# Bank Owned Prop. Contractor Does Not Know The Players for the Contract.



## bambambam (Nov 16, 2008)

I am confused. My experience to date is working directly with homeowners.

Scenario:
Get a call for competitive bid. Two guys meet me there with a list of many bankowned homes. Find out it is a BankOwned home empty with an non-permitted addition that needs to be removed hence my license to pull demo permits etc. ( I called the city building department in charge of the house..and the lady in charge says yes the house has the code violation for correction..and she is similarly confused on who owns the property because points of contacts and different real estate agents come and go) We agree on price. They say they are partners of a property preservation company but offer no card. They say they need to get the price approved. One week later they say it is approved. I say I need a company address etc for the contract. They say use his personal home address, and that they are the only point of contact. 

My questions:
Do I need to now the banks name?
How am I assured that these guys are actually even tied or legally able to contract for this property?
My first time dealing with Bank Preservation Companies. Are there standard contracts for these deals and terms and agreements?

My concerns:
My impression so far is that these guys somehow made a personal side deal as BUSINESS PARTNERS to bid jobs and manage projects for a small property preservation company. They receive lists of bank owned homes that need work. I look on line and the company pops up on linkdin.com as an llc with one principal owner no web site and no phone number.


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## Mrmac204 (Dec 27, 2006)

well it seems that your bat-senses are tingling, so that's a clue. Dig deep! doe's the bank actually own this house? did the bank authorize this reno?

I think you are right to question this whole thing.


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## bambambam (Nov 16, 2008)

*I would assume I need to know!*

I assume I would need to know the principals:
Owner of home such as bank name.
Order from owner to do such work in writing.


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## thom (Nov 3, 2006)

You need to clear something up. You say you got called to bid a demo job and your trade is homeowner. That really doesn't cut it. 

You should only contract with a responsible party. At this point, you don't seem to know if the guy who wants to hire you has any legal interest in the property. Maybe he's a disgruntled friend, former contractor, neighbor, etc and just wants you to go damage the house for him. 

If you contract with this guy, not even a company, how do you get paid? Who pays you?


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## JonM (Nov 1, 2007)

Time to go see your Town/City clerk and look up the records. :thumbsup:


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## mikeswoods (Oct 11, 2008)

Sounds like you are sitting in the 'chump' seat. I sure wouldn't demo a building without the actual owner signing off on the work.

These guys sound kind of odd to me.


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## griz (Nov 26, 2009)

Do you have the appropriate license to do this work?
If so you need to find the legal owner of the property and determine their intentions. City/County records for legal owner, Building/Planning for illegal addition. Dealing with guys that are acting shady etc I think I'd find something else to do.


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## pcplumber (Oct 12, 2008)

*Don not even think about doing this job!*

You will not get paid one penny.


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## festerized (May 19, 2007)

First thing first: Ask for property survey from your client. If the client cannot produce a survey chances are they don’t own the property and you cannot sign a contract with them
Second go to the township building dept. and get a copy of the tax records to see who actually owns the home. You can also ask if there are any liens on the home too


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## Brickie (Jun 15, 2006)

Bambambam,

I deal with bank owned properties all the time doing property preservation work, repairs, etc.,

Something doesn't sound quite right with those 2 Israeli guys & the whole thing as you described.

As far as finding out who actually owns the property, I go to the county recorders office.


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## wireless (Nov 2, 2006)

where are you located?


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## brm1109 (Oct 28, 2008)

This whole thing doesn't sound right at all. I always go by my gut feeling. If for any reason my gut tells me to doubt a job then I just don't do it. Better not to do a job and maybe lose $5,000 or so then to do it and have it costing you 10 x's that much.


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## bambambam (Nov 16, 2008)

*So thanks for all this advice*

They keep on calling me. They want me to do this work. They say my bid was approved ...now my question is by who???? 

They don't want to offer the business address of the property preservation company they say they are business partners with. The company is on linkdn.com with a business owner. But no contact information and it is an property preservation company with an llc and little backround info or anything.

How can I call their bluff and actually know that there is real order from a bank that says this XYZ property preservation company is supposed to contract out this project?

I am in Southern California


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## griz (Nov 26, 2009)

There's a reason, what ever it is, they are not being upfront with you. If you're having this much trouble getting property info etc out of them how the hell are you going to get any money. Next time they call tell them you are no longer interested in doing the job. Just how many red flags do you need to walk (run fast) away from this one? What kind of lic do you have? How did they get your name? Your trade being listed as homeowner seem rather suspicious, are you the one in trouble?


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## Fence & Deck (Jan 23, 2006)

Insist on a deposit, then a progress payment when you start. If not, well: no tickie, no washie.

It smells. If they refuse to tell you who owns the property and who wants the work done, well, what do you think your chances of getting paid are?
They keep calling you becuase for whatever reason they have to get it done, and no one else has agreed.
I'd walk in the other direction. Quickly.


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## BaltimoreGuy (Jan 17, 2008)

Another thought is to ask them to put funds in an escrow account. at the very least you need some sort of proof of funds in addition to proof that you are enterring into a contract with a party with the legal ability to contract work for said property.


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## griz (Nov 26, 2009)

Maybe the "Don" is sending a couple of mild mannered goons to send a message. RUN either from this job or the goons:hang::hang::hang:


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## Darwin (Apr 7, 2009)

Contract should be with the folks holding the checkbook --the Property Preservation Company/Property Owners. However, sounds like the checkbook holders are trying to absolve themselves of a commitment.

Who will you sue when they refuse to pay? Lien who?


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## Brickie (Jun 15, 2006)

bambambam said:


> They keep on calling me. They want me to do this work. They say my bid was approved ...now my question is by who????
> 
> They don't want to offer the business address of the property preservation company they say they are business partners with. The company is on linkdn.com with a business owner. But no contact information and it is an property preservation company with an llc and little backround info or anything.
> 
> ...


 
Like I previous posted, I deal with bank owned properties almost on a daily basis. These guys are scamming you.


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## Mike Finley (Apr 28, 2004)

bambambam said:


> How can I call their bluff and actually know that there is real order from a bank that says this XYZ property preservation company is supposed to contract out this project?
> 
> I am in Southern California


Wouldn't the first thing to be to ask for a work order with all the proper information on it?


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## andydallas (Feb 6, 2010)

wouldn't requring credit information for the company responsible for payment be 'normal' under this situation,,,so if its bank owned, and the bank approved your bid,,there shouldn't be a problem getting credit info (signed) by someone from the bank, something tells me they will baulk at that, if so run


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## WarnerConstInc. (Jan 30, 2008)

No money, no honey. Some one is trying to pull the wool over your eyes.


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## FremontREO (Sep 30, 2009)

We deal with bank owned properties daily and hire a lot of subs to do work and handle a lot "in house". We largely deal with demo and rebuilds and you need to ask for a copy of the approved work order. Normally we pay 30%/30%/40%. 30% up front, 30% when around half done and 40% upon completion and permits are signed off on but this largely is determined by the scope of the job. Its not abnormal for the sub to not know where or who the bank is. If the party wanting to hire you does not want to share this information with you or agree to up front expense payment then I would feel a little more than uncomfortable and would run as fast as you can. On the other hand if the LLC wanting to hire you and they "pan out" then you can earn a lot of work. Building a relationship is hard to do and unfortunately can cost ya so just be very careful.


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## bambambam (Nov 16, 2008)

*scenario*

FremontREO.

So openly I wonder how fast someone can ""decide"" to be a property preservation company...create an LLC overnight.... go get a business license with the city..then use back room personal relationships to have this master list of these bank owned homes that need work...in the area....get contractors to bid out jobs then mark them up...manage and pay the contractor if they feel like it or not...or create so much interference that the contractor does not collect his money...then the contractor never can go after anyone because the LLC is the money manager for the bank...does the bank in this case have any liability to the contractor..not to mention lean rights...


You said it was not uncommon for the contractor not to know the bank involved or see a work order from the bank...Question..is there always a bank and a work order on file for a real project handed over to a preservation company?

What actually is a preservation company in this day and age?

If you can respond I would appreciate it!

Thanks


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## AustinDB (Sep 11, 2006)

if this guy gets a signed contract from the two mystery men, does the job legally then the bank finds the work was done on the property which was NOT authorized, whose door do you think the police will knock on when the police report is filed (for insurance purposes)? 

I dealt w/ a party and realtor on a project where the items to be corrected were necessary in order for the new purchaser to get the mortgage-the bank (in this case) would not allow any work at all to be conducted on the property. The bank ended up selling the property to a flipper as-is for 10-15% less than the first party. Point is, get authorization from the bank in writing to perform the work.


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## Pearce Services (Nov 21, 2005)

The reason they are not giving info out, may be more to protect their arrangement. If these guys are marking you up, and doing nothing else, the last thing they would want is for you and the owner to enter into a contract directly.

as stated above, CYA, get deposits, permits signed by an authorized representative of the owner, and a formal work order.

I have never heard of anyone getting a notary stamp on a permit application, but it may help to have added protection, and a little traceability, should you need it.


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## FremontREO (Sep 30, 2009)

bambambam said:


> FremontREO.
> 
> So openly I wonder how fast someone can ""decide"" to be a property preservation company...create an LLC overnight.... go get a business license with the city..then use back room personal relationships to have this master list of these bank owned homes that need work...in the area....get contractors to bid out jobs then mark them up...manage and pay the contractor if they feel like it or not...or create so much interference that the contractor does not collect his money...then the contractor never can go after anyone because the LLC is the money manager for the bank...does the bank in this case have any liability to the contractor..not to mention lean rights...
> 
> ...


Well thats a loaded question.  Pearce Services is correct partially. The Property Preservation company has a signed contract with either the Bank or a Bank Servicing Company to handle bank owned properties. They will have an approval work order from the bank/service company. I have never heard of a "master list" of bank owned properties-yes I know they are out there but I have never heard of a P&P company just going out and bidding to do work off a master list.. The Property Preservation company does mark up the subs bid in order to cover the cost associated with doing business and that includes the notorius chargebacks that happen when a bank inspector doesn't like the look of your paint or they think you left a nail in the yard that is a hazard if someone steps on it so be sure you have a contract that the GC (property preservation company) covers all possible chargebacks since they are out of your control as long as the permits are signed off. 
As far as "going out and getting an LLC and starting a business"? Easy to do but very hard to "earn" the contract to get the rebuilding type of work since the service companies/banks seem to give this type of work to the Preservation Company that they know will "get the job done right". 
There is a lot of preservation contractors under the "hud and reo" forum on this site and someone from Cali should know of them and might be worth asking. 
Good luck. Make sure to get some earnest money if you have any doubts.


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## a1propertyclean (Dec 16, 2007)

I agree with Stone Mountain about requesting a deposit up front and see what their reaction is.

At the very least, you should be able to get a professional work order. It doesn't have to come from the bank but it needs to come with all the contact and billing info.

You can use the county assessors office to look up info about the property and most times it will tell you who the owner is.

Good luck but, as others have said, if it doesn't feel right, it probably isn't.

Linda


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## AmeliaP (Apr 22, 2007)

That sounds like a scam to me. Go check the deed info if you want to look into it. Many counties have it online now via the county clerk web site.


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## bambambam (Nov 16, 2008)

*What are the lien rights and how would that protect or scare them to be honest?*

If it is a banked owned house..some guys I meet ask me to do the work..don't see a work order directly from the bank...

Then I do it. I don't get paid or they play games. 

What would a mechanics lien do in this instance?


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## Tom Antoine (Feb 19, 2010)

I think I saw you were in California. What you need to do now, before you start work, is file a preliminary notice. That will flush out who the interested parties are. 

Also, I agree with the other posters that you need a copy of the work agreement. Tell your customer you need to review it to ensure funding is there and that you comply with all insurance requirements. I believe in being up front and that they should be cooperative with such a reasonable request.

I'm not licensed to practice law in California and suggest that you find a CA attorney if you need any legal advice. I know times are tight but I would not rely on a mechanics lien when you can do a couple simple things to protect yourself ahead of time.


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