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Foreclosure Cleaning: How Much Money You Can Really Make In This Business

Work is beginning to pour in, in large numbers, at foreclosure cleanup companies, as evidenced by the August 9, 2009 MSNBC article, Foreclosures Bring Cleanup Crews. The article describes the owner of a property maintenance company.

Note: Property preservation companies perform many of the same functions as foreclosure cleanup companies, ie tearing up properties, winterizing properties, maintaining lawns, etc.

A Typical Week in the Life of a Foreclosure Cleaning Business Owner

If you’ve ever wondered what a work week looks like for this type of business owner, the entrepreneur described in the article gives you a good idea. He says that he . . inspects approximately 90 structures, insures another 20, and vandalizes 10-20 “REOs” (banking abbreviation for “real estate ownership”).

Why this business is booming right now

Foreclosures: Obviously, this is a big part of why foreclosure cleanup and property preservation businesses are booming right now. The nation has been in a foreclosure crisis since late 2007. And the crisis continues, even in 2009.

According to the February 2009 CNN Money article Obama’s foreclosure settlement underway, “More than a million homes are already in foreclosure, and more than 2 million are expected to succumb this year.”

Staging!

And, the longer a house remains, the more problems it presents, on several fronts, that is:

Bank Delays – When a home goes into foreclosure, banks have to process paperwork before any work can be done on a property. In a normal foreclosure market, this process can take a few weeks to a couple of months at the most.

In this market, it can take six, nine or more months, even more than a year in the hardest hit states like California and Florida. And what happens in the meantime?

The house is settled, susceptible to mold, vandalism and other general deterioration that occurs when a property is “abandoned”. Abandoned is in quotes because that’s essentially what happens until the mortgage holder/lender (usually a bank) can come in, do an inspection, and start providing ongoing maintenance.

And this is where foreclosure cleanup companies come into play. By the time they arrive at a home, there’s no telling what they’ll be dealing with: rotting trash, debris and personal belongings, rodent infestation, mold due to water damage, etc.

And, this is what makes it so lucrative.

How much money do foreclosure cleanup companies make on a typical job?

According to the property preservationist in the article mentioned above, on a typical foreclosure junk removal job, you make between $250 and $2,000. Remember, you do 10-20 of these a week. A quick run of the numbers brings your weekly gross income to between $2,500 and $40,000 (yes, $40,000!).

Not bad for giving away your “raggedest jeans, T-shirt, and fishing cap.” [and lacing up your] thick-soled Timberland.”

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