# Trying to start business....Questions



## [email protected] (Feb 26, 2016)

Good Morning, 

I would like to know if: 

You had experience in the industry before you started? If so how many years?

Do vendors require contractors to have experience? If so how many years?

If you don’t have any experience what is your recommendation to starting off?

Do you have a business license? Or just insurance and DBA or LLC

What is the Best start off equipment in this season?

How must money is needed to get started? 

Also do you carry any home inspection license or certificate?

I would like to say thank you for any answers you can extend to me.


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## NickT (Nov 2, 2015)

Welcome Alexis! Most people on here know that I am a recruiter for a national repair/rehab company. I previously worked for a national (and a regional) preservation company. What I can tell you is this, most nationals and regionals do not care about experience. Most of them just want the job done fast and cheap. Before I started in this industry (on the processing side, eventually moving to field tech support, and now recruiting), I had no experience, nor did I even know what this industry was. Luckily, I am a pretty quick learner, and took in as much information a I could. I used to be able to quote the HUD Mortgagee letter, because I am a huge nerd. The reason I bring this up, is because I want you to know that the reps you are going to be dealing with, most likely will not have any experience in this field either, and that is something to keep in mind. There is a complete lack of experience on the office side (personally, I have done a few trashouts, initial secures, and evictions, but most have not even left the office). Before starting out, do your research, work out your expected overhead, and expect to lose before you start making money, as it is very possible. I'll leave the rest of the answer to the great people in the field here! I hope that helps a little though!


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## newreo (May 30, 2014)

Before you start, read this forum and then read some more than ask yourself question, do you really need it? 
Noone in their healthy mind should be getting into this industry specifically now and without experience in this industry. People with experience would not return into this as they know what this is


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## safeguard dropout (Apr 21, 2015)

Both of the above posts are right on. Think about the experience thing for a minute. The national/regional companies will ask/require you to perform multiple tasks that in most states would require licensing and certification. They do not care if you don't know what you're doing. If you happen to get it right, great. If you screw it up they will nail your insurance and move on to the next victim.

Newreo was right on. Read this forum until you want to poke your eyes out....then read some more, because in the end poking your eyes out will be more fun than losing your life savings invested in an industry that's full of thieves. 

I would never tell someone they can't do it. You can do it. What I would suggest is don't jump all in. Get your toe wet first. If it doesn't fall off, then get your feet wet.


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## david (Apr 11, 2012)

It just amazes me people still want to get in this business,truly baffeling.


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## RichR (Sep 22, 2012)

david said:


> It just amazes me people still want to get in this business,truly baffeling.


How would they know any different? Until they get on social media and hopefully retain what is spewed throughout the web on how bad things are getting, they have no clue that it's not a good direction to pursue.


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## Craigslist Hack (Jun 14, 2012)

david said:


> It just amazes me people still want to get in this business,truly baffeling.



Suck starting a revolver would be less of a headache.


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## hammerhead (Apr 26, 2012)

read read and read some more. when your done apply at McDonald's you will make more


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## Craigslist Hack (Jun 14, 2012)

[email protected] said:


> Good Morning,
> 
> I would like to know if:
> 
> ...



Serious question here. Why do you ask any of these questions when we all know you are just going to go ahead and make all of the mistakes we tell you to avoid? 

Are you wanting us to map it out for you? 

The bottom line is if you want to be a millionaire in this business start with 2 million and work your butt off. After about 18 months you will be a millionaire.


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## Newbie (Apr 17, 2015)

That may be true but I'm still bringing home 5 times as much as I did when I worked "for" someone like you.


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## Craigslist Hack (Jun 14, 2012)

Newbie said:


> That may be true but I'm still bringing home 5 times as much as I did when I worked "for" someone like you.



Are you? Or are you doing the extra work and bringing home more money which works out to the same wage?

I sent a 1099 to one contractor for just under 300,000 but make no mistake that's not what he made.


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## newreo (May 30, 2014)

Craigslist Hack said:


> Are you? Or are you doing the extra work and bringing home more money which works out to the same wage?
> 
> I sent a 1099 to one contractor for just under 300,000 but make no mistake that's not what he made.


He brings, alright and then he pays to his crews, for equipment, for insurance and has min wage left. 
We were making decent money before we left whole P&P thing, but these times passed. Well, we were mostly making it on rehab side of things 
We work private now, no P&P no rehab work


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## madxtreme01 (Mar 5, 2015)

You had experience in the industry before you started? If so how many years?

Do vendors require contractors to have experience? If so how many years?

Taking into consideration that you want to give this a shot and ignore anything that is going to be told to you that does not relate to your initial questions, I have decided to answer each of your questions individually and I would like to first say that I have been in the industry since 2008, I formed my company in 2010, and for the last 12-18 months I have been trying to work my way out.

If you don’t have any experience what is your recommendation to starting off? You have to start somewhere, try working for a local guy for a few months to get a better understanding as to what the industry is really all about. This will keep your costs down, but also your income. Sh*t rolls down hill, so if you do a job wrong, you will still have the same risk of getting an insurance claim, however the small local guy is most likely in the field with just a few subs, and could answer questions/help you along the way. This industry is more about pictures than the work and also how fast can you get the work done.

Do you have a business license? Or just insurance and DBA or LLC. - each state/municipality is going to be different so look into the laws of where you are located and where you are looking to work. Here in NJ I am required to have a business which could be a sole proprietorship, but an LLC protects your personal assets. I am also required to be a licenced general contractor if you complete more than $600 in home improvements in a year.

What is the Best start off equipment in this season? - that would really depend on the type of work you will be completing and where you are located. For most of us grass cut season is about to start, which means we become landscapers. I think I speak for everyone here when I say make sure you buy commercial equipment, home depot lawn mowers will not withstand the abuse that these properties will throw at it. Depending on your area you could me looking anywhere from 7-15k for a new lawn mower or 2-5k for a used one, but that will all depend on the size properties you will be maintaining. The best advice I can give is buy the basics (drills, hand tools, saws, generator, compressor, etc) that will get you buy until you need something else, and buy as you go along. The more expensive tools you might want to consider renting until you know for sure if this biz is right for you. Again just don't buy garbage equipment, it will cost you more in the long run.

How must money is needed to get started? That all depends on how much insurance costs, forming an LLC, are you renting an office?, how much equipment are you going to start with.

Also do you carry any home inspection license or certificate? - Some people might have this license, but personally I would think you are better off without it. You will not be paid appropriately for the inspections you will be providing, and possibly be held to a higher standard with the knowledge you have. Besides a lot of states will require on the job trailing before you can get a license along with schooling.

I would like to say thank you for any answers you can extend to me. - Any more ask away, but I have a feeling you will get chewed up and spit out before you give up, loose money because this industry is notorious for non payment for no reason, or whatever reason the company decides your work doesn't meet their requirements. I wish you lots of luck because you will need it. I don't think there is anyone on here that likes this business anymore and will tell you how great it is. Things have been steadily going down hill for years. Some of us roll with it and look for other ways to make up the rest, others get stuck at the bottom of the hill with the national on top of us and our bank accounts bone dry.


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## madxtreme01 (Mar 5, 2015)

I apparently forgot 2 questions

You had experience in the industry before you started? If so how many years? I started and got screwed by a local company, but then got lucky with a company that was starting fresh in NJ and needed help, that lasted until Safeguard took over most of the BOA work, and they jumped ship and so did I. I found work elsewhere.

Do vendors require contractors to have experience? If so how many years?
That would depend on what level you are applying. The nationals and most of the regionals only have a few requirements. Can you get the job done, can you take 100x more pictures than necessary to prove you did the work, can you do an obscene amount of unnecessary paperwork and bid everything in existence wrong with the property that will never be approved, and can you be the cheapest vendor we have. Don't forget if you miss something, they want you to do it at your own expense.


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## G 3 (May 3, 2015)

I usually don't (actually, it's extremely rare that I respond to questions like these), but I wanted to try to get ahead of the "Nellies". There are those who are so jaded in this business, that they instantly loathe any newb. I don't blame them, as this is a long gone business of respectable business practices, and honorable people. Who in their right freakin mind would want to get into this line of work? Nat/reg will cheat you most any way they can, and the newbs will cut as many corners as they can to make the numbers work. Both are unacceptable business practices. Don't take any of my advice to heart, as you need to do so much more research. These are just my business opinions, and that doesn't carry much weight here. Just an opinion to your questions. (I had a few extra minutes tonight to be a noble guy. That doesn't happen often...)

You had experience in the industry before you started? If so how many years?
I had no experience when I first got into this business, and worked for someone first. She screwed things up with her marriage, let the work lax tremendously, and everyone called me to take it over. 2 years later, I got out of the nat/reg work, and have local/private work.
 
Do vendors require contractors to have experience? If so how many years?
All they want is a warm body doing the work. Hell, they'll tell you to do things that are unethical or unsafe, to satisfy their own needs. Be careful.
 
If you don’t have any experience what is your recommendation to starting off?
Find someone who will hire you. Can't find someone? Find a different career.
 
Do you have a business license? Or just insurance and DBA or LLC
You better have insurance up the wazoo, and you better be at least LLC. You'll get claims on your insurance regardless how careful you are. Some states require a license, depending on what work you are going to be doing. Plumbing, electrical, and even some roofing requires a GC license.
 
What is the Best start off equipment in this season?
This is a funny question. What season are you talking about? Winter on the way out or spring on the way in? Would you buy just enough to transport your kids to the school play, or buy the most safe vehicle you can get? Cheap tools break fast, and are cheap to replace, but you better have a back up or two right there. I think you know the answer to this one. If you don't, you shouldn't be in this business.

How must money is needed to get started? 
What kind of work are you planning on doing? Can you realistically float each company 30+ days for help, parts, tools that break, gas/oil, dump fees, insurance on the business and vehicles, your own wages, etc... Thousands. 
 
Also do you carry any home inspection license or certificate?
Are you going/already certified/licensed in home inspections? If not, and you have no interest in pursuing that avenue, then no. Market dictates if you should go that route.
 
I would like to say thank you for any answers you can extend to me.
You can thank us by reading, re-reading, then reading again, everything on this board. You'll hear the "Why the hell are you trying to get in!" quotes, to the "Why the hell did you do it that way..." quotes. Keep reading.

Questions asked 40 million times by newbs who don't heed advice will pi$$ of the vets that you dearly need to query. Keep in mind that there are those on this board who don't know as much as they think they know, and will give bad advice. You'll see that in the posts. Time and time again, bad advice is either given, or described. I am not one of the vets here, and still read and re-read everything here. Befriend the smart vets, do some work ahead of time, pay attention, and I think the vets might come around and throw a few scraps your way.


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## GTX63 (Apr 12, 2012)

Be prepared for three things when doing preservation work outside of the public sector-

a. the client won't pay you.
b. the client will short your invoice.
c. the client after the fact will take money back from an invoice they already paid you for.

So, will you do the same to the sub/employee that worked by your side loading all of that trash and mowing that hayfield last summer?


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## oteroproperties (Aug 10, 2012)

One of the things that I think is often over looked is your geographic location. This is a bigger factor than most realize when determining whether or not you can or will make money. I'm in Florida. Here, you cut grass year round and still perform wints during wint season. It doesn't freeze here so even if you screw it up it probably won't cost you. That's a decrease in liability the guys in the north don't enjoy. Also, there are no basements here, no sump pumps, no boilers, etc. There was alot of new construction here during the boom so most of the properties were either newly built or rehabbed prior to the bust and inevitable foreclosure. Florida is a different world as far as preservation is concerned. 

Sent from my SM-N920P using Tapatalk


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## GTX63 (Apr 12, 2012)

Here is an example of a national, that we don't work with, that sent us an email yesterday-

Their work order was for a property 2 1/2 hours one way.
It was a trashout @ $15 per cubic yard. Above $250 bid it and wait. An initial sales clean for $65, smoke alarm install for $13, etc etc.
I stopped my office manager at that point and told her to just delete it.

If a John Doe answers your ad and says "I own this vacant house that has sat empty for 2 years. I need you to empty out part of the crap in my basement and clean the house so it is ready to show for a buyer, and install some alarms, oh and I live about 115 miles east of you. Can I just mail you a check for say, $300 and we call it a deal?" would you react the same as if it were MFS?

I won't bother with a cost breakdown since my math tells me it is better to start with a plus before you minus. And we all know you can't count your own labor the same value a subs cause we all are supposed to work for free as we make our fortunes in some other nether region.


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## All Island Handy (Dec 12, 2012)

craigslist hack said:


> suck starting a revolver would be less of a headache.


^^^^^quote of the day^^^^^hahahahaha


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## AceVentura (Sep 6, 2015)

I would like to know if: 

You had experience in the industry before you started? If so how many years?
It's good to have a background in doing labor everyday, carpentry, construction, plumbing, landscaping, etc. You should learn from experienced parties first before getting in, it will save "the LEGIT" the headache of cleaning up your messes.

Do vendors require contractors to have experience? If so how many years?

There is no reason as it is all just similar to a Ponzi scheme, they need to add fresh money some way some how to keep everything moving.

If you don’t have any experience what is your recommendation to starting off?

Get an hourly job for a Legit Contractor.


Do you have a business license? Or just insurance and DBA or LLC

Required by law, but with Ponzi Schemes do those adhere to the law?


What is the Best start off equipment in this season?

Heavy Duty / Professional grade otherwise you will be repairing / buying new shortly.

How must money is needed to get started? 

Min 40K on hand

Also do you carry any home inspection license or certificate?

You cannot perform repairs and inspections. it is illegal. (Conflict of interest)

I would like to say thank you for any answers you can extend to me.

Your Welcome


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## IPS (May 24, 2015)

*click it*

http://www.preservationtalk.com/showthread.php?t=9753


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## jjkriv (Feb 21, 2014)

I'm not gonna go through all your questions but I'll fill you in on my current situation with [email protected] work.I have been doing this work for 7 years and this is the worst decision I ever made. 1st-no matter how big your checks are,stick half into another account because taxes will eat you alive and if you fall behind with the IRS-game over! 2nd-Say goodbye to your personal life,retirement fund,health benefits,and so on because the money will simply not be there with the change in companies which will happen due to the low ballers moving in pushing out the good nationals dropping you into a worse pay scale. 3rd-Why do I stay and linger around?because I have too and a 9-5 job alone isn't gonna get me out of the hole I'm currently in which is-I lost my fiance,I'm currently sleeping at different places,my retirement is gone,pretty much bankrupt,and have IRS issues and its all because of this business...I'm not telling you not to do this but it can eat you alive and destroy happiness.


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## G 3 (May 3, 2015)

jjkriv said:


> 1st-no matter how big your checks are,stick half into another account because taxes will eat you alive and if you fall behind with the IRS-game over!


:vs_worry:

I don't understand this point. If you hire help and pay them as an employee, maybe. If this is the case, you should've clarified this to the OP so they don't take that information personally if they are working by themselves.

If you are a single worker, there is no way in hell that you should be paying upwards of 50% in taxes. As a business owner, there are so many tax breaks afforded to us that you should not be paying that much. Even with employees, the tax rate is not that high. You need a new accountant.


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## jjkriv (Feb 21, 2014)

I meant to say,save half for wear and tear on equipment, taxes,etc because the money runs out quick...no1 in their right mind knows no1 pays 50% in taxes..come on now...


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## madxtreme01 (Mar 5, 2015)

jjkriv said:


> I'm not gonna go through all your questions but I'll fill you in on my current situation with [email protected] work.I have been doing this work for 7 years and this is the worst decision I ever made. 1st-no matter how big your checks are,stick half into another account because taxes will eat you alive and if you fall behind with the IRS-game over! 2nd-Say goodbye to your personal life,retirement fund,health benefits,and so on because the money will simply not be there with the change in companies which will happen due to the low ballers moving in pushing out the good nationals dropping you into a worse pay scale. 3rd-Why do I stay and linger around?because I have too and a 9-5 job alone isn't gonna get me out of the hole I'm currently in which is-I lost my fiance,I'm currently sleeping at different places,my retirement is gone,pretty much bankrupt,and have IRS issues and its all because of this business...I'm not telling you not to do this but it can eat you alive and destroy happiness.



I'm not exactly sure who you were getting your work from, and how many invoices got cut, but I'm sure I can speak for most when I say that this is not the norm. Yes things have gotten bad, but you can still turn a profit if you have adjusted your business plan accordingly based on where you receive your work from and what your net profit is per job. Times are a lot tougher than they used to be, but without this business I would not be where I am today. I have never had more than 4 subs, I have never left my state to complete work, and I covered at a maximum about 70-100 miles from my home/office. My best year with being as small as I am, I cleared over 200k in net profit (not on paper, but revenue minus expenses and 1099 subs). Today things are nowhere near where they used to be, now I run a 1 man show except during grass cut season where I have 2 subs that cover the 2 surrounding counties and I cover my own. If I have a larger job where I need help, I pick up a guy that I pay cash for the day. We have decided that this business is not what it used to be and we need to get out before it gets worse (I'm not really sure if that's possible). I've started to go more towards private work and a completely unrelated business all together. I've sold off some equipment to gain some capital for my new venture and we will see what happens. I have passion in this industry but I can't work for free. I have 2 little ones to feed, clothe, and keep a roof over their heads.


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## Bigtrucker (Mar 18, 2014)

madxtreme01 said:


> I'm not exactly sure who you were getting your work from, and how many invoices got cut, but I'm sure I can speak for most when I say that this is not the norm. Yes things have gotten bad, but you can still turn a profit if you have adjusted your business plan accordingly based on where you receive your work from and what your net profit is per job. Times are a lot tougher than they used to be, but without this business I would not be where I am today. I have never had more than 4 subs, I have never left my state to complete work, and I covered at a maximum about 70-100 miles from my home/office. My best year with being as small as I am, I cleared over 200k in net profit (not on paper, but revenue minus expenses and 1099 subs). Today things are nowhere near where they used to be, now I run a 1 man show except during grass cut season where I have 2 subs that cover the 2 surrounding counties and I cover my own. If I have a larger job where I need help, I pick up a guy that I pay cash for the day. We have decided that this business is not what it used to be and we need to get out before it gets worse (I'm not really sure if that's possible). I've started to go more towards private work and a completely unrelated business all together. I've sold off some equipment to gain some capital for my new venture and we will see what happens. I have passion in this industry but I can't work for free. I have 2 little ones to feed, clothe, and keep a roof over their heads.



So your saying you wont work for BLM


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## madxtreme01 (Mar 5, 2015)

Bigtrucker said:


> So your saying you wont work for BLM



LOL, I'm their best contractor, I cover 6 states and am able to sub it all out. I only take 33% off of the top and 40% on all bid approvals. I have subs knocking down my door to work for me.


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