Is it true I can make money by cleaning foreclosed homes? - NBC40.net

Is it true I can make money by cleaning foreclosed homes?

Updated: Aug 31, 2011 03:24 PM EDT
The foreclosure clean-out business has been spawned by the ten-fold increase in foreclosures in the past two years. (&copyiStockphoto/Thinkstock) The foreclosure clean-out business has been spawned by the ten-fold increase in foreclosures in the past two years. (©iStockphoto/Thinkstock)


By Elaine Zimmermann

Renee: I have heard people can make to $10,000 a month with a foreclosure clean-out business. Is that true? If so, how do get I started?

Elaine: Yes, it is true. I have contacted several people around the country and found that people are making a good living doing foreclosure clean-out work. Many are also offering their services for the repair work needed on these houses and the regular lawn care required. They can charge around $1,500 for a major clean-out depending on the state of home. They clean-out 10-15 houses a month which can generate a good monthly income.

According to Tony of Tidy Dwellings, "We get all of our foreclosure clean-out jobs from Fannie Mae. But we have been in the business more than a decade. "  

Experts suggest those who want to enter the business should contact realtors who specialize in foreclosure homes. They can be found on sites such as www.foreclosuresus.com. They suggest the new business owners call the realtors who list foreclosures in their area and ask to bid on the foreclosure clean-out work.  

The foreclosure clean-out business has been spawned by the ten-fold increase in foreclosures in the past two years. Banks and financial institutions are overwhelmed with the properties that they own and must dispose of. But before they can attempt to sell these homes, they must be "presentable" for sale and properly maintained while on the market.

Foreclosed homes are often filled with furniture, toys and even clothes. Many former residents load their car and leave most of their belongings behind.  It can take a crew of 2 or 3 men an entire day to remove and clean a home in this state.  

To price a clean-out job, use the Fannie Mae pricing guidelines for the removal of debris in and outside the home. Using these guidelines when you bid on a job will guarantee you are bidding along industry standards. These guidelines can be found on www.foreclosuresus.com and on the Fannie Mae site under Property Preservation Matrix section.

Some highlights of the matrix include, "cleaning out a refrigerator or stand-alone freezer $100, cleaning a toilet $75 and debris removal $40 per cubic yard." Experts explain the homes must be clean and tidy but not at the level of a maid service. Also homes must have lawns maintained on a regular basis and the home must be winterized.  

Again according to the matrix, when lawns are less than 12" in height the fee is $100 for the first 10,000 square feet of mowing and increase incrementally. Each heat and air-conditioning unit depending on whether it is steam, radiant or central brings a $100-$250 fee according to these same guidelines.

Securing the homes with lock changes on doors and repairs to window locks is also outlined in the guidelines of fees. They range from $25 to $250.

Personal identification items or valuables left by former residents are to be given to the contracting agency or realtor.

Elaine Zimmermann is a personal finance expert who was written about everyday ways to save money on cars, homes, vacations and more. For information on investing in foreclosed real estate you can visit her website at www.AskElaineZ.com.

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