities across the country, it can be good news for foreclosure cleaning companies and others who operate real estate service businesses like general contractors, painters, electricians, and plumbers. Why?

To understand fully, it helps to know what happens when a bank fails.

Insight for Foreclosure Cleaning Biz Owners: What Happens When a Bank Fails

When a bank fails, it first falls in the hands of the Federal Deposit Insurance Corporation (the FDIC). Then, they usually go on to be bought or taken over by other banks and/or financial institutions because they have assets and customers who still need to be serviced.  This is, in part, why you see the FDIC seal in every bank. The FDIC protects the assets of every day consumers in case a bank fails.

Who to Target When a Bank Fails to Get Ongoing Foreclosure Cleanup Jobs

Oftentimes, once a failed bank is taken over by the FDIC, they contract with larger property preservation companies to handle the maintenance of the failed bank’s real estate assets (eg, foreclosed homes, foreclosed commercial properties, etc.).

And this is where it gets interesting for you, the small to mid-sized foreclosure cleanup business owner. You see, these large property preservation companies are backlogged. They are taking way too long to service all of the properties assigned to them.

These properties can’t sit vacant/abandoned because the bank that owned them failed. They need to be maintained so that they can be put back on the market to be resold. This means they need inspections, yards cut, shrubs trimmed, winterization, boarding up, lock changes, etc.

When you add to this that every time a bank fails more properties are dumped in larger property preservation companies laps, it’s easy to see why they are so backlogged.

So . . . what do they do? The contract with small to mid-sized foreclosure cleaning companies (like yours!) to help them at least try to keep up.

If you’re one of the lucky ones to be properly set up as a foreclosure clean up business – ie, licensed and insured — you can target those handling failed banks to get work.

Who to Target When a Bank Fails to Get Ongoing Foreclosure Cleanup Jobs

As a foreclosure cleanup business owner, you would contact the REO asset managers within acquiring institutions (ie, the FDIC or whichever institution took over the assets of the failed bank).

While it may take some elbow grease to get through to them, getting an “in” with just one of these companies can provide you with all the foreclosure cleaning jobs you will ever need. So it’s definitely worth it to put in the time it takes.

Partial List of Failed Banks in the First Two Months of 2010

Following is a partial list of the banks that have failed as of March 1, 2010 in the U.S.

Horizon Bank, Bellingham, WA, Jan 8

Town Community Bank & Trust, Antioch, IL, Jan 15

Premier American Bank, Miami, FL, Jan 22

Charter Bank, Santa Fe, NM, Jan 22,

First National Bank of Georgia, Carrolton, GA, Jan 29

1^st American State Bank of Minnesota, Hancock, MN, Feb 5

The La Coste National Bank, La Coste, TX, Feb 19

George Washington Savings Bank, Orland Park, IL, Feb 19

Carson River Community Bank, Carson City, NV, Feb 19

Rainier Pacific Bank, Tacoma, WA, Feb 26

Full List of Failed Banks

To see the full list of failed banks, visit the FDIC’s failed bank list. This is good information to know as a foreclosure cleanup business owner.

The article states:

The proposal, reviewed by lenders last week on a White House conference call, “prohibits referral to foreclosure until borrower is evaluated and found ineligible for HAMP or reasonable contact efforts have failed . . .

Prevent Foreclosure: What is HAMP?

HAMP is the administration’s Home Affordable Modification Program. The program is available for home loans that were taken out prior to January 1, 2009. It will expire on December 31, 2012.

Find out if you are eligible for a home loan modification or refinancing via HAMP.

Make Money in Home Foreclosures

Learn how to register with your local housing authority to get foreclosure cleaning jobs (and other RE services related work, eg, painting work, plumbing jobs, general contracting work, lawn maintenance contracts, etc.).

Prevent Foreclosure Advice: What Is a Forensic Loan Audit

In basic, layman’s terms, a forensic loan audit is simply an examination of all the documents you signed when you got your home loan to see if they comply/complied with lending laws.

The legality surrounding forensic loan audits stem from the 1968 Truth in Lending Act (the TILA). This law is also known as the Consumer Credit Protection Act. Its purpose is to:

. . . promote the informed use of consumer credit, by requiring disclosures about its terms, cost to standardize the manner in which costs associated with borrowing are calculated and disclosed.

As it relates to home loans, it short, it lays out the rights of homeowners when they take out a mortgage.

How a Forensic Loan Audit Can Help You Prevent Foreclosure

And, here’s how/why it can help you.

You see, every detail of your home loan (your mortgage) must be disclosed, explained and disseminated when you take out the loan. But really, who takes the time to read all of that info? Practically no one. That’s why the loan officer explains every piece of paper you sign at your closing. They’ll give you a brief explain, say something like, “Understand? Have any questions?”

And when you say, “Yes, I understand and no I don’t have any questions,” they say, “Sign here.”

During the last housing boom (late 90s to about 2005), many lenders took so many shortcuts that some lending laws might have been violated. Remember all the of the “exotic home loans,” like zero percent down with a credit score of only 580?

These days you can’t get a zero percent down home loan with perfect credit! Most of these types of home loans have disappeared.

This just underscores how crazy some of the home loans were during the last housing boom. I know, I was a mortgage consultant for a time during this period. Banks, lenders and mortgage brokers played “loosy goosy” with federally mandated compliance guidelines (ie, the stipulations of the Truth in Lending Act) during this time.

During a forensic loan audit, if you find violations, this can be used as a bargaining chip with your lender when trying to prevent foreclosure.

When you undergo a forensic loan audit, all of the documents you were presented with and signed at your closing will be reviewed – with a fine-tooth comb. Some things that will be looked at is whether or not you signed the right documents, the mathematical calculations of the interest on your home loan; the actual loan terms; etc.

If you have this done by a professional (eg, an attorney), they will present you with a detailed report of the findings.

While some who perform loan audits will tout that mortgages have been completely wiped out because of violation of the TLA terms, this is rare.

How Much Do Forensic Loan Audits Cost?

Rates vary if you hire someone to do a forensic loan audit for you. They can be from a low of $500 on up to a few thousand.

Beware of Home Foreclosure Scams

There are a lot of home foreclosure scams out there. And, this can be one of them. If you decide to have a forensic loan audit done, do your research. Don’t be pressured into it and whatever you do, don’t hand money over to someone unless and until you have thoroughly checked them out and you get something in writing.

Make sure they’re a legitimate firm. Compare firms; don’t just go with the first one to contact you through the mail.

Read more on how to avoid home foreclosure scams.

If you’re trying to prevent foreclosure via a home loan modification, a forensic loan audit can be a great place to start because it gives you leverage when it comes time to negotiating with your lender.

Make Money in the Home Foreclosure Market

Learn how to register with your local housing authority to get foreclosure cleaning jobs (and other RE services related work, eg, painting work, plumbing jobs, general contracting work, lawn maintenance contracts, etc.). Read the story of how one janitorial cleaning service grew revenues from $225,000 to over $10 million — all because of government contracts. So, sign up and get on the road to landing lucrative government contracts from local and federal agencies today.

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.

An Ohio man recently did just that, bulldozing his own home, which was valued at $350,000 — and that he only owed $160,000 on. He said he told the bank that was foreclosing on him, “I’ll tear it down before I let you take it.” And he stayed true to his word, levelling the home to a pile of rubble.

Read the entire saga in the article, Frustrated Owner Bulldozes Home Ahead Of Foreclosure.

Stop Foreclosure: Learn the #1 secret your lender won’t tell you that can prevent foreclosure.

P.S.: Read how one foreclosure cleaning business owner makes up to $40,000/wk.

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.

Housing and financial experts predict that 4-5 million foreclosed properties have yet to come onto the open market. Why? One reason is, banks are purposely NOT foreclosing on homeowners who are currently in default. Following is why.

Why Banks are NOT Foreclosing on Homeowners in Default & What This Means for You

By holding off on foreclosure, lenders allow home prices to recover to some degree. But it’s a “faux housing recovery” — at best. Lenders do this because so many homeowners are underwater. They lose when this happens because it’s more likely that a struggling homeowner will walk away from the property (ie, do the jingle mail walk). Or, they may do a short sale or file for bankruptcy. All of this hurts a lender’s bottom line.

BUT, home prices can’t recover if there’s a glut of inventory (ie, lots of foreclosed homes) on the market. It’s a classic case of supply and demand. After all, everybody wants a deal — and the more inventory there is, the less demand (or incentive) there is to pay a premium price. Once supplies dry up, then the pendulum swings back in the lender’s favor. Consider this.

Currently, there are an estimated 7.7 million homes whose mortgages are in delinquency, but are not being reported as REO (Bank Owned) properties on the market yet. Depending on who you ask, an estimated 4-5 million of these will be bank owned properties for sale within the next year.The reason for the current new wave of foreclosures is largely attributed to the failure of the Government’s “Making Home Affordable” program, launched a year ago this week. [Source: LoanSafe.org]

The bottom line is, a lot of homeowners may be coasting along thinking that they’re ok and that their lender will work with them to refinance or modify their home loan. The cynical part of me says, “Not so.” They’re just waiting for the market to recover and then more homeowners will be foreclosed on.

Prevent Foreclosure Advice

Get your financial act together as soon as possible and try to refinance or get a home loan modification beause once the market starts to recover, lenders will be much less likely to work with struggling homeowners.

Make Money in the Home Foreclosure Market

Learn how to register with your local housing authority to get foreclosure cleaning jobs (and other RE services related work, eg, painting work, plumbing jobs, general contracting work, lawn maintenance contracts, etc.).

Read the story of how one janitorial cleaning service grew it’s business from $225 to over $10 million — all because of government contracts. So, sign up and get on the road to landing lucrative government contracts from local and federal agencies today.

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.

This is in spite of the help the Obama administration has put forth to stem the tide of home foreclosures, ie, some $700 billion in TARP funds. Of this, the article states:

The funds, which will come from the $700bn Troubled Asset Relief Programme (Tarp), will be directed into programmes to help people struggling to pay their mortgages, such as the unemployed or those in negative equity (emphasis added).

The bolded portion of the last statement highlights the continuing problem; the reason home foreclosures are still at record highs.

American and Home Foreclosure: Why It’ll Probably Get Worse Before It Gets Better

Until the economy recovers, which means putting Americans back to work, home foreclosures may continue to rise. Numbers seem to be heading in the right direction. Unemployment recently dropped from a double-digit 10% to 9.7%. Slow progress, but progress nonetheless.

What Americans Need to Prevent Foreclosure

But, the problem many homeowners facing foreclosure have is that they need jobs — and they need them now.

You see, when you don’t have a job and have run out of savings, you start to fall behind in paying your bills. You may even have to start using credit cards to pay for the basics. This creates even more debt — right at the time you can least afford it because as anyone who’s ever been in debt will tell you, it’s a lot harder digging out than getting in – even when you start working. It can take months or longer to get on solid footing again.

But the thing that makes America great is that we always bounce back. And that’s what many homeowners facing foreclosure and other financial problems need to hold on to.

Learn the #1 secret your lender won’t tell you that can prevent foreclosure.

P.S.: Read how one foreclosure cleaning business owner makes up to $40,000/wk.

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.

The government stimulus money for many housing projects around the country is starting to be allocated, as we discussed last summer here in the post, Foreclosure Cleaning Contracts on the Way? When Will Gov’t Stimulus Money be Allocated?  This means local municipalities have money to spend on many projects that are ideal for foreclosure cleaning companies — and other real estate services companies like:

Appraisers

Realtors

Brokers

Property Preservation Companies

Termite & Pest Control Companies

Building Contractors

Carpenters

Tiling Companies

Window Repair and Installation Companies

Plumbers

Electricians

Roofing Companies

Drywall Specialists

Locksmiths

Window Installers

Lawn Care Companies

Painting Companies

Junk Haulers

Cleaning Companies

Pressure Washing Companies

Gutter Cleaning Companies

Learn how to register with your local housing authority to get foreclosure cleaning jobs (and other RE services related work).

You can also sign up with HUD for vending contracts. HUD is the Department of Housing and Urban Development. It’s mission is to:  

HUD’s mission is to increase homeownership, support community development and increase access to affordable housing free from discrimination. To fulfill this mission, HUD will embrace high standards of ethics, management and accountability and forge new partnerships–particularly with faith-based and community organizations–that leverage resources (emphasis added) and improve HUD’s ability to be effective on the community level.

Part of leveraging resources for HUD is to allocate funds to state and local jurisdictions for home and community improvement projects; many of which are ideal for foreclosure cleaning and real estate services firms.

One contract could be worth tens of thousands, hundreds of thousands, or millions. And, sometimes they go on for years. It all depends on what it’s for. For example, contracts are awarded to replace HVAC units in a low-income housing project; to clean up waste from a defined zone in a community; to board up windows on foreclosed properties in a certain zip code; etc.

Most contracts are awarded by bid — so you have to be signed up with your local Housing Authority or HUD itself in order to even be eligible to bid on them.

Benefits of Registering with HUD & Your Local Housing Authority for Foreclosure Cleaning Contracts

The beautiful thing about signing up and/or being awarded a local or federal contract are:

(i) Prestige: You can tout in all of your marketing material that you are a vendor with a local or federal agency. Just that alone can get you jobs.

(ii) You’re Vetted: Many times, once prospective clients (eg, banks and realtors) know that you are a vendor with a state or federal agency, they know you have all the proper credentials. Hence, you’re already vetted — and trusted.

(iii) Eligible to Bid on & Land Lucrative Government Contracts: Obviously, this is the leading benefit of registering with your local housing authority and HUD. You’re elgible to bid on a lot of contracts that are available. Even landing one can keep a small or mid-sized company busy for months (or years), depending on what the contract is for and how long it is.

(iv) Chance to Grow Quick: As mentioned above, even landing one contract can catapult your small or medium-sized business to the next level. Proof?

Cleaning Company Grows Earnings from $225,000 to $10 Million — All Because of Government Contracts

Read the story of how one janitorial cleaning service grew it’s business from $225 to over $10 million — all because of government contracts. So, sign up and get on the road to landing lucrative government contracts from local and federal agencies today.

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.

In the perfect scenario, the REO realtor who’s responsible for the property will get the power turned on for you. That way, you and your foreclosure cleanup crew can come in and knock the job out with no problem. However, it doesn’t always happen this way. Sometimes, the realtor is too busy; especially these days when they are handling so many properties. Or, they may not know what the procedures are for doing this and just don’t want to be bothered with it.

Options Open to Foreclosure Cleaning Companies When a Property Has No Power

You can handle this situation in a couple of ways if you want to keep the job. You can either: (i) turn down the job, which means losing a possible long-term client; or (ii) you can find a suitable workaround. Oftentimes, this means working with cold water instead of hot. And, if you know anything about cleaning, you know how much more difficult it is to clean with cold water instead of hot.

Foreclosure Cleanup: One Piece of Equipment You Need to Handle Homes with No Power

If you choose to take on the job (which is just smart business by the way), you can purchase a small, gas-powered generator. This will give you the hot water you need, and allow you to take on foreclosure cleanup jobs – even when a property has no power.

The generator pictured here is something like (exactly) what you’ll need. It’s sold at most major home improvement stores, and in all-purpose outlets like Wal-Mart. It’s light weight, hence easily portable; gives you enough power to do most jobs; and is pretty easy to use. If you’re not mechanically inclined, this is good to know.

And the cost – around $200. Not bad for a piece of equipment for your foreclosure cleaning business that will allow you to take on more work, right?

As your foreclosure  clean up business grows, you may want to invest in a more powerful generator. These can cost right at $1,000, which is still not bad, when you consider what it allows your business to do.  

Foreclosure Cleaning: When Renting Equipment Is a Good Option

If you don’t have the money to buy a generator right now, you can rent them at major home improvement outlets like Home Depot.

Many foreclosure cleaning business owners, don’t know this, but Home Depot (and Lowes, et al) rent all types of equipment – from generators to power tools to ladders – and a whole lot more. And, they rent by the hour, the day, the week and the month. Super convenient for every size business.

Following are some approximate generator rental costs. Note: The prices are based on the power capability of the generator.

–3000 Watts $39 for 4 hours / $56 per day

–6500 Watts, $49 for 4 hours / $70 per day

Renting equipment like generators is a great way to grow your company because you can take on more work without having a lot of upfront capital. In fact, don’t purchase equipment until you know you can truly afford it.

Learn more about when to buy versus when to rent equipment for your foreclosure cleaning business.

Note: There are going to be some foreclosure cleaning jobs that you’ll have to pass on – either because the home doesn’t have power, or some other factor. It’s okay to do this if you really aren’t equipped to handle it.

It’s best to let a foreclosure cleanup job go than take it on and not do a good job. You can ruin your business’ reputation before you even get started. Remember, you’re in it for the long haul. Grow – and take on – what you can really handle and do a good job it.  

Continued success with your foreclosure cleanup business!

P.S.: Learn how to get contracts from your local housing authority! Stimulus Money Hitting Housing Authorities Across the U.S. Means Contracting Opportunities for Real Estate Services Businesses (eg, Foreclosure Cleanup Companies, Electricians, Plumbers, etc).

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.