How to Start a Foreclosure Cleanup and Property Preservation Company
yourself to capitalize on this coming foreclosure movement
If you want to be hired for cleanup or property preservation work, you'll need to operate your business as a professional company. The good news is that you can set up a business quickly and inexpensively, and usually on your own. Many people decide to set up an LLC (Limited Liability Company) because of how quickly and easily it can be done but you'll want to check with your accountant or other business professional to select the type of business entity that's right for your personal situation.
If you do decide to start an LLC, you can usually find all of the documents you need online from your state's government website. Usually the branch you're looking for will be called the "Industrial Commission" 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 your business 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: type in "IRS" & "EIN" into a search engine to find the online registration link. As soon as you have your EIN (which you can usually get immediately online), you can open up a business 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-day dealings of running a business and use their personal accounts to pay for business expenses. Not only does this present an accounting nightmare at the end of the year, but it could present problems for you with the IRS if you don't keep your personal and business finances separate.
So to recap:
1.
Legally set up your business
2.
Get your EIN # and set up a business bank account
3.
Apply for a business license
4. If you want to do preservation work, determine whether or not you need a contractors' license
Get Insurance
You absolutely must have a Commercial Liability Insurance policy and Workers' Compensation Insurance in order to run your business. Not only is insurance essential for protecting yourself from liability and protecting those that work for you in the event of a work-related injury, but many asset management companies will not do business with you if you do not meet their minimum insurance requirements. Insurance will likely be one of your largest start-up costs, however, most insurance companies allow you to pay the premium on a monthly basis, which definitely makes this expense more affordable.
Foreclosure Cleanup v.s. Property Preservation Services As the name suggests as a Foreclosure Cleanup Company, you'll be cleaning out all of the junk in the house (also called a "trashout or a "junk out"), as well as cleaning the interior of the home. You may also be required to remove vehicles on the property. Usually foreclosure cleanup companies are also responsible for doing a basic landscape cleanup which includes hauling out any junk from the front/back yards, cutting the grass and trimming trees/bushes.
Here are some of the services that a preservation company may offer (note that a Property Preservation Company will generally also offer cleanup services):
Securing the Property o
Initial vacant property inspection
o
Lock changes
o
Boarding of windows and doors
o
Temporary roof repair
o
Securing swimming pools
Preserving the Property o
Exterior Debris removal
o Abandoned vehicle removal (cars, boats, etc.) o Interior Debris removal (junkout) o
Hazardous waste removal
o Interior cleaning services including carpet cleaning o Window washing/graffiti removal o
Window replacement
o Pool services (draining, acid washing, maintaining, etc.) o
Pest control services
o Yard maintenance/landscaping
o Snow removal o Winterization o Gutter cleaning o Pressure washing o Carpet removal & replacement o Tile/Floor repairs o Painting o Sheetrock/drywall repairs o Carpentry repairs o Plumbing fixtures repairs & replacements o Fire & mold remediation o Fence repair
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