# My start up plan



## Guest (Dec 8, 2011)

Hi all, I have been thing about getting into Reo and P&P business. I went to a voc.tech then college for light rez. construction and have been doing remodeling (job super) for 15 yrs. At this point in my life I feel like I just need a change. Over the past few weeks I have read all of the posts in this area many times. Please tell me what you think of my plan.
First of all I own generators, compressoers, ladders, 3 chain saw, mowers, trimmers, and every carpentry tool you can think of. I also have a private investor who has offered me up to 30K to get started. For collateral they have accepted a large parcel of land I own. The plan is to start a LLC in CT. and be based in MA. I would be looking to get a loan for a 3/4 ton diesel truck and buying outright a dump trailer. This way I could use most of the 30K for start up costs and working capital. I have a mentor/friend who is in the biz. and would want to work for me. At this time he runs crews and takes the pics. for a different p&p company. We would get started with just the two of us and if I could make it work the plan would be hire one or two more people. Run a 4 man crew for a while then start a second crew. I have a hand full of local realitors I know on a personal level I could turn to while I try to get in with a national. I have no doubt that I will have to be pounding the pavement with the local realitors and constantly on the phone and passing out information.
SO with that being said what do you pros think? Any pointers, help, or general directions would be great!!!! Thanks


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## Guest (Dec 8, 2011)

*good luck*

You should have no problem getting any work in Massachusetts.

I am literally swamped in Mass and I keep turning it away,I have been picking and chosing my work orders.

Are you ready to drive your 3/4 diesel truck 40 miles away for a $25.00 door lock change

50 miles for $20.00 trip charge

Take this into consideration before jumping into this.I have yet to get more than 30 per c/y in mass.

I can help you get into a couple regionals up here but the money is not great.Bid work is awesome but I have to take alot of low endwork before I get these bid jobs.

Start a mowing company and a handyman company instead of this.

P.s 

FAS and Safeguard are all lcoked up in Mass.

Springfield Mass and worchester are real busy I have 5 work orders I can throw you,but bring some heat


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## Guest (Dec 8, 2011)

Great plan.......but,
Joe Blow is around the corner willing to undercut your prices by a long shot. If you read enough of these posts you will see some people who have been doing this for a while want out...BADLY! This business has hit the crapper from 6 years ago. Most of the companies out there are not paying what they were before, and the good ones have solid contractors that aren't giving up their spots. If you must endure this profession, best of luck.

IMHO, if you are stable in what you are doing now then keep doing it.


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## Guest (Dec 8, 2011)

I looked at his plan and said why not start a handyman/lawn services.

If you know realtors I would have assumed they would tell you to run,I was under the assumation all realtors soon will have to go to nationals.


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## Guest (Dec 9, 2011)

MKM Landscaping said:


> I looked at his plan and said why not start a handyman/lawn services.
> 
> If you know realtors I would have assumed they would tell you to run,I was under the assumation all realtors soon will have to go to nationals.


Thanks for the input and offers MKM. But at this point Iam not 100% sure I want to pull the trigger on this plan. If it sucks so much why do you continue to do it? As for the 20 mile lock changes I have a 1/2 ton that can eek out 19-20 mpg. As it is now for my employer I travel 80-100 miles per day and front the money for fuel. Only to get rembursed months later. My long term goals would be to have clean outs as part of my biz. I would like to branch out to plowing, lawns, handyman, and landscape construction. I was just thinking that clean outs would give me a place to start from. It would also give me something new and exciting. I already work from dawn to dusk 6-7 days a week. The work doesnt bother me. But I have come to the conclusion that being a employee will not get me where I want to be in life. Thinking maby its time for some calculated risk. 
Do you recycle much of the material you haul and how important is it to have a yard for storage?


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## Guest (Dec 9, 2011)

i do the work because I have alot of full time employees that need to stay busy.I think this industry is tough but I don't think it sucks.

The problem is,this industry take years before you are successful.I have spread my wings out far for the last year and now I am starting to see rewards.The firsy 6 months was brutal being out 50 large but now i am getting check each week and it made it easier.

2nd most of landscaping and snow plowing is all national so I know how the scene goes.

National equal bulk work= low money
Local equal less work = lots more money

I just refuse to downsize or layoff.I care too much.

I don't recycle much but I don't do many trash outs.30 yard dumpsters up here are 800.00 too much money.I only do trash outs where dumpsters can put on sight,so I dont do many because I am not trying to work for 20 to 30 per c/y.


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## Guest (Dec 9, 2011)

Its sounds like you are a good guy to work for :thumbsup:. I take it in your first 6 months it was tough because you were the untested new guy? How long ago were you the new guy and at first how frequent were the jobs coming in? What type of work were you getting? Thanks again for the input!


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## Guest (Dec 9, 2011)

My first jobs where mostly trip charges,re keys,maids and lawns that looked like jungles.Took about a month of these jobs.

Got a invite to bid on big rehab,did great job and I know I shouldn't say this but Chase feel in love with my work and my prices and picked up a bunch more rehabs for them.

Took on some low paying routines 2 hours away and after 2 months received 40 of them that are now local.I love my routines,always a extra at each property.

i do a lot of board ups in Massachusetts.I have a regional who has crappy prices but pay threw the roof on board ups.

Just alone i ndecember we have already done 20 board ups and then you get the extra glass clean up,and the re clean and etc.

The other veterans make way more moeny than I do and have alot more info that I do.I am only speaking off Massachusetts.
I have a company who keeps calling for a bunch of work in western mass I just don't know how good they are yet.

Man if you have a guy willing to back you up 30 large jump in and get your feet wet.

Nobody ever dreamed of the schoolgirl nerd we all dreamed of the prom queen,winners get the prom queens.

My prom queen had 3 kids with me so my days are over off jumping in


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## BPWY (Apr 12, 2012)

MKM Landscaping said:


> i do the work because I have alot of full time employees that need to stay busy.I think this industry is tough but I don't think it sucks.
> 
> The problem is,this industry take years before you are successful.I have spread my wings out far for the last year and now I am starting to see rewards.The firsy 6 months was brutal being out 50 large but now i am getting check each week and it made it easier.
> 
> ...









> most of landscaping and snow plowing is all national so I know how the scene goes.



You must live and work in a huge metro area.

Because other wise most of the work out there isn't tied up with a national. There are far more home owners and small businesses that manage their own site than what go thru a nat.

In all my years of grounds maint I've yet to run across a national controlling the grounds maint.


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## Guest (Dec 9, 2011)

Buy a truckmount carpet cleaning system that does both carpets and tile and hit the street knocking doors. You will make a ton more "take home $$" than you ever will doing the P&P business and a lot less headaches. 

In the P&P business you are NEVER truly self employed and the Companies still control your destiny. 

JMO


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## Guest (Dec 9, 2011)

A BIG Amen to that Freemont! If nothing else you are simply a glorified employee who gets to proudly say you are a "contractor". If they say jump, you better be willing to say how high? Don't forget no such thing as a day off in this biz, you'll need someone to answer the phone or email at all hours of the day/night. Vacations are pretty much non existent (unless you have a crew/second in charge you can trust to get the job done right and close out the W.O.'s). 
Simply put, even though you fee like you'll be taking the leap and plunging yourself into a road of prosperity....there are consequences. Your relationships both personal and professional will become strained (i.e. if you have kids/wife....forewarn them that there is now another family member that will be consuming the majority of your time, your friends...well plan to see much less of them) as this biz is a 24/7 commitment and only the strong survive. 

Just my .02


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## thanohano44 (Aug 5, 2012)

P3+ said:


> A BIG Amen to that Freemont! If nothing else you are simply a glorified employee who gets to proudly say you are a "contractor". If they say jump, you better be willing to say how high? Don't forget no such thing as a day off in this biz, you'll need someone to answer the phone or email at all hours of the day/night. Vacations are pretty much non existent (unless you have a crew/second in charge you can trust to get the job done right and close out the W.O.'s).
> Simply put, even though you fee like you'll be taking the leap and plunging yourself into a road of prosperity....there are consequences. Your relationships both personal and professional will become strained (i.e. if you have kids/wife....forewarn them that there is now another family member that will be consuming the majority of your time, your friends...well plan to see much less of them) as this biz is a 24/7 commitment and only the strong survive.
> 
> Just my .02


Exactly....


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## CSREO (Jun 16, 2012)

I would scrap the plan of spending the 30k on a truck and dump trailer. We started our first truck by buying a f250 from United Rentals for $3500 with only 48k on it, and bought a 15' dump trailer for $3500. Start with as few expenses as possible, due to the time it takes to get paid. Working with nationals will run you flat broke. If you have connections in with agents, go after them. We do not have one national, and yet we have ramained busy. More money, less headaches. Now we run a 15' dump trailer, 12' dump trailer, and 16' dump truck. Plus misc trucks for contracting type services that have misc tools and supplies kept in it.


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## mtmtnman (May 1, 2012)

FremontREO said:


> Buy a truckmount carpet cleaning system that does both carpets and tile and hit the street knocking doors. You will make a ton more "take home $$" than you ever will doing the P&P business and a lot less headaches.
> 
> In the P&P business you are NEVER truly self employed and the Companies still control your destiny.
> 
> JMO



I'll add to this by saying you should get equipment to refinish hardwood floors. We are seeing more and more people ditch carpet for hardwood out here. Some of these 50-60's homes have BEAUTIFUL hardwood under the carpeting. A little refinishing and they look like new. Carpeting is on a downward spiral here. I'm ditching all the carpeting in this house when we finally purchase it due to the wifes Allergies..........


A little info here:

The changing of the generations could also contribute to a continuing shift to hard surface flooring. In 2007, _*Generation Y was more likely to purchase hard surface flooring and area rugs, while Baby Boomers and older generations are more likely to purchase wall-to-wall carpet.*_ This trend indicates that the flooring market could increase its dependence on wood and laminate flooring, vinyl sheet and floor tile, and ceramic tile over the next decade. Currently however, Generation Y may prefer the lower-end lines of these markets, since their incomes are probably lower than their older cohorts.

http://blog.floorcoveringinstitute.com/2009/11/floor-covering-trends-target-generation.html


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## thanohano44 (Aug 5, 2012)

mtmtnman said:


> I'll add to this by saying you should get equipment to refinish hardwood floors. We are seeing more and more people ditch carpet for hardwood out here. Some of these 50-60's homes have BEAUTIFUL hardwood under the carpeting. A little refinishing and they look like new. Carpeting is on a downward spiral here. I'm ditching all the carpeting in this house when we finally purchase it due to the wifes Allergies..........
> 
> A little info here:
> 
> ...


I just ripped out all the carpet of my rental to lay tile. It's too damn expensive to keep replacing and cleaning carpet. Just get a damn throw rug. 

I'm going to do it in my house later this month. You'd be surprised what you can get at EOM and EOY from distributors. Lol.


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## BPWY (Apr 12, 2012)

After our fire in 08 our new modular is 100% vinyl.

We plan to do tile and laminate on top of that in some of the rooms.


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## Guest (Dec 10, 2011)

I highly recommend woven bamboo! Just laid it throughout my own house this summer and this stuff is TOUGH. I have 2- 150lb dogs and they can't scratch it. A little more expensive than oak, but right in line with the cost of maple or another exotic hardwood. I wouldn't go any other way after laying these wide 6" planks. 

Mi Casa


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## mtmtnman (May 1, 2012)

P3+ said:


> I highly recommend woven bamboo! Just laid it throughout my own house this summer and this stuff is TOUGH. I have 2- 150lb dogs and they can't scratch it. A little more expensive than oak, but right in line with the cost of maple or another exotic hardwood. I wouldn't go any other way after laying these wide 6" planks.
> 
> Mi Casa



Where seeing a lot of that up here in new construction and remodels and a hell of a lot less carpeting...............


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## Guest (Dec 10, 2011)

P3+ said:


> I highly recommend woven bamboo! Just laid it throughout my own house this summer and this stuff is TOUGH. I have 2- 150lb dogs and they can't scratch it. A little more expensive than oak, but right in line with the cost of maple or another exotic hardwood. I wouldn't go any other way after laying these wide 6" planks.
> 
> Mi Casa


Looks nice. I'm a hard surface freak, love tile and hardwood.


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## Guest (Dec 10, 2011)

It's the only way to go for indoor air quality. A lot of people are unaware of the actual carcinogens found in carpet. It's tainted with so many VOC's it's ridiculous. I'm not saying that there aren't any in hardwoods (because there are), but certainly less distributable than that of carpet.


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## Guest (Dec 10, 2011)

I like slate personally. When I finished my basement I installed 24" slate tiles and used a high gloss sealer.


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## Guest (Dec 10, 2011)

BigDaddyPin said:


> I like slate personally. When I finished my basement I installed 24" slate tiles and used a high gloss sealer.


I too like slate! I prefer it on back splashes and walls in baths. Installed it on my own kitchen last year and couldn't be happier with it. 

BDP - How does it hold up to foot traffic? Any of the edges delaminate from traffic? That was my one big concern about laying it in my own kitchen floor. Went with the bamboo throughout instead. 

I have yet to do my master bath...and seeing your slate laid out like that (especially the 2x2) makes me think that may be a good choice, it will really bring some natural color in. 

Much smaller version of what you have on your floors! I too went with a high gloss sealer.


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## Guest (Dec 10, 2011)

BDP...one other question. Did you seal the slate a couple coats before you laid the grout? If not...was it a PITA to get the haze up? I always seal any of the natural stones before grouting and then again after grout clean up.


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## Guest (Dec 10, 2011)

It's been down there for about 4 years now and looks like the day it was installed. We have had all kinds of parties with tons of foot traffic, pool balls bouncing off the tiles, kids smashing their toys against the floor, etc. I resealed it once about 2 years ago. As for the edges, I never had any chips or peeling at all. When I installed I made sure to check each one and peel off any loose or flaking layers, if you ever installed slate you will know what I am talking about.


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## Guest (Dec 10, 2011)

P3+ said:


> BDP...one other question. Did you seal the slate a couple coats before you laid the grout? If not...was it a PITA to get the haze up? I always seal any of the natural stones before grouting and then again after grout clean up.


YES! You MUST seal before grouting or the grout will stain and you will never get the stains out. I only sealed it 1 time before grouting, then 2 coats after grout, then 2 years later sealed again. It's been 2 years since last seal but still looks good, maybe in the spring ill seal again.


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## Guest (Dec 10, 2011)

I love cleaning tile/slate. Good pay. 

Bamboo? The flooring shops here are not selling much of it anymore due to the expansion problems...cracking. Good friend removed all bamboo flooring out of his store sales entirely. Seems to hold up good for a few years than boom. Warranty issues from the suppliers cuz they are inundated with claim


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## Guest (Dec 10, 2011)

Brent
Those issues around here (Iowa) were mostly due to improper installation. 3 years ago when it took off around here and got popular, most of the installers weren't using the correct nailer/stapler. Just like anything else if not installed properly from the start it will fail sooner rather than later. 
My first introduction to it was 2007 on a LEED cert. house we were building. The product has come leaps and bounds since then. The real problem is the people that don't pay attention to the product but rather the price tag. You get what you pay for in the flooring world...and that holds true from carpet, tile, hardwoods, laminate and the like.


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## Guest (Dec 10, 2011)

I'm sure some of the problems were from improper installation but not all.

Bamboo is being shipped from the factories way to wet. Just tested 2 weeks ago a batch that was reading 38%. That batch would have took a month to acclimate but if a homeowner purchased they would have installed and then.......6 months later would have been screaming about their floor. 

Bamboo is not wood (a grass product) and people don't realize that it is different when installing.

To use bamboo correctly moisture is the biggest concern. Most problems are when homeowners install their own. Bamboo will still be a "pushed product" since it is a quick renewal resource.

Looks good though....


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## mtmtnman (May 1, 2012)

FremontREO said:


> I'm sure some of the problems were from improper installation but not all.
> 
> Bamboo is being shipped from the factories way to wet. Just tested 2 weeks ago a batch that was reading 38%. That batch would have took a month to acclimate but if a homeowner purchased they would have installed and then.......6 months later would have been screaming about their floor.
> 
> ...



I would think Bamboo would not be so good in humid climates either.................


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## Guest (Dec 11, 2011)

To the OP. Do yourself a favor and keep your property. Don't borrow 30 grand to buy some big truck so you can change a lock every now and then and pick up trash and cut overgrown lawns. Why work for someone who is out to pay you as little as possible? What skills do you have?


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## Guest (Dec 11, 2011)

bluebird5 said:


> To the OP. Do yourself a favor and keep your property. Don't borrow 30 grand to buy some big truck so you can change a lock every now and then and pick up trash and cut overgrown lawns. Why work for someone who is out to pay you as little as possible? What skills do you have?


Well after having a few nights to do more research and think about my situation Iam starting to lean towards sticking with carpentry (15 yrs exp.) and starting my own remodeling biz. I dont think I could afford to drive around all day swaping out locks. I do have some more ?? tho. I found online a Mass. hud cost schedule. So I would assume that nationals pay less. How much less, 50%, 25%, depends on the national? Just looking for a general idea? The same goes with realitors are they inline with hud's numbers or higher? Just to be clear Iam not asking for exact #s, only trying to get a better idea how this industry works. Like I said Iam leaning towards sticking with remodeling but wondering if it is feasible to try to also work for some realitors.


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## Guest (Dec 11, 2011)

bigdifficultme said:


> Well after having a few nights to do more research and think about my situation Iam starting to lean towards sticking with carpentry (15 yrs exp.) and starting my own remodeling biz. I dont think I could afford to drive around all day swaping out locks. I do have some more ?? tho. I found online a Mass. hud cost schedule. So I would assume that nationals pay less. How much less, 50%, 25%, depends on the national? Just looking for a general idea? The same goes with realitors are they inline with hud's numbers or higher? Just to be clear Iam not asking for exact #s, only trying to get a better idea how this industry works. Like I said Iam leaning towards sticking with remodeling but wondering if it is feasible to try to also work for some realitors.


Nationals and regionals are all less , except for bid work. How much lower? Check Craigslist and see


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## Guest (Dec 11, 2011)

mbobbish734 said:


> Nationals and regionals are all less , except for bid work. How much lower? Check Craigslist and see


 Its that bad??


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## mtmtnman (May 1, 2012)

bigdifficultme said:


> Its that bad??


Unless your established it's worse than that bad. Even if you are established, there is no love in this business and a National will shut you down in a heartbead if someone underbids you. They don't give a crap about quality FOR NOW but when this low quality work hits their pocketbook things will change. I have been seeing more REO's conveying back to the bank lately due to hacks screwups and it's only going to get worse. Eventually when it hits there pocketbooks enough, prices will come back up and quality contractors will get back in but as it stands we are loosing good contractors by the boatload and they are being replace by broke hacks that can't afford to do the job properly.......


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## thanohano44 (Aug 5, 2012)

mtmtnman said:


> Unless your established it's worse than that bad. Even if you are established, there is no love in this business and a National will shut you down in a heartbead if someone underbids you. They don't give a crap about quality FOR NOW but when this low quality work hits their pocketbook things will change. I have been seeing more REO's conveying back to the bank lately due to hacks screwups and it's only going to get worse. Eventually when it hits there pocketbooks enough, prices will come back up and quality contractors will get back in but as it stands we are loosing good contractors by the boatload and they are being replace by broke hacks that can't afford to do the job properly.......


I've seen about 8 reo properties get reconveyed back to the bank. For both hack work and probably incorrect filing. I hope it happens more. Get the hacks out.


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## mtmtnman (May 1, 2012)

thanohano44 said:


> I've seen about 8 reo properties get reconveyed back to the bank. For both hack work and probably incorrect filing. I hope it happens more. Get the hacks out.




Funny thing is the ones you think would convey back never do. We had a Fannie Mae that conveyed this summer. I pumped the crawl and thawed the house. Told the bank over and over that mold would grow if the house was not properly dried immediately. (BOA) This was in January. When it conveyed in July it was full of mold. The broker asked for all of my original photos and notes. The servicing co. i did the work for gave me written permission to do so. Fannie NEVER did a thing about it. _* The thing is, the bank could have filed a claim on the homeowners insurance for the damages in the 1st place but they didn't!!! (insurance was escrowed and in force when loss occurred)*_ 

Until Fannie, Freddy, HUD Ect. start conveying back to the bank for screwups this will NEVER change. We are seeing more than usual re-convey but not nearly enough. I would guess that nearly 75% or more could potentially re-convey back to the bank for one reason or another........


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## Guest (Dec 11, 2011)

bigdifficultme said:


> Well after having a few nights to do more research and think about my situation Iam starting to lean towards sticking with carpentry (15 yrs exp.) and starting my own remodeling biz. I dont think I could afford to drive around all day swaping out locks. I do have some more ?? tho. I found online a Mass. hud cost schedule. So I would assume that nationals pay less. How much less, 50%, 25%, depends on the national? Just looking for a general idea? The same goes with realitors are they inline with hud's numbers or higher? Just to be clear Iam not asking for exact #s, only trying to get a better idea how this industry works. Like I said Iam leaning towards sticking with remodeling but wondering if it is feasible to try to also work for some realitors.


What kind of carpentry do you like? I really hated doing trim when I started remodeling, but have started to accept it:laughing: I say you got to do what you got to do to pay your bills. Man I think anytime you are setting your own prices to do work is always better than letting someone tell you what they will give you. Of course, there are times when you are offered a price to do a job that is acceptable. There are soo many people that invest their whole life savings into a business an loose it all. If you got enough to get started on your own try that first and go for a loan as last resort. Carring a mountain of debt is not very fun. I am not out to own a business. I am out to make money.


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## Guest (Dec 12, 2011)

The $ is with the real eatate agents/brokers that handle reo's. You might only get a couple of jobs per month from each but the profits are much better than nationals.


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## Guest (Jan 9, 2012)

We all hope! I hope that the nationals that want the waivers will run out of contractors. and more contractors will say no to nationals E&O contracts. maybe then we can take back some pride, get pricing back up to old levels, and do quality work again.its hard to keep standards high when your going broke. we all know that they are bank owned dumps. but we like to treat them like any other property. its hard to when a national gets twice what you do for (out of the kindness of there hearts) give you the work. 

We are the guys/girls doing the labor, paying for gas, trucks, dump fees, insurances. then hoping we didnt forget a DATE STAMPED photo. or get charge backs from months ago, or E&O insurance (open check book)


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