Key Takeaways

  • Property preservation contracts define the scope of work and expectations when maintaining foreclosed or vacant properties for banks or asset management companies.
  • To secure these contracts, contractors must meet licensing, insurance, and registration requirements, and comply with federal agency guidelines (HUD, FHA, VA).
  • Common services include securing properties, winterizing, landscaping, debris removal, repairs, and code compliance.
  • Success in the field requires understanding pricing structures, payment schedules, and industry regulations, as well as building strong vendor relationships.
  • Networking with banks’ REO departments, asset managers, and large preservation firms can significantly increase job opportunities.

Property preservation contracts are documents that you will sign if you have been appointed by a bank to take care of a foreclosed property. 

Introduction to Property Preservation Contracts

It is common for banks to hire people to care for foreclosed properties. If you have experience with contracting, taking care of these properties can be an extremely profitable endeavor. You could either start your own contracting business or act as the representative of a property management asset company.

To start working preserving foreclosed properties, you will need:

  • Experience in the property preservation field.
  • Insurance coverage.
  • Your own vehicles and tools.

Before you can get work preserving properties, you will need to register with both asset management companies and banks, as these entities will only hire registered vendors. You will also need to follow contractor guidelines established by the Federal Housing Administration, the Department of Housing and Urban Development, and the Veteran's Administration.

When a bank forecloses on a large number of properties, it can be hard for them to quickly dispose of these properties, requiring them to preserve these properties until they can be sold.

You will need to be very proactive in marketing yourself if you want to be hired for property preservation. It's also important that you have the licenses and the ability necessary to do this work.

When a bank hires a property preservation company, their goal is to preserve a foreclosed property and maintain its property value until it can be sold. This also helps the bank comply with property maintenance and care ordinances. The conditions of foreclosed property can range wildly, with some properties only needing minor upkeep and others on the verge of collapse.

Some of the jobs you will need to perform as a property preservation specialist include:

  • Landscaping and lawn care.
  • Pressure washing the exterior of the property and cleaning gutters.
  • Upkeep of the property's interior.
  • Repairing damaged windows and other broken items.
  • Winterizing and painting.

If you want access to as many jobs as possible, you should offer a wide range of services. Even if you have a limited skillset, you can still offer a large number of services by hiring experienced employees. When you first start offering property preservation services, you can control your costs by only taking small jobs that don't require specialized equipment. You should perform market research to find out the demand for property preservation services in your area. As you add more services to your business, you will need to cover these services in your business plan.

Generally, banks do not retain employees to care for foreclosed properties. This is why typically contracting this work out to asset management companies or individuals with property preservation experience is recommended.

A bank's Real Estate Owned Department is responsible for handling the repossessed property. Contacting the Real Estate Owned department of lenders in your area is a good way to find property preservation jobs. If a bank has already hired someone for their property preservation needs, you can request that they place you on a waiting list for future opportunities. 

Qualifications and Requirements for Property Preservation Contracts

To be eligible for property preservation contracts, contractors must typically meet several industry-specific qualifications. These include having a valid business license, general liability insurance, and, in some cases, workers’ compensation coverage. Many banks and asset management companies also require vendors to pass background checks for all personnel entering properties.

Contractors should be equipped with reliable transportation, tools for general repairs, and safety equipment for hazardous conditions. In addition, some clients may require compliance with Occupational Safety and Health Administration (OSHA) standards. Registration with large mortgage field service companies or direct application to lenders is often necessary, as many prefer to work with pre-approved vendor lists.

It is also essential to maintain an understanding of state and municipal property maintenance codes to ensure that all work meets legal standards. Failure to 

can result in contract termination or legal liability for code violations.

Duties and Responsibilities

When you work as a property preservation contractor, one of your biggest responsibilities will be making sure the property you are managing is properly secured and remains unoccupied. To accomplish this goal, you may need to change the locks on the property and board up windows.

You will also need to regularly inspect the property for signs of damages so that you can schedule a repair. If necessary, you will need to winterize the property and schedule extermination if there is a pest problem. The utilities of the property will need to be shut down correctly, and you should frequently perform maintenance around the property, including lawn care.

The bank that hired you may give you something known as a Property Preservation Matrix, which will show you all property preservation tasks for which you are responsible. This is the payment you will receive for completing these tasks.

Getting in touch with your area's top property preservation businesses is the easiest way for you to find work.

Many of these large companies will hire contractors to handle preservation tasks such as:

  • Electrical work.
  • Plumbing.
  • Roofing.

Applying online with property preservation companies in your area can help you enter this lucrative field.

Finding and Securing Property Preservation Work

Building a strong network is key to securing consistent property preservation contracts. Contractors can start by registering with national property preservation firms that work with multiple banks and mortgage companies. Many of these firms list vendor opportunities on their websites, and applications typically require proof of insurance, licensing, and relevant work experience.

Direct outreach to banks’ Real Estate Owned (REO) departments can also yield opportunities, particularly in regions with high foreclosure rates. Joining industry associations, attending mortgage servicing conferences, and leveraging online contractor directories can further expand your reach.

Maintaining a reputation for reliability, quality work, and adherence to deadlines is vital for securing repeat business. In this competitive field, strong communication with clients, prompt submission of documentation, and adaptability to varying property conditions can set a contractor apart from competitors.

Common Services and Pricing Structures in Property Preservation

Property preservation contracts often list a wide range of services to be performed on a routine or as-needed basis. Standard services may include:

  • Securing the property by changing locks, boarding windows, and installing alarms.
  • Seasonal maintenance, such as snow removal, lawn mowing, and leaf clearing.
  • Winterizing plumbing systems to prevent pipe damage.
  • Debris removal, trash-outs, and hazardous material disposal.
  • Minor repairs to roofs, siding, windows, and interior fixtures.
  • Maintaining compliance with local ordinances and homeowners’ association (HOA) rules.

Pricing in property preservation contracts may be structured as flat rates per task, time-and-materials billing, or per-property monthly maintenance fees. Many companies use a “Property Preservation Matrix” to outline standardized rates for common tasks. Contractors should review these carefully before signing to ensure profitability and avoid unexpected expenses.

Payment schedules can vary widely, with some companies paying within 15–30 days after service completion, while others may have longer billing cycles. Understanding payment terms and keeping accurate documentation (photos, invoices, and work orders) is crucial for timely payment and dispute resolution.

Frequently Asked Questions

  1. What is included in a property preservation contract?
    A property preservation contract typically includes the scope of work, payment terms, service standards, compliance requirements, and liability provisions for maintaining foreclosed or vacant properties.
  2. Do I need a license to work in property preservation?
    Licensing requirements vary by state and municipality. In many areas, contractors must hold a general business license, and some specialized services (like plumbing or electrical) require trade-specific licenses.
  3. How do property preservation companies pay contractors?
    Payment terms vary but often range from 15 to 45 days after completion of work. Contractors must submit invoices, photos, and documentation as proof of service to receive payment.
  4. Can I work directly with banks instead of an asset management company?
    Yes, but it can be more challenging. Many banks outsource property maintenance to asset management companies, so building relationships with these intermediaries often leads to more opportunities.
  5. What insurance is required for property preservation work?
    Most clients require general liability insurance and may also require workers’ compensation coverage. Higher-value contracts may require additional coverage such as errors and omissions insurance.

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