Hiring Undocumented Contractors for REOs.


There are lots of things you can do to streamline your business in the REO industry. But, one thing I disagree strongly with is employing undocumented contractors to get the work done for really cheap. The drive for companies who do this is to maximize the profit they get after expenses, including contractor payroll. And, they take a huge risk as their reputation and the money they are saving may be on the line.

There may be a great deal of pressure on the bidding end to drive your prices down to get approvals from clients. The game in “competing” with other contractors is often to creatively save money on materials and other expenses for the sake of coming in lower. But, hiring illegal workers is not creative. It’s a liability.

There was a time when the industry was just picking up that anyone with a truck and some tools could go out and make money by servicing vacant assets. Now, thankfully, those who manage portfolios are demanding insurance, errors and omissions, workers compensation, etc. because of the plethora of screw ups that occur on a daily basis while someone climbs a ladder or replaces a water heater or winterizes a plumbing system. Now it is difficult to even get third party work without it — which is a positive development.

An illegal worker may be very talented in whatever type of REO service you have hired them for and never cause an issue. They may never have an accident and provide the highest quality of results on every project. And you may be laughing all the way to the bank every month because of the money you have saved. But, it is felony. And who knows how people find things out? But, they do. Especially in the spirit of “competition”. Don’t do it — you could lose your business.

Advertisements

About this entry