Not all general contractors in Mesa or Phoenix are qualified to complete real estate-owned (REO) renovations. There are many differences between standard residential property renovations and those of REO properties. This difference means you do not want to hire a general contractor in Phoenix (or anywhere else) who does not have experience working on REO properties or doing property preservation.
REO and property preservation are terms that are sometimes used interchangeably, but this is misleading. REO properties are those that are owned by lenders that have not been able to sell them yet. These properties usually need to be renovated before being listed for sale. Property preservation requires a contractor to specialize in preservation objectives and techniques to sustain the condition of a property.
REO properties often (but not always) need repairs and renovation work done to make them market-ready. Lenders hire general contractors in Arizona and elsewhere to get properties ready quickly and correctly. The right contractors will understand the timing constraints and special needs of REO property renovations.
How do you find contractors in Arizona who are familiar with renovating REO properties?
Choose a Contractor with Proven REO Property Experience
Any contractor you are considering hiring for your REO properties must know the industry inside and out from the ground up. They should be able to give you a list of major REO banking industry entities that have been their clients, including lenders like banks, investors, housing entities like Fannie Mae, and others.
Always ask for references, and contact those references. When you do, ask specific questions about how communicative the contractor was, what issues arose, and how they handled them.
Ask references for information on whether the contractor completed the job on time and within budget, too. One of the main reasons contractors are hired for REO renovations is to quickly rehab the property and sell it as soon as possible. Being experienced in providing complete turnkey rehab services is vital.
Match Their Skills with Your Project Needs
General contractors in Phoenix do not have to have experience with a hundred different services (although that might be nice), but they must be experts in the services you need. Your needs might include mold remediation, carpentry, plumbing and electrical, countertops, window and screen replacement, foundation repairs, roofing services, HVAC work, flooring, and anything else.
If a general contractor does not have experience with a task you need to have done, they should have connections to other professionals they can bring in who do have experience. Before hiring a general contractor in Arizona, make sure they are qualified to do what you need them to do. These responsibilities also include pulling permits and interacting with local ordinance officials.
Create a Goal Checklist
Remember that your objective is to hire a general contractor to get the property ready to be marketed and sold quickly to recoup your initial investment. Every day the property sits unsold is money you lose. Your REO department should set a goal to list the property on the market within days of acquisition. That goal should outline details in a checklist.
Your goal checklist should include steps like securing the property, inspecting and winterizing it, and performing interior and exterior debris and trash removal. You will need the contractor to repair damages and rehab the property.
Specify tasks like carpet replacement, appliance repair, roof services, etc., in the checklist. Lawn maintenance will likely need to be done, including shrub trimming and walkway edging. You might even need to add monthly marketability orders so that the property can pass a white glove inspection.
Get an Idea of What the Contractor Will Do to Get Your Property in Marketable Condition
REO contractors are often the first people to see the true condition of a property. They are called the “eyes and ears” of the entity that owns the building. As such, they need to document and take photos of damages and dangerous conditions. The goal is to call attention to all issues that may interfere with bringing a property to marketable condition.
Partner with general contractors in Mesa, who offer superior, experience-backed resolutions for REO properties. Almost all work orders for REO properties are rush orders, so the contractor must convince you that they will adhere to quick turnaround times.
Don’t Underestimate the Importance of Photo Documentation
With REO renovations, photo documentation provides proof of the problem, the work, and the resolution. Many REO property-owning entities will decrease payment to contractors if insufficient photographic evidence is provided.
The general contractor’s responsibility is to submit photos to justify issues, work, and resolutions, so you must inquire with each potential contractor about taking pictures (and clear pictures, at that) throughout the REO renovation process.
Knowing ahead of time how to find a general contractor for REO renovations will make the entire process much less stressful and time-consuming.
Interested in Learning More About Working with Professional REO Contractors?
If you are looking for a reliable contractor with a wealth of REO experience, contact Charter Construction Group today.
