As a smaller foreclosure cleanup business, your company can sign up to subcontract work with larger property preservation companies. You can offer your services on a subcontract basis for jobs such as inspections, repairs, lock and window boarding changes, lawn maintenance, winterization, indoor trash removal, outdoor debris removal, etc.

Many of the larger companies increasingly require the smaller subcontractor to complete a questionnaire in order to be considered for foreclosure cleanup subcontracting work with their companies. These questionnaires are simple “elimination” tactics so larger companies can get the most qualified subcontractors.

Are you familiar with the HUD guidelines?

Many of these mini-tests are designed to determine your level of understanding of HUD’s guidelines for property preservation work. Many of the larger companies obtain much of their property directly from HUD’s management and marketing (M&M) contractors.

M&M’s contractors literally market and manage single-family properties owned or held by HUD. (These are homes that had an FHA-insured mortgage where the owners defaulted. The lender or mortgage company that suffered as a result of the default eventually titles the home to HUD in exchange for an insurance claim payment.)

A property conservation questionnaire can range from the very simple to the ultra-complex. See some sample questions and answers below.

Sample questions and answers

Many questionnaires contain common questions of the definition type of the real estate industry in relation to the Department of Housing and Urban Development. For example, a questionnaire might ask the following:

Ask: What is the definition of Condition of Transport in relation to a HUD property?

Answer: It could indicate something very simple, such as the following: For a property to be in Transferable Condition, as far as foreclosure clearance is concerned, the property must be undamaged (not damaged by flood, fire, hurricane/tornado, boiler, etc.); the grass must be cut; the property must be sufficiently winterized; all debris and hazardous and unsanitary materials must be removed; and the property must be efficiently protected and secured, including all pools and hot tubs, at a minimum.

Another sample question you might find on a test might be the following:

Ask: Describe in detail the steps to take when winterizing a property with a dry heat system.

Answer: Dry Heat Systems. The hot water heater and all domestic water supply and distribution lines must be sufficiently drained to prevent freezing and other damage. All valves and taps must remain open during the process. (After drainage is complete, they should be closed.) An adequate amount of antifreeze must be placed in all accessory traps, including toilets and tanks.

To set yourself apart as a potential foreclosure cleanup subcontractor, you could provide more detail in your response. For example, using the previous winter preparedness question, you could elaborate on the answer by describing winter preparation requirements in greater detail by drawing information from HUD’s guidelines (which can be found fairly easily by searching the Internet).

For example, you could include the following in your response:

Answer — Generally, properties must be winterized once between October 1 and March 31, although there may be exceptions based on local requirements. Unless otherwise specified, winterizing should include flushing toilets and draining all heating and plumbing systems sufficiently to prevent damage and freezing. Air pressure, or in some cases antifreeze, can be used to clean the system and prevent it from freezing.

All tasks must be performed in accordance with local and state codes and regulations. Before and after photos, along with other supporting documentation, must be submitted for reimbursement.

More sample questions

Here are a few more sample questions you may run into when taking a foreclosure cleanup subcontractor test (see if you can find the answers online yourself):

During a garbage collection, you notice a motorcycle in very good condition in a detached garage. What should you do?

When does the lawn mowing season start and end in your geographic coverage area?

Describe the services performed during a formal garbage collection?

What steps should you take if you arrive at what is supposed to be a vacant property with a warrant to secure it and discover that it is occupied by someone?

All of the answers above can be found in the HUD Guidelines, which, again, can be found quite easily online.

Don’t let a quiz put you off

Although many of the larger and more formalized companies require you to fill out a questionnaire to register your foreclosure cleanup business with their companies, many do not. So do a search on the internet, and if a company seems to be a good fit for your business in terms of services and geographically, don’t let a questionnaire stop you from registering as a potential subcontractor for their company.

Forging partnerships is the key to growing your business

Do your research and attack the quiz with fervor. As a smaller foreclosure cleanup company, getting work outsourced through the larger preservation companies serving your area can exponentially increase your bottom line.

Many of these larger companies often service hundreds of properties at the same time, in multiple states. Forging a partnership with the largest property preservation company is the key to truly growing your foreclosure cleanup business.

Best wishes for success with your foreclosure cleanup business.