Many people want to start businesses, but are not quite sure what type of business venture to explore. The best type of business to start is one that has low initial start-up costs and low ongoing overhead. In this way, your company can grow “on its own.” One of the best business ideas in a down real estate market is to start a foreclosure cleanup business.

A foreclosure cleanup business is a solid business to start because (1) you can use the equipment you already have in your garage; and (2) you don’t need a commercial office space — your living room, basement, or dedicated area of ​​your home will work just fine. And the market is ripe for profit in this fast-growing industry. According to a recent report from RealtyTrac, an online foreclosure data reporting entity, foreclosure filings were reported on 214,927 properties in the US in the month of May alone.

Foreclosures equate to cash for startups in the form of lucrative jobs and contracts. Read on to find out why.

What is a foreclosure cleanup business and who are the clients?

First, what is a foreclosure cleanup business? A foreclosure cleanup business is primarily responsible for the maintenance and upkeep of homes that have been foreclosed on.

Who do they service? The main customer base of this real estate services business will be banks, mortgage companies, and property preservation companies looking to outsource work and jobs to smaller companies. A good list of real estate industry contacts and property preservation companies can provide a wealth of job opportunities and contracts for startups in the start-up phase. It is not uncommon for smaller businesses to receive numerous work orders once they successfully register with property maintenance companies as job and contract providers.

Basic start-up equipment needed to open your REO cleaning and junk doors

Foreclosure cleanup companies generally need the following equipment to get started: a lawn mower; leaf blower; edge; weed eater; rake; trailer (to attach to the back of a vehicle to transport debris) or a truck; ladder; measuring tape; cleaning supplies such as a mop, broom, gloves, cleaning solutions, buckets, rags, and garbage bags; and basic tools for minor repairs (hammer, screwdriver, wrench, etc.).

The rest of the necessary equipment can be rented from stores like The Home Depot (ie pressure washer, generator, etc.), including the trailer if you don’t have one.

Most have everything you need to get started in the garage.

Most people looking to start a foreclosure cleanup business already have everything they need in their garages to get started. At a minimum, the basic services that lenders and property maintenance companies will expect companies to provide are: cleanup and trash removal.

Be prepared with a small digital camera to take before and after photos to show proof of your work; almost all companies require it. Also, have access to the Internet because most work orders are received and responded to online. If you don’t have a computer at home, use the library until the business can afford it.

Take a look around your garage to assess your equipment and plan the start

If you’re ready to take the entrepreneurial plunge and start your own business, take a look around your garage and assess the small business start-up kit that may be gathering dust. Chances are, you have a gold mine of tools and equipment that could net you tens of thousands in contracts for your new foreclosure cleanup business. (Our first foreclosure cleanup job paid almost $3,000. After a few smaller ones, the next one we got paid almost $7,000, and we had barely even opened our doors!)

Good luck in your foreclosure cleanup business.