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TrashOut Cash

Property Preservation Training LLC

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Copyright Property Preservation Training LLC

ALL RIGHTS RESERVED.

No part of this manual/book or accompanying materials may be reproduced or transmitted in any form or by
any means, electronic or mechanical, including photocopying, recording or by any informational storage or
retrieval system without express written permission from the publisher.

Published by:
Property Preservation Training LLC

Legal Notices:

While all attempts have been made to verify information provided in this manual and the accompanying video,
audios and reports, neither the author nor the publisher assumes any responsibility for errors, inaccuracies or
omissions. Any slights of people or organizations are unintentional.

This manual and accompanying material is not intended for use as a source of legal, medical or accounting
advice. The information in this manual and accompanying material may be subject to varying federal, state,
and/or local laws. You should be aware of and abide by, all local, state and federal laws, if any, which apply to
you and your profession or field.

The purchaser or reader of this manual/book and accompanying material assumes responsibility for the use of
the materials and information. All returns must be in original, undamaged condition or the guarantee will be
void. Should there be any questions, please contact the publisher.

Neither the author nor the publisher assumes any liability whatsoever on behalf of any purchaser or reader of
this manual/book and accompanying materials.

Your results may vary from any given in this manual.

PRINTED IN THE UNITED STATES OF AMERICA

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This course is dedicated to my family, especially my grandparents in particular. You have taught me that
dedication, taking action, and smart hard work is the formula for everlasting success.

Thank you for sharing your knowledge with me and making me the best I can be.

“Goals will not be accomplished until one clearly understands what the goal is and what they themselves
specifically need to do to meet that goal”

~Stephen Covey Live The 8th Habit

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TABLE OF CONTENTS
INTRODUCTION 5
MODULE ONE-GETTING STARTED 6
MODULE TWO-GET YOUR NAME OUT 9
• Build Your Resume 9
• National Registration 10
• Advertise Your Business 10
MODULE THREE- EQUIPMENT AND SUPPLIES 10
• Vehicles 10
• Cleaning Supplies 10
• Equipment 11
MODULE FOUR-WORKING 13
• Getting Hired 13
• Testing 13
• Start Working 13
• Common Services 14
PROFIT TRICKS
• PROFIT TRICK #1 17
• PROFIT TRICK #2 17
• PROFIT TRICK #3 18
• PROFIT TRICK #4 19
• PROFIT TRICK #5 20
• PROFIT TRICK #6 21
APPENDIX A-SUPPORTING DOCUMENTS & INFORMATION 22
RESUME SAMPLE 23
EQUIPMENT & SUPPLIES LIST 24
PROPERTY PRESERVATION SUPPLIERS 25
UTILITY TRAILER COMPANIES 26
PROPERTY PRESERVATION COMPANIES (Master Contractor List) 30
APPENDIX B-HUD PRICING & GUIDELINES 33

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INTRODUCTION

I’m truly pleased that you are here, and it is my sincerest hope that Trashout Cash exceeds all of your
expectations, but before you dive in, I feel obligated to warn you…

Trashout Cash was not created for literary style or for entertainment purposes. It was created to teach you the
fastest way to start, manage and run an extremely profitable property preservation and trashout business.

So if you are just looking to be entertained, you won’t find that here. This is not one of those courses that is full
of fluff nor extra information that will not benefit you. What you will find here are real steps and instructions
that, if implemented, can change your financial future forever.

This system has worked for many people from all types of backgrounds and skill levels. With this course I have
removed all the excuses for success. You now have all of the information that will help you get started fast.

Trashout Cash came into existence not too long ago, and in its wake will leave all who are searching for a
profitable business opportunity divided. Those who choose to reap the rewards that it offers and those who must
try to compete against it. Hint: you do not want to be a part of the latter group…

Grab a pen and notepad and get ready to take your financial future to the next level. I am convinced that you
will find all that you will need to start your business in the pages to follow.

Dedicated to multiplying your success,

Anthony Simonie

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MODULE ONE:
Getting Started
Starting up a business may seem like a daunting task, but with the following steps you will be up and running in
no time with little-to-no stress, and the knowledge that by following this outlined program you are guaranteed to
be successful.

Step One: Set Up Your Legal Entity

When starting up a business, it’s important to think long-term and keep the vision for your company in mind.
Be aware of the current market trends, the skills and advantages you bring to the table and your future goals.
For your new trashout business, make sure to set up a completely separate company than any other interest of
business you currently have, and not combine them. This helps protect you and your business.

The structure you choose to use will determine how you file your taxes each year. Each state has their own laws
and regulations regarding starting up businesses, so talk to your local city authorities to find out any additional
permits or paperwork that you might need. You also might want to speak to your attorney for advice on what
structure will work best for you in your state.

Types of business structures:

• Sole proprietorship
o The only thing you need to do to start this type of business is report your business income and
expenses on your Form 1040 Schedule C.
• Partnership
o Partnerships must have at lease one General Partner who assumes unlimited liability for the
business, and must have at least two shareholders who follow an operating agreement listing the
responsibilities and compensation of each party.
• Corporation
o Business is considered a separate entity, and this often provides a measure of legal and financial
protection.
• Limited liability corporation
o Like other corporations, this provides a measure of legal and financial protection.

We recommend a corporation or LLC to protect your personal assets and/or other businesses. They are easy to
set up and are able to grow with your business, allowing you to have employees.

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Step Two: Define Your Service Areas
Generate a list of zip codes in a 90-mile radius from your city—these are the areas that you will want to focus
on. Organize the information in a table or Excel spreadsheet so that you can keep track of neighborhoods,
market trends, and other information that might help you successfully bid on jobs.

Step Three: Register For A City License

Call or go online to your city website and register for a business license. If you will be working under a
different name from your legal name, called ‘doing business as’ or, more commonly, DBA, you will need to
also register for a fictitious business name.

Generally, your business license is only valid for the city you registered it in. So eventually, once you start
growing your business and expanding your service areas into nearby cities you will need a license for each city
in which you work.

Step Four: Obtain An Employer Identification Number

The EIN is used by the federal government during tax time and is used as the company’s taxpayer identification
number. Under certain circumstances, a sole proprietorship must also have an EIN, but usually, sole proprietors
can simply use their Social Security number.

While you might think it’s more cost-effective to do all of the work yourself at the beginning, you’ll most likely
change your mind once you start contracting more work than you can handle once your business takes off. In
order to hire help, you need an EIN prior to hiring employees.

To set up your EIN:

• Go to www.irs.gov to set up your EIN
• Fill out the required forms either electronically or print and mail or fax
• There is no charge to get an EIN

Step Five: Set Up A Business Bank Account

Everything you do in business revolves around money. Opening a business bank account is the simplest way to
achieve accountability, and will also give you credibility when it comes to applying for loans or credit.

It’s very important to always keep business accounts separate from personal accounts. This protects yourself as
well as make accounting much easier.

• Set up a business checking account

• Apply for a business credit card

Note: You will need to have your business license and EIN information, as well as a fictitious name record if
using a business name other than your real name, to give to the bank in order to set up a business bank account.

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Step Six: Purchase Accounting Software
As you already know by now, money is the driving factor behind the business. It’s important to not just focus
on the money coming in, but also the money your bank as well as the money going out. If you keep up on things
from the get-go, you’ll be prepared and ready for tax time—avoiding you lost of stress and worry.

We recommend QuickBooks Simple Start Edition. This program allows you to create invoices for individual
projects, manage payroll and clients, pay bills and write checks. It also creates balance sheets and year-end
statements, saving you lots of time and money on expensive accounting services.

Step Seven: Hiring Employees

Initially, you should work as the crew leader or foreman on each job, so that you can get the hang of things as
well as save yourself from paying additional employees. Yet if you stick to these steps your business will
quickly grow—and you’ll be securing more work than you will be able to accomplish on your own.

When hiring employees, there are several things you need to take into consideration:

• Decide if you want employees or 1099 contractors.

o Employees require more studious payroll procedures and tax calculations. Hired contractors
complete their own taxes, and you are not required to cover them with insurance.
• Determine how much you want to pay.
• Run ads online at craigslist.org to find general laborers. Craigslist is a great place to advertise because
it’s used by thousands of people all over the world, and best—it’s free!

Step Eight: Find Storage Parking For Your Trailer

Finding a safe location to park your trailer and equipment while on a job is very important. Not only for the
safety of your equipment, but for the general public, and be sure to abide by all parking rules and notices. The
location should be readily accessible by you when and if needed between 6 AM and 7 PM.

Step Nine: Insurance

Property Preservation Errors and Omissions Insurance and General Liability Insurance protects not only you
and your business, but your clients as well. Most national companies will require a copy of your certificate of
insurance before you are able to start work. There are not many companies that offer this insurance, and one
that we recommend is Chubb Group through:

Leonard Insurance Services Agency Inc.

Phone # (330) 266-1914
Fax# (330) 498-9952
Email: dfaye@leonardinsurance.com
www.leonardinsurance.com

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MODULE TWO:
Get Your Name Out
Once you get your business structure down and your insurance coverage settled, before you go out and start
registering with national contractor corporations and bidding on jobs, there are still several steps you need to
take to help present your business in the best light to potential clients.

Important documents that you should have on hand prior to bidding:

• Resume
• Service area spreadsheet
• Contractors general liability insurance policy
• E&O insurance policy
• EIN & W-9

Since you’ve been working your way through the steps, you will already have your EIN, service area
spreadsheet, and insurance policies ready.

Have filled-out copies of your W-9 ready if requested, both in hard copy and electronically if the client requests
it to be emailed. You can find blank W-9 forms online at http://www.irs.gov/pub/irs-pdf/fw9.pdf.

So now the big thing to focus on is your resume.

Building Your Resume

When creating your resume, be sure to incorporate the following:

• Convey a professional image by demonstrating that you understand the property preservation business,
and that your company is dedicated solely to that task alone.
• Include any work experience relevant to property preservation.
• Describe the services that you offer, and what areas you work in.
• Indicate that all work will be completed within the industry standard of 3 to 5 days from receipt.
• Be sure to include your contact name and number, as well as an email address.

We have included our resume as an example on page 23 of the manual for reference. However, you need to
create a unique resume that highlights your own personal skills and services.

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National Registration
In order to open yourself up to projects under large, national corporations, you will have to register your
business to be qualified to even request work. This is very important if you want your business to grow and
succeed.

Register with the large companies as soon as possible because sometimes, depending on the company and their
accounts, it can take up to one to six months for your application to be processed and accepted. One downfall of
most trashout companies is that they limit themselves to working with one or two companies. You, on the other
hand, should initially register with every company possible to increase your chances of obtaining contracts.

Here are some basic pointers on registering:

• Some companies have their applications online for you to download and fill out. If not, call each
company at the number provided and request an application package.
• You may want to solicit business from other REO agents in your area.
• Wait seven days after submitting your application, and then do follow-up calls for each company and
ask to speak with a recruiter.
o Tell them you are a property preservation company and you are interested in working for their
company in your area, and want to know of any available projects—current or future.
• Be persistent. You’re not going to make any money if you sit around and wait for companies to come
knocking on your doorstep. Call every week to check for upcoming work.

A list of national contractor corporations is included on page 30 of the manual. Though businesses are always
growing, and you may want to search for other additional property preservation companies in your state.

Advertising Your Business

No one is going to know who you are or what you do if they don’t hear about you. In order to compete with
other companies for work, you need to be noticed.

One of the easiest ways to do this is to build a website. There are so many low-cost domain name registers and
hosting servers, that you can create a simple but professional and cost-effective site that is an excellent
‘electronic business card’ for your business.

Godaddy.com is an excellent domain name registration service, who also provides site hosting accounts. When
you buy a domain name, they also give you a personalized email address, which looks much more professional
than using a free Yahoo! or Hotmail account.

Important website to register on are propertypreservation.com, as well as reonetwork.com. REO Network is an

online directory of REO specialists, including REO brokers, appraisers, and property preservation. By
registering online you can create a company profile detailing your services and service area.

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MODULE THREE:
Equipment and Supplies
Vehicles
Due to the nature of the property preservation, choosing an efficient and logical work vehicle is a very
important step in starting up your business, and is one investment that you should put a lot of thought into.
Factors to consider when purchasing a vehicle is its reliability, storage and towing capacity, initial investment as
well as long-term costs for upkeep.

Cargo vans are generally good choices—especially if you opt for a used one in good condition. They are large
enough for tools and workers inside, can store ladders on the roof. If purchasing a cargo van, important factors
to remember are that larger is better, you’ll want and a powerful engine such as a V8 or diesel.

Trucks are also another logical choice. In general, between trucks and vans in the same heavy weight category,
trucks have a higher payload and towing capacity. A V8 or diesel super or crew cab can transport more workers
than a cargo van, and you have the back end to stow tools and equipment—though you’ll have to invest in a
camper shell to ensure security.

You will also need a landscape-style trailer to transport items back and forth between jobs. Trailers should have
expanded metal drop-gate and sides, tandem axels, brakes, and be a minimum 14’ x 7’ with 4’ sides. Dump
trailers are not recommended because of their weight, expense, and insurance requirements. Items to keep with
your trailer include a spare tire, tarp, and a floor jack.

If you can afford the additional cost, other items that will be of extreme benefit to your company are having a
landscaper’s box to hold your generator, and installed racks to organize your tools and equipment.

Cleaning Supplies
Basic cleaning supplies required for most jobs include:

• Mops and brooms

• Paper towels and rags
• Toilet brush and plunger
• Diluted ammonia in squirt bottles
• Bucket and Rubber gloves

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Equipment
The following is a list of recommended equipment:

• An 18-volt cordless drill, battery charger, and a spare battery

• Drill bits appropriate for drilling locks
• Lock codes: 67767, 76667, 35241
• Lock sets: four deadbolts and knobs
• Hammer, sledgehammer, rakes, scoop shovels, spade, and digging shovel
• Generator: We recommend Toro brand, 3500 kW, Briggs & Stratton engine
• Pancake air compressor with a porter cable
• Shop Vac: 3500 kW
• Digital camera
• We recommend a laptop and Verizon wireless card to work on the road

A complete list of required start-up equipment can be found in Appendix A.

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MODULE FOUR:
Working
Your business is set up and ready, you’ve sent out applications and your resume, and you’ve stocked up on
supplies and equipment and hired employees. Now, what?

Getting Hired
It’s very important to be sure of yourself and knowledgeable about your business when that first call comes in
about a foreclosure. You want to be prepared and ready to answer any and all questions that might come your
way. By being primed and ready, you can stand up against your not having much experience, and gain you jobs
to list on your resume.

One thing to always keep in mind when getting hired and given a timeline: never ask for more time to complete
a job. Do whatever it takes to finish on time, working around the clock if need be, because you are starting out
and want to build strong relationships and gain more work, allowing your business to grow.

Testing
Most companies require you to test your knowledge of property preservation before beginning work, and will
then put you on a 90-day probation period. Other tests may be required if you plan to expand your services or
work on certain further assignments.

The test is open book, and is based on the HUD guidelines and pricing lists that are attached in the appendix of
this book. You can also visit their website at hud.gov for more information.

Start Working
Upon obtaining your first project, there are several steps that you need to take to make sure that you complete
the job as required and hopefully guarantee repeat work from your clients.

First, request a copy of their standard contractor guidelines or specifications. This will help you perform
according to their detailed regulations, making your job easier and your clients happy. Along with the
guidelines, you also should ask for pricing schedules and lock and lockbox codes.

It is important to document every service you perform by taking multiple pictures of each step from start to
finish. This includes taking pictures before and after each and every service is performed, as well as during the
work.

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Below are the most common types of services that you will perform.

Determine Occupancy
Always keep the work order on hand if you are visiting a property in a secure neighborhood. To determine
occupancy of a building, there are many signs on the property that will give you clues as to whether the
property is abandoned. These clues include overflowing mail, landscape overgrowth, in-service utilities, and
lights.

After taking in the outside appearance, try knocking on the door to see if anyone answers. If not, peek through
windows to see if it looks like someone is still living there. You can also talk to neighbors for any information
on the prior occupants.

If you check out a property and you think it is occupied, take as many pictures as you can to prove that you
were there. Shots to take include the front of the house with the house numbers, a currently registered car in the
driveway, movement inside the property, or working sprinklers. Fill out a report and send it along with photos
to your client to inform them of the problem.

Gain Access to the Property

If you determine that the property is not occupied, get inside by drilling out the locks on the front door. Always
enter with caution, calling our “real estate” to alert any possible occupants so as not to surprise them. This is a
cautionary step for both the occupants as well as yourself.

Once inside, look throughout the entire residence for personal property, taking pictures and listing the items and
their approximate value. If the value of all personal property exceeds what could be considered $300 worth of
garage sale items, then you need to lock the house back up and alert your client so they can move forward with
a possible personal property conviction.

Secure the Property

After walking through the premises, you need to secure everything according to the work order-specified locks
and codes. Sliding glass doors can be secured using bolt clamps, and long-shackled padlocks for padlock gates.
Board up any broken windows according to the work order specifications. Disable and padlock garage doors so
the garage is secure as well.

You are not required to repair roofs, but if there are holes you may be required to secure those as well, though
it’s much easier than it sounds. All you need is a simple blue tarp for the patches, and 1” furring strips held
down by 2” roofing nails.

Winterize the Property

Winterizing is something that is not required at every jobsite, so be sure to check your work order if it is
required. There are two lists of steps required to winterize a house depending on whether the property uses a dry
heat system or a water furnace.

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For jobs with a gas furnace, shut off the water from the main line inside the house and secure it with a zip tie,
and then drain all the faucets, toilets, and hoses. Use a shop vac in toilets to remove all of the water. Run air
through all of the lines for ten to fifteen minutes using an air compressor to blow all the water out. Afterward,
shut all the valves and run a thirty-pound pressure test, watching for the lines to stay the same for close to
twenty minutes, if so, then the lines are fine. Finish by pouring one cup of RV antifreeze in each opened drain,
tank, and toilet bowl.

For jobs with a working water furnace system, try to convince the bank and agent to leave the system as is.
Close the water lines and drop the thermostat to fifty-two degrees. If the furnace is not a working system, then
follow the diagrams in the HUD guidelines.

Cleaning Up
Probably the hardest aspect of this business is being able to accurately estimate the amount of debris is on each
property, how long it will take you to pick up and remove it, as well as if there are any safety hazards or items
that cannot be simply dropped off at a landfill.

Always take pictures of the entire cleaning process to support your billing estimate, including the debris in its
original location, being removed, and on your trailer. Measure overgrown landscape and brush by having a
point of reference—such as a yard stick—next to the pile. Certain items such as tires, oil, and paint are not
allowed at landfills, and must be disposed of properly. Make sure to take pictures of these items, as many times
you can charge your client more for their special care and disposal.

If there are any safety hazards present on the property—such as bare wires, trip hazards, protruding nails, holes
in the floor, or a falling roof, make sure to carefully note each one. Unless you have been given an allotted
amount for possible repairs, you must first call your client to get instructions and approval before starting any
repair work. Though it is normally your responsibility to remove basic hazards such as protruding nails.

Swimming Pools
If there is a pool in the backyard of the property, you need to take special care in securing the area to prevent
any injuries or accidents. Most of the time above-ground pools will simply be removed or disassembled and left
at the property.

If the pool is in-ground, there needs to be a padlocked fence or a deck barring access. If the current fence is
damaged, or non-existent, you need to either repair or build a fence to keep everyone out. The other option is to
build a deck over the pool with 2x6 chicken wire.

If the pool needs to be cleaned, the price normally includes pumping out the water, pressure washing, filling,
and chemical treatment, and you will usually have to wait around two weeks for approval before cleaning.

Landscape Care
Landscape care is basic and simple. Mow and edge the lawn, clear off sidewalks and driveways, pick up fallen
leaves and tree debris, and trim shrubs. Always remove visible weeds.

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Detailing the Inside
After clearing out the inside of debris and personal items, you’ll have to go back and clean everything up.
Cleaning includes dusting, mopping, vacuuming, cleaning counters and bathrooms, and wiping down mirrors
and windows. Pretty much all of the duties that are required to keep your own home clean. Again, take pictures
of the entire process for documentation and support of your work.

How to Get Paid

Now on to the best part. Getting paid. Once you’re finished preserving the property, you will need to upload and
send the client your pictures and an invoice, signaling completion of the work and a request to be paid.

Always keep records of all of your photos in case there are questions or discrepancies. You should also keep
records of all of your invoices and correspondence, including any changes to the work order, and should stay up
to date on entering your invoices into your accounting software. By keeping good records, your business will
run much more smoothly and be easier on you during tax time.

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PROFIT TRICKS
Profit Trick #1:
Keeping your costs down
I now have businesses set up in Arizona, Missouri, and California using the same techniques and strategies that
I give you access to in this course, so I am one-hundred percent confident that you will succeed, too.

It is very possible to keep the cost of supplies and labor to less than 25% of your total revenue by bidding jobs
at seventy to seventy-five percent of the allotted allowables of the project. This means adding up the total for
the services to be done and deduct twenty-five to thirty percent. By doing this, you will beat the competition’s
bids and earn much more business, while still turning a profit.

Here is a real world example:

• The average property pays $1000.00

• The average time to complete a house is 4-6 hours
• The average cost of fuel per house is $25.00
• The average cost of supplies per house is $55.00
• The average disposal fees per house is between $25-$50

Let’s say that you will pay your workers $10.00 per hour. It takes two people four hours to complete which
gives us a combined labor total of $80.00. Next, factor in the fuel cost at $25.00 and the supplies and disposal
fees at $55.00 and $50.00, respectively. Throw in a $10.00 administrative fee for invoicing the order.

This puts you at a total cost of doing business for $220.00. Now, take the payout for the house of $1000.00 and
subtract your cost of doing business of $220.00. This leaves you with a $780.00 gross profit margin and in less
than twenty-five percent of expense to complete the job.

Profit Trick #2:

Bypass expensive workman’s compensation insurance

The best way that I have found to bypass the “expensive” workman’s compensation insurance that is sometimes
required by master contractors and lending institutions to start receiving work is to take out the policy using
ADP Insurance Services (Automatic Data Processing Inc.). ADP offers the most inexpensive workman’s comp
that I have seen to date. They also do not require a large deposit like many of the other companies that offer
workman’s comp. ADP also offers an option to pay monthly. This way, you will be able to add more profit to
your bottom line and can rest easy. ADP can be reached at www.ADP.com or 1-800-CALL-ADP ext. 411

In regards to employees, I have found that you can make a little more profit by using actual employees.
Employees will work for less money than subcontractors because they do not have to purchase or use their own
equipment or pay other costs associated with doing business. They will be using yours. Subcontractors, on the

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other hand, have to purchase their own equipment and are responsible for paying their own fees, supplies, labor
and any other costs of doing business.

In my own personal experience, I have seen these pitfalls when working with employees:

• Employees usually will not take care of your equipment as well as you will.
• They will not work as hard often times as a subcontractor who owns their own business.
• Sometimes have bad attitudes and can tend to be lazy at times.
• Require more supervision.

With that said, if you can keep a close eye on employees and are a person who enjoys motivating people, you
can definitely make a little more profit using this method.

However, I prefer to use subcontractors most of the time even though it costs me a little more to get a job
completed. Subcontractors are responsible for their own equipment and maintenance, auto insurance, and the
other costs associated with doing business.

I have also found that it is really simple to get most contractors to agree to be set up on a net 30-day pay period.
This just means that you have thirty days to pay the subcontractor once that particular job is complete. Most of
the time subcontractors are used to being set up on a thirty-day pay cycle and are used to this because they have
owned their own businesses. This also allows you to minimize your business start up costs.

Profit Trick #3:

Three common mistakes

There are three common mistakes that I see almost every trashout company make that literally eats away most
their profits, and the thing is they are mistakes that are easily avoidable if you follow the steps in this manual
and pay attention to the following:

1. Not knowing chargeable fees.

You need check with your work provider to and have them send you a spreadsheet to keep handy that lists the
appropriate fees and allowables that you can charge for each service. When performing work for REO brokers
or realtors, you can usually be safe with using the HUD guidelines when bidding. Keep in mind however that
most master contractors do not usually pay by the HUD guidelines. If you agree to perform a service without
knowing exactly what you can charge and pay too much for the labor, you will quickly see your profits dwindle.

2. Buying your equipment and supplies at retail prices.

Do not pay retail for your equipment and supplies. An easy way to find equipment is to go to
www.craigslist.com and search for the equipment you need in your area. You can find almost anything on
Craigslist and the prices are usually really low or you can negotiate them especially in a down economy.

Another way to get your supplies discounted is to become a member of the ASREOS membership website as
mentioned in the front pages of this manual. By becoming a member, you automatically get a special discount
of five-percent off of your supplies when ordering through the link on the website. This one thing saves me
thousands of dollars every year and it can do the same for you. You must email my support team to qualify for
your free 30-day trial at Support@TrashOutCash.com

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3. Uneducated employees and subcontractors
Not educating your employees and subcontractors on the proper use of your equipment and the proper
procedures to follow at the property so that nothing of high value gets thrown away or any piece of the property
gets damaged, can cost you dearly. I have had workers damage everything from weed eaters to damaging my
trailers to damaging one of my vans. This can cost you thousands of dollars and eat away a ton of your profit.

The best way I have found to handle this is to take the time to educate them on the proper ways to use the
equipment and certain dangers to be aware of and watch out for while operating company equipment. You may
also want to have an agreement drawn up to have them sign stating that they are responsible for unnecessary
damage to the property other than normal wear and tear. As always, I am not giving you legal advice and you
should contact a qualified legal professional to see what will be best for you.

You will also want to educate your employees or subcontractors on how not to damage the properties while
performing services. This includes how to gain access correctly while not damaging doors or windows and not
to throw away anything that can be considered of value before getting the approval from the master contractor
or lending institution and making sure to get it in writing to avoid any liability and to protect your profits.
You’ll want to train them to take very clear and extensive photos to document the entire condition of the
property. Make sure to take photos of all damages before completing any work at the property to prove that the
damage was there before your arrival and that it was not caused by you or anyone on your behalf.

In addition to this, you should also train your people very well on how to properly perform all services. One of
my crews missed one simple little zip tie and a photo of the zip tie on a winterization service and it ended up
costing me thousands of dollars because the pipes ended up freezing and breaking causing water damage to the
property. I had to pay even though the winterization was performed correctly other than placing one zip tie and
taking a photo.

So make sure to monitor the work performed very closely and document everything.

Profit Trick #4:

Saving money on insurance

The best place I have found to obtain the required Errors and Omissions and General Liability insurance is
through Leonard Insurance Services Group. (Contact information is on page 8 of this manual)

On average, this company is around 75% less expensive than any other insurance company that I have found
that offers the proper insurance required.

For example, my insurance originally was quoted at $6000.00 per year. I received it through Leonard Insurance
Services for around $1500.00

When calling this company, make sure to explain that you are a property preservation company and you wish to
obtain “mortgage field insurance”. This will help you to look less like a newbie. Also mention that you
understand that most companies get covered for less than $2000.00 the first year.

20
Here’s the best part: They will actually let you finance the cost! By financing it, you can spread the cost out
over many months and keep the extra capital in your account to help you grow your business.

Profit Trick #5:

Cut overhead costs
The best way to lower your over head costs by up to 60% and increase your profits is to:
• Take advantage of all the discounts you can get on all of your supplies and equipment, such as being a
member of the ASREOS. Once you grow even bigger, you can use that to leverage higher discounts.
• Look for inexpensive labor by placing ads on free classifieds such as craigslist.com.
• Look to buy your equipment from people on Craigslist.com. In a down economy, many people are
looking to sell away extra equipment and tools they are not using for cheap prices.
• Train your people thoroughly and correctly so that they are less likely to cause any damage to your
equipment and the properties that you are servicing. Again, you may want to check with legal council to see
if a legal agreement might be a good way to go if they purposely damage your equipment.
• Do not purchase a physical location for your business. You can operate everything from the comfort of
your own home office like I do. This will save you thousands of dollars every month by greatly reducing
your overhead costs.

Now you will have ongoing costs associated with doing business, but again your goal is to keep your costs as
low as possible without sacrificing quality of work and to increase your profits at the same time.
Simply put, your profits are monies left over after you pay all of your expenses. So if you have $10,000 in
monthly income and your expenses are $2,500, your gross profit for that month is $7,500.
You can keep your overhead costs down and manageable and profits high by using the information I mentioned
above.

In regards to purchasing equipment, you can use the vendors located within this manual to find reasonable
pricing.

Below is what I paid for my first business set up:

• General liability and Errors and Omissions Insurance = $1800.00 ($300 down and $166 per month
thereafter)
• Tools (I had most of the tools in my garage and I borrowed some)
• Generator = $250
• Pressure Test Kit = $60
• Lock Set Initial Order = $350
• Case of RV Antifreeze = $24
• Bag of Zip Ties = $10
• 16 ft Utility Trailer = $1400
• Pre-Owned Cargo Van = Zero Down and $199.00 per month 24 month note.
• Auto & Trailer Insurance = $80 Combined Monthly

Total first month investment = $2,673

First month revenue = $12,000.00 - $2673 up front investment = $9,327.00

21
$9,327 revenue after initial investment subtracted - $1,500 labor - $720 disposal fees - $350.00 fuel =$6,757.00
first month profit PART TIME! I made over 4 times my original investment in my first 30 days in the business!

Profit Trick #6:

Add-on services

Add on services that put a nice fat chunk of money in my pocket each and every month. Since these additional
services are usually performed at the same time as we are performing other services, it is like getting a nice big
bonus check. They don’t usually take much extra time or effort to perform, but can add quite a bit of profit to
your bottom line.

Below is a list of some of the common add on services that you may be able to get paid additional rates to
perform. This is usually done by making a phone call from the job site and advising the work provider on the
additional issues or services needed and asking for a fair rate increase to perform each one.

• Replacing smoke detectors

• Replacing CO2 detectors
• Replacing Light bulbs
• Replacing switch plate covers
• Capping exposed wires (This is the one that brings in enough money every year to buy a new car)
• Replacing fixtures that are missing or broken
• Broken windows to board
• Tree trimming
• Asking for rate increases for a refrigerator cleaning that is dirtier than normal
• Asking for rate increases to remove heavy debris like bricks or gravel or concrete blocks

A lot of trashout companies overlook these simple but profitable extra services and in doing so miss out on a lot
of extra profit. Make it a habit to always look for the hidden opportunities at each and every property to make
more profit.

These services alone usually pay for all of my expenses and add a healthy increase to my profit margin every
month.

22
Appendix A:
Supporting
Documents &
Information

23
Resume Example

24
 Equipment & Supplies List

Equipment
Shop Vac

Mop

Digital Camera
Ceiling Fan Dusters

Cell Phone

Computer/Internet Supplies

Cordless Drill (spare battery)
Screws

Drill Bits
Nails

Flashlights
Duct tape

Skill Saw
RV Anti-Freeze

Screwdrivers
Lock Sets

Reciprocating Saw
Lock Boxes

Hammer
Trash Bags

Sledge Hammer
Bolts and nuts

Rakes
Plywood

Shovels
2 x 4’s

Generator (Troy Built 3250 KW)
Padlocks

Air Compressor (Porter Cable
Hasps
C2002wk)

Ammonia

Pressure Test Kit (MFS Supply)
Oven Degreaser

Lawn Mower
Paper Towels

Weed Eater
Scrub Brush

Blower
Light Bulbs

Shrub Trimmers
Air Freshener

Sheers
Carriage bolts 6,8,10

Chainsaw
Sheets plywood 1/2

Trailer

Van/Truck

25
Supporting Documents & Information-Appendix A

Property Preservation Suppliers

 MFS Supply
 www.mfssupply.com
 Phone - (800) 607-0541

 Bargain Locks.com
 www.bargainlocks.com
 Phone - (888) 299-7159
 Email - info@bargainlocks.com

 Wholesale Locks
 www.wholesalelocks.com
 Phone - (952) 322-5103
 Toll - (800) 508-6889
 Email - dave@wholesalelocks.com

 VictoryStore.com
 www.victorystore.com
 Phone - (888) 968-2688 or (866) 241-2295
 Fax - (563) 884-4446
 Email - krg@victoryenterprises.com

 Roper Lock Box, LLC

 www.roperlock.com
 Phone - (330) 656-5148
 Toll - (800) 466-9312
 Fax - (330) 650-6814
 Email - info@roperlock.com

 Sanzo Specialties, Inc.

 www.sanzospecialties.com
 Phone - (607) 754-1152
 Toll - (800) 222-4041
 Fax - (607) 748-0507
 Email - customers@sanzospecialties.com

 Risco Lock Box Company

 www.riscolockbox.com
 Phone - (877) 747-2652
 Toll - (800) 929-0193
 Email - sales@riscolockbox.com

26
 Utility Trailer Companies

Arizona Delaware

 Fleming Trailers, Inc.  Top City

 17033 N. 63rd Ave.  2970 North DuPont Highway
Glendale, AZ 85308 Dover, DE 19901
 www.flemingtrailers.com  www.topcityonline.com
 Phone - (602) 938-2513  Phone - (302) 734-8670
 Fax - (602) 439-2470  Toll - (800) 787-1660
 Email - david@flemingtrailers.com  Fax - (302) 734-8643
 Email - topcityonline@hotmail.com
 Wells Cargo, Inc.
 6902 W. Hadley St. Florida
Phoenix, AZ 85043
 www.wellscargo.com  Cap World
 Phone - (623) 936-8150  5350 Eats Colonial Dr.
 Toll - (800) 348-7553 Orlando, FL 32807
 Fax - (623) 936-5808  www.capworld.com
 Email - info@wellscargo.com  Phone - (407) 277-0122
 Fax - (407) 823-9694
California  Email - Orlando@capworld.com

 Cuddeback Trailer Georgia

 12024 Woodside Ave.
Lakeside, CA 92040  Wells Cargo, Inc.
 www.cuddebacktrailer.com  2250 Industrial Blvd.
 Phone - (619) 561-1144 Waycross, GA 31502
 Toll - (800) 237-5170  www.wellscargo.com
 Email - info@cuddebacktrailer.com  Phone - (912) 285-8132
 Toll - (800) 348-7553
Connecticut  Fax - (912) 287-0018
 Connecticut Trailers  Email - info@wellscargo.com
 7 Bolton Center Rd.
Bolton, CT 06043  Roy Newsome Enterprises
 www.cttrailers.com  3928 Ogeechee Rd., Highway 17 S.
 Phone - (860) 643-9348 Savannah, GA 31405
 Toll - (800) 557-2901  www.tramptrailers.com
 Fax - (860) 645-8755  Phone - (912) 232-1689
 Toll - (800) 841-1102
 John A. Limberger, Inc.  Fax - (912) 232-7187
 324 Somers Rd.  Email - mail@tramptrailers.com
Ellington, CT 06029
 www.limbergertrailers.com  Trailers For Less Inc.
 Phone - (860) 875-4217  949 GA Hwy. 85
 Fax - (860) 870-8718 Fayetteville, GA 30215
 Email - limbergertrailersales@sbcglobal.net  www.trailersforless.com

27
  Phone - (770) 460-0314
 Toll - (888) 461-3033 Maryland
 Fax - (770) 460-0203
 Email - Scottie@trailersforless.com  Top City
 Fax - (360) 694-1170  13 South & Broadway, P.O. Box 247
Fruitland, MD 21826
Illinois  www.topcityonline.com
 Phone - (410) 742-3446
 R.A. Adams Enterprises, Inc.  Fax - (410) 742-3271
 2600 West Route 120
McHenry, IL 60051  Cap World
 www.raadams.com  681 East Diamond Ave.
 Phone - (815) 385-2600 Gaithersburg, MD 20887
 Fax - (815) 385-6684  www.capworld.com
 Email - info@raadams.com  Phone - (301) 417-6994
 Fax - (301) 921-8798
 Northern Illinois Tractor & Equipment  Email - Gaithersburg@capworld.com
 2388 Conger Rd. Massachusetts
Pecatonica, IL 61063
 www.niteequip.com  Cap World
 Phone - (815) 239-9096  245 Turnpike Rd. (Rt. 9 W.)
 Fax - (815) 239-9032 Westborough, MA 01581
 Email - info@niteequip.com  www.capworld.com
 Phone - (508) 898-2277
Indiana  Fax - (508) 898-0102
 Email - Westborough@capworld.com
 Wells Cargo, Inc.
 1503 W. McNaughton St. Michigan
Elkhart, IN 46515
 www.wellscargo.com  Grandville Trailer
 Phone - (574) 264-9661  3319 28th St. SW
 Toll - (800) 348-7553 Grandville, MI 49418
 Fax - (574) 264-5938  www.grandvilletrailers.com
 Email - info@wellscargo.com  Phone - (616) 538-2290
 Fax - (616) 538-3135
 US Cargo Division
 Forest River, Inc. New Hampshire
17645 Commerce Dr.
Bristol, IN 46507  Hawkensen Equipment Co., Inc.
 www.uscargo.com  22 Hawkensen Dr.
 Phone - (574) 848-1335 Rumney, NH 03266
 Fax - (574) 848-5862  www.hawkensenequipment.com
 Phone - (866) 620-5846
Maine  Fax - (603) 536-3958
 Email - hawkensen@adelphia.net
 Coastal Metal Fab, Inc.
 120 Old Lisbon Rd., Route 196  Cap World
Topsham, ME 04086  442 South Broadway, Route 28 South
 www.sandspreader.com Salem, NH 03079
 Phone - (207) 729-5101  www.capworld.com
 Fax - (207) 729-8782  Phone - (603) 890-1190
 Email - bills@sandspreader.com  Fax - (603) 894-4880

28
  Email - capworld@aol.com  Summit Trailer Sales & Services
 3330 South Main St.
New Jersey Akron, OH 44319
 www.summittrailers.com
 Performance Trailers, Inc.  Phone - (800) 649-8160
 39 Old Ledgewood Rd.  Fax - (330) 644-0547
Flanders, NJ 07836  Email - summit trailer@sbcglobal.net
 www.landscape-trailer.com
 Phone - (973) 347-3472 Oregon
 Fax - (973) 347-4101
 Email - customerservice@traileroutlet.com  My Little Salesman, Inc.
 2895 Chad Dr.
New York Eugene, OR 97408
 www.mylittlesalesman.com
 Congelosi Trailer Sales, Inc.  Phone - (800) 493-2295
 2201 Rt. 17K  Fax - (541) 342-3307
Montgomery, NY 12549
 www.congelositrailersales.com Pennsylvania
 Phone - (845) 361-2246
 Toll - (888) 310-2246  Wells Cargo, Inc.
 Fax - (845) 361-2141  50 Enterprise Dr.
 Email - zippy@congelositrailersales.com Carbondale, PA 18407
 www.wellscargo.com
 Landscape Trailers  Phone - (570) 282-3726
 601 Harris Rd.  Fax - (570) 282-3667
Ferndale, NY 12734  Email - info@wellscargo.com
 www.landscapetrailers.com
 Phone - (845) 292-1467  Worthington Trailers
 Fax - (845) 292-1635  76 Odell Rd.
 Email - info@landscapetrailers.com Muncy, PA 17756
 www.worthingtontrailers.com
North Carolina  Phone - (570) 546-8885
 Fax - (570) 546-8969
 East Coast Trailer  Email - wwitrail@worthingtontrailers.com
 3800 Jeff Adams Dr.
Charlotte, NC 28206 Tennessee
 www.ecttrailer.com
 Phone - (704) 596-4505  AllState Trailers Inc.
 Toll - (800) 320-8809  10304 Cogdille Rd.
 Fax - (704) 596-3147 Knoxville, TN 37932
 Email - info@ecttrailer.com  www.allstatetrailers.com
 Phone - (800) 673-4411
Ohio  Email - Knoxville@AllState-Trailers.com
 Rock & Dirt
 Smith Trailers and Equipment, Inc.  P.O. Box 489
 9677 Cincinnati-Columbus Rd. Crossville, TN 38557
Cincinnati, OH 45241  www.rockanddirt.com
 www.smithtrailers.com  Phone - (800) 251-6776
 Phone - (513) 755-2497  Fax - (800) 423-9030
 Fax - (513) 755-0184  Email - webmaster@rockanddirt.com
 Email - info@smithtrailers.com

29
 Texas
 Wells Cargo, Inc.
 600 Texas Central Parkway
Waco, TX 76714
 www.wellscargo.com
 Phone - (254) 772-1740
 Toll - (800) 348-7553
 Fax - (254) 772-7673
 Email - info@wellscargo.com
 Big Tex Trailers
 850 I-30 East
Mt. Pleasant, TX, 75455
 www.bigtextrailers.com
 Phone - (903) 575-0300
 Fax - (800) 577-8858
Utah
 Wells Industries, Inc.
 1741 West 2550 South
Ogden, UT 84402
 www.wellscargo.com
 Phone - (801) 621-3637
 Toll - (800) 348-7553
30
 Fax - (801) 392-5443
 Email - info@wellscargo.com
 Email - sales@grandvilletrailers.com
Virginia
 J.A. LaVoie Equipment Sales, Inc.
 12247 Washington Hwy.
Ashland, VA 23005
 www.jalavoie-equip.com
 Phone - (888) 897-0794
 Dehaven Trailer Sales
 2142 Berryville Pike
Winchester, VA 22603
 www.dehaventrailersales.com
 Phone - (540) 667-7855
 Fax - (540) 662-0112
Washington
 Buz’s Equipment Trailers Inc.
 5815 NE 78th St.
Vancouver, WA 98665
 www.buztrailers.com
 Phone - (360) 694-9116
 Property Preservation Companies

Safe Guard Properties, Inc.

Tustin7215
& Company, Inc.
Easy St.
 650 Safeguard Plaza Arabi, LA 70032
Brooklyn Heights, OH 44131  Email - info@tuscominc.com
 Email -  - webmaster@tuscominc.com
vendor.apps@safeguardproperties.co  Phone - (504) 812-5781
m  Fax - (504) 324-0995
 Phone - (800) 852-8306

Field Asset Services, Inc. (FAS)

Services
Five Brothers Mortgage Company
and Securing, Inc.
 9229 Waterford Centre Blvd. Suite  14156 East Eleven Mile Rd.
110 Warren, MI 48089
Austin, TX 78758  Email - MelissaS@FiveOnline.com
 Email - webmaster@fieldassets.com  Phone - (586) 772-7600 Ext: 148
 Phone - (512) 467-1537  Fax - (586) 772-3660
 Toll - (800) 468-1743
 Fax - (512) 467-1639

Premier Field Services, LLC.
 20627 Kelsey Lane

Fidelity National Financial
 Corporate Headquarters
Strongsville, OH 44149
 Email - inspector@premierfield.com
601 Riverside Ave.  Phone - (440) 336-1107
Jacksonville, FL 32204  Fax - (440) 878-9085
 Email - IMS@fnis.com
 Phone - (888) 934-3354

Sprint Mortgage Services
 P.O. Box 2669

Spectrum Field Services, Inc.
 220 East Morris Ave., Suite 400
Chino, CA 91708-2669
 Email - sales@4SMSI.COM
Salt Lake City, UT 84115  Phone - (800) 452-1881
 Email - info@spectrumfsi.com  Fax - (909) 606-7833
 Phone - (800) 700-1701
 Fax - (801) 461-8227

Advanced Mortgage Solutions
 617 Union Ave., Bldg. 3-7
Brielle, NJ 08730

Keystone Asset Management
 100 W. Main St., Suite 310
 Email -
Info@AdvancedMortgageSolutions.c
Lansdale, PA 19446 om
 Phone - (215) 855-3350  Phone - (732) 223-5144
 Fax - (215) 393-6018  Fax - (732) 223-5344

First American Field Services

 Email - caservice@firstam.com

Allcoast Financial Services, LLC
 13601 Preston Rd., Suite 801E
 Phone - (800) 873-4532 Dallas, TX 75240

31
  Email - info@allcoastservices.com
 Phone - (972) 818-7771
 Toll - (800) 818-4989
 Fax - (972) 346-6783

America’s InfoMart, Inc.
 P.O. Box 63
Allen, TX 75013
 Email - aim@quickbpo.com
 Phone - (972) 727-9500
 Toll - (800) 776-1815
 Fax - (972) 727-9800

ASD America
 5942 Edinger Ave. #113
Huntington Beach, CA 92649
 Email -
information@asdamerica.com
 Phone - (877) 333-ASDA (2732)
 Fax - (714) 901-0040

Asset One Marketing Group, LLC
 Denver Operations Center
999 18th St., Suite 1450
Denver, CO 80202
 Email - corporate@assetonemg.com
 Phone - (303) 285-9094

CBC Innovis
 5750 Rufe Snow Dr.
North Richland Hills, TX 76180
 Email -
betty.barrington@cbcinnovis.com
 Phone - (817) 428-0000
 Toll - (800) 346-2432

FIS Field Services
 Email - jason.o’donnell@fnf.com
 Phone - (440) 424-0058
 Fax - (440) 349-2148

Field Services, Inc.
 P.O. Box 212
Holly Springs, GA 30142


Email - charm@fieldservices.com
Phone - (770) 345-9277
 Toll - (800) 864-0523
 Fax - (800) 655-5055
32

Services
Goodman Dean Corporate Real Estate
 4281 Katella Ave., Suite 131
Los Alamitos, CA 90720
 Email -

contact_us@goodmandean.com
Phone - (714) 229-8999
 Toll - (800) 930-8999
 Fax - (714) 229-9143

I.C.O.M. Enterprises
 Company Headquarters
5803 N.E. 41st, Suite D

Kansas City, MO 64117
Email -
tigercleveland25@hotmail.com
 Phone - (913) 577-3600
 Fax - (816) 455-9126

The Kinnamon Group, Inc.
 1425 Spruce St., Suite 100

Philadelphia, PA 19102
Email - information@kinnamon.com
 Phone - (215) 732-5160
 Fax - (215) 732-1682

McDargh Real Estate Services, Inc.
 10006 N. Dale Marby Highway,
Suite 204
Tampa, FL 33618
 Email -
information@mcdarghconsulting.co
m
 Phone - (813) 264-0323
 Fax - (813) 968-6756

Mortgage Contracting Services
 One Urban Centre - Suite 950
4830 West Kennedy Blvd.
Tampa, FL 33609
 Email - allan.martin@mcsnow.com
 Phone - (813) 387-1100
 Toll - (866) 563-1100

Management
NVMS, Inc. (National Vendor
Services)
 9255 Center St., Suite 200
Manassas, VA 20110
  Email - info@nvms.com  Email - info@reoallegiance.com
 Phone - (703) 361-6262  Phone - (888) 727-6303
 Fax - (540) 242-3395  Fax - (201) 823-8505

Leading Edge Companies, LLC

Corporate Realty Services, LLC
 1600 Heritage Landing Suite #112
 Rod Beaver
130 E. Northfield Dr., #219
St. Charles, MO 63303 Brownsburg, IN 46112
 Email - info@crsreo.com  Email -
 Phone - (314) 704-8200 contact@leadingedgecompani
 Toll - (800) 426-5790 es.com
 Fax - (314) 667-3175  Phone - (317) 523-7355

Reliance Field Services

 A Division of the LMS Group, Inc.

M&M Mortgage Services
 Email George Mencia @
9971 Bird Rd. Gmencia@mmmortgage.com
Miami, FL 33165
 Email -
property@reliancefieldservices.com
LAMCO
 Apply online:
 Phone - (305) 554-0434
 Toll - (888) 301-0434 http://www.lendersreo.com/ap
 Fax - (305) 554-1460 plication.aspx

REO Allegiance, Inc.
Cyprexx Services

 Corporate Headquarters  Apply online:
111 Linnet St. www.cyprexx.net/Vendors/Ne
Bayonne, NJ 07002 wVendorApplication2.aspx

33
Appendix B:
HUD Pricing &
Guidelines

34
 GENERAL REQUIREMENTS FOR PRESERVATION AND PROTECTION OF
PROPERTIES SECURING FHA INSURED MORTGAGES

Mortgagee Responsibility
Mortgagees should preserve and protect properties securing FHA-insured mortgages in
accordance with the requirements of 24 CFR 203.377, which provides that “the
mortgagee shall take reasonable action to protect and preserve such security property
when it is determined, or should have been determined, to be vacant or abandoned until
its conveyance to the Secretary, if such action does not constitute an illegal trespass”. In
the event that a property securing an FHA mortgage is conveyed damaged to the
Secretary without prior approval, the Department may, at its discretion, require the
property to be re-conveyed or may require a reduction to the claim proceeds for the
greater of the insurance recovery or HUD’s estimate of the cost of repairing the damage.

Generally, the more diligent a Mortgagee is in completing timely foreclosure and

conveying a property, the lower the expenditure for preservation and protection will be.
A Mortgagee may use any individual or firm to perform preservation and protection
services on properties securing FHA-insured mortgages, however, the Mortgagee remains
fully responsible to HUD for its actions and the actions of its agents. As a cautionary
note, the Department needs to remind Mortgagees that in addition to the surcharges
discussed in this Mortgagee Letter, HUD may pursue enforcement action, including
debarment, civil money penalties and actions under the Program Fraud Civil Remedies
Act. See 24 CFR Parts 24, 28 and 30.

I.Unit Pricing
HUD has established an overall maximum cost limit (see Attachment 1) that establishes
the maximum amount that will be reimbursed for all preservation and protection expenses
on an individual property. Additionally, HUD has established maximum allowable costs
for individual types of expenses such as lawn mowing and lock changes. Any expenses
exceeding the cost allowable or exceeding the overall maximum cost limit per property
are not considered approved by HUD unless a Mortgagee has obtained prior written
approval from HUD’s designated Management and Marketing Contractor (“M&M”).
HUD will require the repayment of claimed reimbursement amounts if it determines that:
• Amounts paid for reimbursement were unnecessary and excessive;
• The Mortgagee obtained bids that were not independent and competitive;
• Services claimed were not performed or not performed properly; or
• The amount claimed exceeded the cost allowable or overall maximum
allowable limit
and the Mortgagee did not obtain advance written approval.

To facilitate the timely securing of abandoned properties, HUD has pre-authorized

Mortgagees to spend up to a set amount per property for expenses directly related to
initial securing. This maximum securing limit is included within the overall maximum
allowable limit as further described in Attachment 3.

35
 Some types of expenses such as the cost of boarding, inspections, securing swimming
pools, sump pumps, demolition and utilities are not included in the maximum cost limit
per property. These services will be reimbursed, provided costs stay within the cost
allowables listed in Attachments 2, 3, 4, and 7.

A Mortgagee should support all expenditures, including costs associated with the
aforementioned exceptions, with receipts and photographs. For the purpose of claiming
reimbursement, HUD considers actions identified in this Mortgagee Letter to be pre-
approved, provided these actions meet all applicable cost limits and are performed in
accordance with the work requirements identified in this Mortgagee Letter.

II. Claim Submission and Documentation

HUD will reimburse Mortgagees for preservation and protection actions in accordance
with the provisions of this Mortgagee Letter upon receipt of Form HUD-27011 Parts
A&B via Electronic Data Interchange (EDI) or via the FHA Connection. For instructions
on claim processing and document submission see HUD Handbook 4330.4, rev.-1,
change 1, which is available on “www.hudclips.org”. Documentation to support each
claimed expense must be maintained in the Mortgagee’s case file and must be provided to
HUD or its M&M contractor upon request. The documentation should support the
expenditures and illustrate that the Mortgagee took appropriate action to preserve and
protect the property from the time of default to conveyance. Examples of appropriate
documentation include copies of all inspections, photographs, receipts, and overallowable
approval requests.

Also on the date the deed is filed for record or mailed to the recording authority,
Mortgagees must send a paper copy of the HUD-27011 Part A to HUD’s M&M
contractor having jurisdiction for the subject property. If the property suffered
surchargable damage and the mortgagee has received permission to convey the property
un-repaired, Mortgagees shall note “yes”on the Part A form, Item 24, “Is the property
conveyed damaged?”. Where item 24 is marked “yes”, Mortgagees must also include the
date that HUD gave permission to convey damaged in item 25 and also include greater of
the insurance recovery or HUD’s estimate of the cost of repairs in item 27

Where the damage to the property is non-surchargable, item 25 should be marked

“no”and the Mortgagee shall included an explanation of the non-surchargeable damage in
the Mortgagee’s Comment Section of Part A. See additional guidance in HUD
Handbook 4330.4, rev.-1, change 1, which is available on “www.hudclips.org

Mortgagees are prohibited from performing preservation and protection services after
Part A of Form HUD 27011 has been filed. However, payment of certain utility bills
may be considered an exception to this guideline (see Attachment 7).

36
III. Conveyance of Damaged Properties

A. Surchargeable Damage
All properties conveyed to HUD should be undamaged by fire, flood, earthquake,
tornado, hurricane, or boiler explosion (for condominiums) or damage resulting from
Mortgagee neglect. Costs resulting from these types of damage are considered
surchargeable and are excluded from the claim for insurance benefits. The Mortgagee
must repair the damage or obtain prior written permission from HUD to convey a
property with surchargeable damage.

1. Damage Due to Failure to Preserve and Protect (Mortgagee Neglect)

HUD will hold a Mortgagee liable if its failure to take reasonable action to preserve and
protect property that it determined or should have been determined to be vacant or
abandoned results in property damage or destruction. Examples of Mortgagee neglect
include but are not limited to a Mortgagee’s failure to:

a. Initiate foreclosure within the required timeframe

b. Obtain timely and accurate property inspections;
c. Promptly secure and continue to protect all abandoned properties; or
d. Promptly notify HUD’s M&M contractor of receipt of code violations and demolition
notices and take appropriate action.

2. Limitation on Fire Damage

Mortgagees are liable for the full cost to repair fire damage whether or not the damage
was the result of Mortgagee neglect. However, if the property is damaged by fire and is
not covered by fire insurance or the amount of insurance coverage was inadequate to
fully repair the damage, the Mortgagee’s liability may be limited to the amount of the
insurance recovery received by the Mortgagee, if any, provided that the Mortgagee
certifies that all of the circumstances specified in 24 CFR 203.379(a)(2) exist.

3. Damage Due to Mold

A property may be conveyed with mold if the mold was not caused by a surchargeable
condition, including Mortgagee neglect, fire, flood, earthquake, hurricane, or for
condominiums, by boiler explosion. However, even if the mold was not caused by a
surchargeable condition, the failure by the Mortgagee to take reasonable action to
remediate the cause of the mold and complete any other required preservation and
protection actions related to minimizing further mold damage prior to conveyance of the
property, qualifies as Mortgagee neglect and, is surchargeable.

4. Requesting Approval to Convey with Surchargeable Damage

Mortgagees may not convey properties that have surchargeable damage unless the Department provides
prior written approval. Until further notice, such approval

37
shall be provided by the appropriate M&M Contractor having jurisdiction over the
subject property. (24 CFR 203.379(b).
Such requests for approval should be sent by facsimile or email to the appropriate M&M
contractor. The M&M contractor should review and respond in writing to the request
either by fax or e-mail no later than 10 business days following receipt. HUD, at its sole
discretion, may require that the Mortgagee repair the damage prior to conveyance or may
elect to accept conveyance of the property in damaged condition and require that the
claim for insurance benefits be reduced by the greater of the insurance recovery or by the
government’s estimate of the cost of repairs. If HUD requires the Mortgagee to repair
property damages before conveyance, HUD will not reimburse the cost of these repairs.

If the claim is adjusted for damages, the Mortgagee should mark item 24 of Part A, Form
HUD-27011, “yes” and complete items 26 and 27. Please note that HUD’s claim system
will suspend the claim, delaying payment, if the mortgagee has noted “yes” in item 24
without providing the date of approval in item 26 and the amount of the claim reduction
in item 27.

As a matter of administrative practice, HUD generally will not deny conveyance of

properties if the government’s estimate of the cost to repair the surchargable damage is
equal to or less than $2,500.

5. Surchargeable Damage Conveyed Without Approval

When a property with surchargeable damage is conveyed without prior approval, HUD
may, at its sole discretion, either re-convey the property to the Mortgagee or seek
reimbursement from the Mortgagee for HUD’s estimate of the cost of the repairs (24
CFR 203.379(c)). If HUD’s estimate is equal to or less than $2,500, HUD will generally
reduce the claim payment by the cost to repair the property damage rather than exercise
its right to re-convey. Only a HUD Government Technical Representative (GTR) has
authority to approve a re-conveyance demand. The M&M contractor will provide a
preliminary email notification that a property may be re-conveyed as a result of property
damage within 30 days of the date of conveyance.

The email will identify the reason(s) for the proposed re-conveyance and provide the
Mortgagee an opportunity to respond with additional information. If additional
information is received from the Mortgagee within 10 business days from the date of the
email, it will be included in the package provided to the GTR for a decision. The GTR
will, no later than 60 calendar days of the date of conveyance, make the final decision to
take no action, issue a Notice to Re-convey or issue a Demand Letter.

The process for appealing the decision of the GTR is described in Attachment 10,
Mortgagee Appeal Process.

38
 Properties Conveyed with Non-Surchargeable Damage
If a property has sustained non-surchargeable damage, the Mortgagee is not required to
obtain pre-approval before conveyance. However, the Mortgagee must include a
description of the damage in the “Mortgagee’s Comments” section of the Form HUD-
27011, Part A. Item 24 of Part A, “Is the property conveyed damaged?”, should be
marked “no”. (Note: marking “yes” in item 24, triggers HUD’s claim system to look in
item 26 for the date of HUD’s approval to convey the property damaged and to item 27
for the amount that the claim is to be reduced. Mortgagees must indicate “yes” for
surchargable damage and “no” for non-surchargable damage.)

Additionally, the Mortgagee must include, along with the copy of the claim sent to
HUD’s M&M Contractor, documentation supporting the preservation and protection
work performed on the property. At a minimum, this documentation should include
evidence of the date of first vacancy, validation of the property condition at first vacancy
and a chronology of actions performed by the Mortgagee to preserve and protect the
property.

If a Mortgagee fails to provide the required explanation in the Mortgagee’s Comments

section of the Part A or fails to provide the required documentation of P&P actions, the
M&M Contractor will notify the Mortgagee in writing that the Mortgagee has 10
business days to provide the information. If no documentation or inadequate
documentation is received from the Mortgagee the damage will be considered
surchargeable.

IV. Quality Control

In accordance with 24 CFR, Part 202.5(h) all FHA approved Servicers are required to
implement a written quality control plan covering all aspects of loan origination and
servicing and to conduct regular quality assurance reviews in accordance with the plan.
Servicing quality control plans should incorporate quality assurance reviews of
preservation and protection responsibilities including a review of work performed by
third party field service contractors and other vendors. A Servicer is required to provide
a copy of its quality control plan as well as results of quality assurance reviews to HUD
staff either during regularly scheduled servicing and post claim audit reviews or upon
request. All information collections in quality control are covered under the Office of
Management and Budget (OMB) Control Number 2502-0005.

39
40
ATTACHMENT 1 Maximum Allowable Cost Per Property
Maximum Allowable Cost Per Property
State 1 Unit 2 Units 3 Units 4 Units
Alabama $800 $950 $1,100 $1,250
Alaska $1,400 $1,550 $1,700 $1,850
Arizona $1,100 $1,250 $1,400 $1,550
Arkansas $1,100 $1,250 $1,400 $1,550
California $1,100 $1,250 $1,400 $1,550
Caribbean $1,100 $1,250 $1,400 $1,550
Colorado $1,100 $1,250 $1,400 $1,550
Connecticut $1,800 $1,950 $2,100 $2,250
Delaware $1,400 $1,550 $1,700 $1,850
District of Columbia $1,400 $1,550 $1,700 $1,850
Florida $1,100 $1,250 $1,400 $1,550
Georgia $1,100 $1,250 $1,400 $1,550
Idaho $1,100 $1,250 $1,400 $1,550
Illinois $1,400 $1,550 $1,700 $1,850
Indiana $1,100 $1,250 $1,400 $1,550
Iowa $1,300 $1,450 $1,600 $1,750
Kansas $950 $ 1,100 $1,250 $1,400
Kentucky $1,100 $1,250 $1,400 $1,550
Louisiana $1,100 $1,250 $1,400 $1,550
Maine $1,650 $1,800 $1,950 $2,100
Maryland $1,550 $1,700 $1,850 $2,000
Massachusetts $1,650 $1,800 $1,950 $2,100
Michigan $1,400 $1,550 $1,700 $1,850
Minnesota $1,400 $1,550 $1,700 $1,850
Mississippi $1,100 $1,250 $1,400 $1,550
Missouri $950 $1,100 $1,250 $1,400
Montana $1,100 $1,250 $1,400 $1,550
Nebraska $1,500 $1,650 $1,800 $1,950
Nevada $1,100 $1,250 $1,400 $1,550
New Hampshire $1,650 $1,800 $1,950 $2,100
New Jersey $1,400 $1,550 $1,700 $1,850
New Mexico $1,100 $1,250 $1,400 $1,550
New York $1,400 $1,550 $1,700 $1,850
North Carolina $1,100 $1,250 $1,400 $1,550
North Dakota $1,100 $1,250 $1,400 $1,550
Ohio $1,400 $1,550 $1,700 $1,850
Oklahoma $1,100 $1,250 $1,400 $1,550
Oregon $1,100 $1,250 $1,400 $1,550
Pacific/Hawaii $1,100 $1,250 $1,400 $1,550
Pennsylvania $1,400 $1,550 $1,700 $1,850
Rhode Island $1,650 $1,800 $1,950 $2,100
South Carolina $1,100 $1,250 $1,400 $1,550
South Dakota $1,100 $1,250 $1,400 $1,550
Tennessee $1,100 $1,250 $1,400 $1,550
Texas $1,100 $1,250 $1,400 $1,550
Utah $1,100 $1,250 $1,400 $1,550
Vermont $1,650 $1,800 $1,950 $2,100
Virginia $1,400 $1,550 $1,700 $1,850
Washington $1,100 $1,250 $1,400 $1,550
West Virginia $1,100 $1,250 $1,400 $1,550
Wisconsin $1,400 $1,550 $1,700 $1,850
Wyoming $1,100 $1,250 $1,400 $1,550
Note: If a property is located in a state where winterization is required, and the property has hot
water heat, add $250/unit

41
ATTACHMENT 2 Property Inspection Service Requirements and Cost
Schedule
Vacant and abandoned properties are potential targets for vandalism, weather damage and
criminal activity. Additionally, they present an attractive nuisance that poses a hazard to children
and others who may be injured. To ensure the preservation of the mortgage collateral and lessen
the negative community impact of vacant properties, Mortgagees must conduct regular property
inspections. Mortgagees may include the cost of these inspections in a claim for insurance
benefits within the limits described in this section. Claim amounts paid for inspections are not
included in the maximum cost limit per property.

There are five types of property inspections: Occupancy Inspections, Initial Vacant Property
Inspections, Vacant Property Inspections, Voluntary Pre-Conveyance Inspections and Eviction
Inspections. HUD form 9519-A, “Property Maintenance Inspection Report” may be used to
document and support each claimed inspection/expense. Before and after photographs are
required on all property visits where any claimable property preservation action is taken. Also,
all inspections are to be documented. Photographs and inspection reports should be maintained in
the Mortgagee’s claim review file and must be provided to HUD or its contractors upon request.
Information collection activity for inspections and photographs is covered under the Office of
Management and Budget (OMB) Control Number 2502-0306 and documentation related to claim
submission and claim file retention are covered under OMB Control Number 2502-0429.

Mortgagees may be surcharged for the cost of property damage if inspection reports are
inaccurate, incomplete, untimely or insufficient in determining a verifiable timeline as to when
damage occurred.

I. Occupancy Inspections
When a mortgage is in default, a payment is not received within 45 calendar days of the
due date, and efforts to reach the Mortgagor by telephone or correspondence within that
period have proven unsuccessful, the Mortgagee must make an Occupancy Inspection in
accordance with the guidelines herein to determine if the property is vacant or abandoned
(24 CFR 203-377).

The Occupancy Inspection may determine that the property is (i) occupied (ii) vacant but
obviously being maintained (e.g., doors and windows secured, lawn is cut, For Sale sign
on the property, etc.) or (iii) vacant and abandoned. Regardless of the result of the
occupancy inspection, so long as the Mortgagor continues to be in default on the
mortgage, the Mortgagee should endeavor to establish and/or maintain monthly telephone
contact with the Mortgagor. If there is no documented telephone contact with the
Mortgagor for any period of 25-35 days from the last contact or the last Occupancy
Inspection, the Mortgagee shall conduct another Occupancy Inspection.

If the Occupancy Inspection establishes that the property is vacant but obviously being
maintained, on-going Occupancy Inspections should be conducted every 25-35 days
following the previous documented telephone contact with the Mortgagor or previous
Occupancy Inspection so long as the mortgage remains in default.

42
 If the Occupancy Inspection establishes that the property is vacant and abandoned, the
Mortgagee should initiate preservation and protection actions and the related measures
required to secure the property beginning with an Initial Inspection.

A. Inspection without Monetary Default

Mortgagees should also perform a visual inspection of a property where there is reason to
believe that the property has become vacant or abandoned, even if the property is not in
monetary default. Examples of information that might indicate vacancy or abandonment
include, but are not limited to (i) written notice of code violation, municipal lien,
condemnation or demolition (ii) disconnection of utilities or (iii) cancellation of
homeowner insurance. Mortgagee should verify occupancy through either (i) direct
Mortgagor contact by telephone or (ii) Occupancy Inspection. Mortgagees should
maintain file documentation supporting the need for and results of the inspections on
properties where there is no monetary default.

B. Inspection During Bankruptcy

HUD regulations provide that if the mortgage is in default and the Mortgagee is
unsuccessful in contacting the Mortgagor by telephone, the Mortgagee should perform a
visual inspection of the property to determine whether it is vacant, and if so, protect and
preserve the property. In cases where the Mortgagor has filed bankruptcy, and the
Mortgagee is prohibited from contacting the Mortgagor, supporting documentation must
be maintained in the claim review file to confirm this prohibition.

In such cases, Mortgagees will not be required to conduct interior inspections (or perform
other preservation and protection actions), until such time as there is no longer a stay in
place barring the Mortgagee from collection activities, or the bankruptcy court has
granted approval for the Mortgagee to take any required preservation and protection
actions.

The Mortgagee should take all actions permitted under bankruptcy law and should
diligently pursue seeking any necessary permission from the bankruptcy court to inspect
and/or protect and preserve the property where no payments are being made and there is a
suspicion of abandonment. HUD will reimburse for such actions, where: 1) the
Mortgagee learns that the property is or may be vacant, 2) the Mortgagor is not
performing as required by the bankruptcy court, or 3) bankruptcy is no longer a bar to
foreclosure which includes but is not limited to, termination of the automatic stay or the
trustee has formally abandoned the property.

C. Report Contents
The Occupancy Inspection report should, at a minimum include the following:
• Date of the occupancy inspection.
• Identity of the inspector.
• Is the property occupied? If so, how was this determined?
• Identity and status (i.e. Mortgagor, renter, etc.) of occupants, if ascertainable
• A valid telephone number for the occupant, if ascertainable.
• Is the house locked or secured?

43
 • Is there a For Sale sign on the property? If so, provide the Broker name and
contact
number.
• Is the grass mowed and/or shrubs trimmed?
• Is there any damage apparent from the exterior? Describe.
• Is any exterior glass broken? Describe.
• Are any doors or windows boarded? Describe.
• Does the house appear to contain personal property and/or debris?

If the Inspection indicates that a property is occupied, the Mortgagee or its agent should
attempt to verify the identity of the occupant(s). If it is not clear whether a property is
occupied, the Mortgagee should review such occupancy indicators such as (i) checking
utility meters to determine if they are on (ii) contacting the listing broker if there is a for
sale or rent sign on the property (iii) observing general maintenance and (iv) speaking to
neighbors. A drive-by inspection alone is not acceptable evidence of occupancy or
vacancy.

II. Initial Vacant Property Inspection

An Initial Vacant Property Inspection, also called the “Initial Inspection”, is performed
on the date a Mortgagee first takes physical possession of a property by securing it.
Securing should take place as soon as reasonably practical, but no more than five
calendar days following the determination that the property is vacant and/or abandoned
post foreclosure or 15 business days following the determination that the property is
vacant and/or abandoned, pre-foreclosure. If the Initial Inspection identifies an imminent
source of property damage or a health and safety hazard (e.g., flowing water, collapsed
roof, gas leak), the Mortgagee must take immediate action to remediate the
damage/hazard. Where emergency permission could not be obtained in advance of the
repairs, the Mortgagee shall submit an over-allowable request immediately following
completion of the work and substantiate the emergency nature of the repairs.

In some instances the Initial Inspection will take place on the same date as the Occupancy
Inspection. In these cases, the Mortgagee may only claim the cost of the Initial
Inspection. The Initial Inspection report establishes the condition in which the Mortgagee
first found the property, and may be of critical importance in distinguishing between
Mortgagor and Mortgagee neglect, following conveyance.

A. Report Contents
Mortgagees should be diligent in documenting property condition through written
descriptions and photographs during each inspection but especially at the Initial
Inspection. The Initial Inspection report should describe the (i) condition of the property
when the Mortgagee or its agent arrived; (ii) actions taken by the Mortgagee to preserve
and protect the property during the initial securing and (iii) required actions to be
performed. At a minimum the Initial Inspection report should include:
• Date of the initial vacant property inspection.
• Identity of the inspector.

44
• Date of last occupancy inspection?
• Is the house locked or secured?
• Is the grass mowed and/or shrubs trimmed?
• Is there any apparent damage? Describe.
• Is any exterior glass broken? Describe.
• Are there any apparent roof leaks? Describe.
• Does the house contain personal property and/or debris? List all and
document with photographs.
• Are any doors or windows boarded? Describe.
• Is the house winterized? If not, when and where applicable, initiate
winterization service (see Attachment 7).
• Are there any repairs necessary to adequately preserve and protect the
property? Describe.
• Which appliances are present?
• Describe any P&P actions completed during initial securing.
• Describe any additional P&P actions required.

B. Posting Signage
During the Initial Inspection, Mortgagees should post a small sign no larger than 8.5” x
11” on an interior window or the front door of a property. The sign should not include
information about pending foreclosure or the M&M Contractor, but should contain the
Mortgagee’s toll free telephone number and/or the telephone number of the Mortgagee's
local representative to contact in case of emergency. There is no allowable cost to post
signs.

III. On-Going Vacant Property Inspections

On-going Vacant Property Inspections are performed after the Initial Inspection and
securing have occurred. The Mortgagee should inspect a vacant or abandoned property
every 25-35 days following an Initial Inspection, or more frequently as prescribed in local
variations (see Local Variation from General Requirements, page 13), to determine
whether any subsequent or additional preservation and protection action is necessary.
Vacant Property Inspections should include both interior and exterior assessments of
property condition.

At a minimum the Vacant Property Inspection report should include the items listed in
2A above.

IV. Voluntary Pre-Conveyance Inspections

A number of Mortgagees have requested the opportunity to conduct a joint property
inspection with M&M contractors prior to conveyance. HUD encourages, but does not
require, Mortgagees or M&M contractors to conduct Pre-Conveyance Inspections. Pre-
Conveyance Inspections may significantly reduce post-conveyance disputes between
Mortgagees and M&M contractors by allowing each party to agree that properties are in
conveyance condition or identify additional requirements that should be met prior to
conveyance. This is especially beneficial when properties will be conveyed damaged, as

45
it will allow the Mortgagee to demonstrate that the damage is not surchargeable, thereby
reducing the likelihood of demand letters, re-conveyance, or other sanctions.
Pre-Conveyance Inspections should be scheduled no earlier than five calendar days prior
to the scheduled conveyance date. HUD will allow Mortgagees to claim the cost of one
additional inspection, claimed at the rate of a Vacant Property Inspection, provided the
Pre-Conveyance Inspection does not coincide with the regular inspection schedule.

Mortgagees should contact the appropriate M&M contractor directly for further
information on procedures regarding voluntary Pre-Conveyance Inspections in their
contract areas. The M&M contractor, using HUD’s inspection form, will perform
voluntary Pre-Conveyance Inspections.

At a minimum the Pre-Conveyance Inspection report should include the items listed in
2A above.

V. Pre-Eviction Inspections
Mortgagees are required to perform a Pre-Eviction Inspection within 72 hours of a
scheduled eviction, whenever there is any doubt that a property is still occupied. The Pre-
Eviction Inspection will be reimbursable as an Occupancy Inspection. When an
Occupancy Inspection is already scheduled for the same week as the eviction, only one
inspection fee will be reimbursed. Mortgagees are reminded to confirm the scheduled
eviction the day before or morning of the scheduled eviction to be eligible to claim one
hour of labor per person for a canceled or rescheduled eviction. Mortgagees should
document in the claim review file, the name of the person or place called, the date and
time of the call and results of the call.

At a minimum the Pre-Eviction Inspection report should include the items included in the
Occupancy Inspection as listed in 1C above.

VI. Inspection Cost and Frequency

The reimbursable cost limits for Inspections are as follows:

Property Inspection Cost Schedule (NATIONWIDE)

Occupancy Inspections (Exterior) $20

Occupancy Inspection (Addt’l Units) $10
Initial Vacant Property Inspection (Interior) $35
Initial Vacant Property Inspection (Addt’l Units) $30
Vacant Property Inspection (On-going) $30
Vacant Property Inspection (On-going/Addt’l Units) $25

The cost of inspections is not included in the overall P&P maximum. Generally,
not more than 15 inspections per calendar year may be claimed unless indicated
otherwise under local variations. In cases of a declared natural disaster see
Mortgagee Letter 2005-41.

46
 Local Variations from General Requirements

ATLANTA Homeownership Center

Chicago, Illinois
Properties should be inspected twice per week, year-round in the following zip codes (hot-
zones):
60609 60615 60621 60627 60628 60635
60636
60639 60641 60644 60647 60651 60653

SANTA ANA Homeownership Center

Alaska
During all inspections, inspectors should verify that all properties are winterized and if not
notify the servicer to arrange for winterization immediately as Alaska properties should be
winterized year-round.

Los Angeles, California

Properties should be inspected twice per week, year-round in the following zip codes:

90001 90002 90003 90220 90221

ATTACHMENT 3 Lock Changes/Securing Service Requirements and Cost

Schedule
Properties must be secured to prevent unauthorized entry and protect against weather
related damage. The cost schedule to this attachment includes a Maximum Allowable
Securing Fee for securing that includes the minimum securing requirements identified in I.
below, as well as a flat fee for photographs. This attachment also identifies maximum
allowable fees for securing swimming pools and completing temporary roof repairs, which
are not included in the Maximum Allowable Securing Fee. The securing requirements
listed below may be performed without prior approval from the M&M contractor if all
individual expenses remain within the maximum cost allowable for that particular service.

Written approval from the M&M contractor is required if the cost exceeds the maximum
allowable for any particular service listed herein. Re-securing the property is allowed
without prior approval, provided the costs are within the maximum allowable securing fee.

I. Minimum Securing Requirements

1. All windows and doors must be secured.

47
2. Broken glass should be replaced, unless the opening is to be boarded. All
broken glass should be removed.
3. Locks on the front and rear entry doors should be replaced with one of the
following master lock sets:

Kwikset No. 400T

Kwikset No. 400P

Kwikset No. 400V or equivalent, with identical key codes.
4. If there is a deadbolt lock on the main entry door replace handle set with a
Kwikset lock or equivalent and disable the existing deadbolt.Other entryways that provide
immediate access to the living area, attached garage or basement area should be secured
with a slide bolt, unless otherwise noted in variations. Or, if the secondary entryway has
an existing deadbolt lock, re-key the deadbolt to the specifications of the front and rear
entry doors.
5. Document key-codes to the existing/replacement lock in the Mortgagee’s
Comments section of Form HUD 27011 Part A, which should be provided to the M&M
contractor.
6. Doors should not be braced or nailed shut or the Mortgagee will be held
accountable for resulting damage.
7. Sliding glass doors should be double locked.
8. Detached garage doors and outbuildings should be secured with a padlock and
hasp.
9. Unplug automatic garage door openers and secure garage doors, when
applicable. Garage doors should be left in such a condition as to allow for opening and
closing without the use of the automatic garage door opener. Leave the remote
key(s)/transmitter(s) in a kitchen counter drawer.

II. Temporary Roof Repair

Roof damage left unattended exposes a property to deterioration; moisture accumulation
and mold growth. A separate cost item in the amount of $400 has been created for
temporary roof repair to protect the interior of properties from further damage. M&M
approval is not required if the cost of the temporary repair does not exceed the maximum
allowable amount of $400. The Mortgagee should submit Form HUD-50002, “Request to
Exceed Cost Limits for Preservation and Protection,” for any temporary roof repair that
exceeds the maximum allowable for roof repair. Temporary repairs (e.g.,
tarping/patching/or replacing loose shingles) should be performed immediately upon
discovery of roof damage. Tarps and other temporary measures may be used to prevent
further deterioration only until permanent repairs can be completed.

If a property has sustained roof damage that is not surchargeable and the property is
scheduled for conveyance within 30 days of the date a roof leak is discovered, the
Mortgagee may convey the property with a tarp or other temporary repair. Mortgagees
should notify the M&M in advance when they will convey a property with a temporary
repair and should provide evidence that the damage is not surchargeable and was only
recently discovered. Failure to provide this notification may result in re-conveyance.

If the damage is discovered 31 or more days prior to the conveyance date, the Mortgagee
should affect a permanent roof repair, whether or not the damage is surchargeable. If the

48
 cost to permanently repair the roof exceeds the cost allowable for this item, the Mortgagee
should submit an over-allowable request.

Properties with surchargeable roof damage may not be conveyed with a tarp or other
temporary repair without the prior approval of the M&M contractor.

Mortgagees should retain before and after photographs and a detailed description of what
actions were taken to prevent further roof deterioration or water leakage. The
documentation must be maintained in the claim review file to support the reimbursement
of the costs claimed.

III. Swimming Pools

Fees for securing or winterizing swimming pools and hot tubs or spas are not included in
the maximum allowable limit per property. See below for the maximum costs for securing
pools and spas. The costs for permits to drain pools/spas by local governments are
included in the maximum limit for this cost item and will be reimbursed based on the
actual cost incurred. Prior written approval from the M&M contractor is not required for
securing or winterizing pools unless noted otherwise in variances below. Before and after
photographs are required. At a minimum the Mortgagee should:
• Pump out pool leaving 4 feet of water in the deep end (this amount may vary
depending on the elevation). After pumping, apply chlorine to control the algae in the
remaining water. Circulate remaining water to mix chlorine. Isolate and drain pumps and
filters. Remove all trash from interior of pool and haul away.
• If there is a pool cover present, secure and cover pool. Check with state and
local codes to verify whether the pool should be fenced.
• If there are no jurisdictional requirements, and no existing pool cover, secure
according to the diagram on page 17. However, no pool cover is required in Arizona,
California. Hawaii, Nevada and Other Pacific Islands.
Secure entrance gates to fences surrounding pools with a lock or padlock and chain when
no lock is present.
Replace any damaged or missing boards or sections of fence surrounding pools.

If the property has an above ground pool in good condition, built up with decking or other
infrastructure that will support a pool cover, treat it as an in-ground pool. Above ground
pools in poor condition or that cannot be secured in accordance with the guidelines herein,
should be removed. If an above ground pool is removed, remediate any depression in the
ground that might constitute a hazard.

WARNING: Check local area standards before draining pool. In areas where there is a
high ground water level, removing too much water may cause pool uplift and damage the
pool.

IV. Photographs
Effective for all claims filed 30 days from the date of this Mortgagee Letter, preservation
and protection actions should be documented using digital photography. Rather than
establishing a maximum allowable number of photographs and reimbursing Mortgagees

49
on a per picture basis, HUD will provide a flat fee reimbursement of $30.00 for
photographs, regardless of the number of pictures required. The photographic fee is
included in the lock change/securing maximum allowable cost per property.

Photographs are required to document inspections, initial property condition, one-time

securing service, boarding, yard maintenance, debris removal, winterization and personal
property/debris removal as part of an eviction. The Mortgagee should photograph the
exterior and interior of the property at the time of the Initial Inspection. All photographs
should be dated and maintained in the Mortgagee’s claim review file and made available
to HUD or its M&M contractor upon request. If photographs cannot be produced at the
time of the claim review, all unsupported expenses beyond allowable cost limits will be
disallowed, and for evictions, all expenses claimed for personal property/debris removal
will be disallowed.

V. Lock Change/Securing Service Costs

The reimbursable cost limits for Lock Change/Securing are as follows:

Lock Change/Securing Service Cost Schedule (NATIONWIDE)

Secure One Door $40

Secure Pool (Sq. Ft. Amt.) $2.05
Maximum Secure Pool $1050
Secure Hot Tub, Jacuzzi, Spa $55
Maximum Allowable for Lock Change/Securing $350

Local Variations from General Requirements for Securing Pools and Spas

ATLANTA Homeownership Center

Indiana
Use 1”, 2”, or 3” x 4” hex netting to cover pool. Seams should be covered with 1” wood
strips for securing.

SANTA ANA Homeownership Center

Arizona/California/Hawaii/Nevada/Other Pacific Islands

Do not cover pools. However, pools should be drained and secured according to the guidelines set forth on
page 15.

50
 Add cross bars every 16” on center to framing
for added strength and support. ATTACHMENT 4
Boarding Service Requirements and Cost Schedule
Mortgagees should not board a property unless they have prior written approval
from the M&M contractor, and/or:
• The property is severely damaged by fire, flood or other natural disaster;
• The property should be secured for safety reasons;
• The property is in a high vandalism area and boarding is the only reasonable
means to protect the security of the property;

51
• The property is located in a pre-approved boarding area.

When boarding is appropriate, all first floor windows and doors and all basement
windows and doors should have plywood covering the entire opening and frame.
The covering should be secured with carriage bolts. The use of nails is prohibited.
The cost of boarding properties is not included in the maximum allowable limit
per property. Before and after photographs are required. HUD will not reimburse
the Mortgagee for unauthorized boarding. Mortgagees should request prior
written approval from the M&M contractor if the cost of securing a severely
damaged property exceeds $550.
There should be no boarding above the first floor unless entry is possible without
use of a ladder, and the opening is large enough for a person to easily pass
through. Openings above the first floor that do not meet this test should be
secured but not boarded. Second story and higher openings are typically
accessible only from attached properties, stairwells or fire escapes. If security bars
are located on windows/doors, boarding is not required. Openings too small for a
person to pass through, particularly pet openings in doors, should be secured but
not boarded. To ensure that no hazards exist, remove all broken glass from the
windows and surrounding interior and exterior areas.

All properties should be boarded in accordance with local codes. If local codes
differ from HUD requirements herein, local codes supersede.

For the purpose of this document, the definition of united inch is length plus
width.

I. Specifications for Plywood Boarding

1. Exterior Plywood should be of un-sanded CDX grade.
2. Plywood thickness should be 1/2” for window openings, 5/8” for door
openings and 3/4” for sliding door and French door openings. When extra
large window openings are encountered use 5/8” or 3/4” as necessary.
3. All holes should be drilled to accommodate bolts. The holes in the top of the
plywood should be 12” down from the top and 20% of the width of the
plywood cover in from the side.
4. The holes in the bottom should be 25% of the height of the plywood, up from
the bottom and the same distance in from the side as the top.
5. Carriage bolts mated with nut and 23 flat washers as shown in the side view.
Washers to be of sufficient size to fully accept the square portion of bolt
beneath head. Bolt and mating hardware may be galvanized or cadmium
plated. 3/8” x 12” bolts should be supplied with each 2’8’ door, 3’0” door, and
glass sliding door cover. 3/8 x 10” bolts should be supplied with the rest.
6. 2” x 4” lumber should be graded and should be a minimum of 16” longer than
the width of the plywood cover. (Note: 2x4s will be drilled with 1/2” diameter
holes that line up with the holes in the plywood covers.)
7. All windows and doors, except the front door, through which access to the
interior of the dwelling is made, should be secured. All window boards will be

52
 cut to fit inside the concrete block or brick opening with a maximum 1/8”
clearance. THE PLYWOOD COVERING SHOULD BE OF ONE
CONTINUOUS PIECE WHEN POSSIBLE.
8. All fabricated parts and ancillary materials become property of HUD of
Housing and Urban Development.
9. All coverings are to be fabricated according to the attached drawing and
specifications.

II. Boarding Windows

1. Except as noted below, all window sashes, frames glass and hardware are
to be undamaged by the boarding installation.
2. All screen inserts are to be removed, marked as to location and stored in a
convenient closet or in the utility room.
3. In all cases where it is possible to adjust the position of the sashes to
accommodate the specifications for boarding above, the sashes are to
remain in the frame.
4. In instances wherein the sashes cannot be adjusted to accommodate the
boarding specifications above, the sashes are to be removed from the
frames and stored in a convenient closet or in the utility room. This
includes all stationary lights secured by stops.
5. In cases wherein the sash cannot be removed and/or the frame is
permanently built into the house and cannot be removed (i.e.: Fenestra
windows) it will be necessary to break the corner panes to accommodate
the boarding and bolts. If the location of bolt holes, in the plywood,
requires modification because of the muntin bar (a small bar that divides a
windows glass), these locations are to be modified. In no case, in any type
of window, is any sash or frame part to be damaged.
6. In all instances where items should be removed from the frame and stored,
the items should be clearly marked as to the area from which it was
removed.
7. All items are to be stored on edge and braced to prevent accidental tipping,
sliding, etc. In no instance is any item to be stored laid flat.
8. Hinged windows are to be completely removed from the frame and stored
as stated in (7) above. If possible the hinge pins are to be removed and
remain with the removed item.
9. Faced nailing of panels to wood frame windows is prohibited.

Note: Costs below are per United Inch. Definition - United Inch equals length
plus width.

Boarding Cost Schedule (NATIONWIDE)

Boarding 1/2" Boarding 5/8" Boarding 3/4" Screening

$0.80 $0.90 $1.00 $0.55

53
 Local Variations from General Requirements

ATLANTA Homeownership Center

Illinois

Install cloth screening. Cloth screen first floor openings in zip codes:
60429 60426 60411 60466 60477 60443

Screening of wood windows is accomplished by framing the window with 2x2s. The
screening is stapled over the frame and fastened with 1x2 furring laths.

Chicago, Illinois
Install Plywood boarding in the following pre-approved Chicago zip code areas following
the Chicago boarding requirements below.

60608 60609 60610 60612 60615 60616

60617 60619 60620 60085 60621 60622
60623 60624 60627 60628 60636 60637
60643 60644 60649 60651 60653

Rule 1. All openings in a structure which may be accessed from ground level and/or
within 8 feet in any direction of an exterior stairway, fire escape, ramp, porch or other
exterior construction reachable from ground level or a public way should be secured to
prevent entry by unauthorized persons. One building entrance should be secured with a
door of either solid core wood or steel construction, having no window in the door, and
the door should be securely locked to allow access only to authorized persons. Said door
should be secured with a through-bolted hasp and padlock if the door swings in.

Materials
Rule 2. If plywood materials are used to secure buildings, such materials should be no
less than 5/8-inch thick, exterior grade. Particleboard, wafer board, masonite or other
similar materials should not be used for purposes of boarding-up a building.

Rule 3. Mechanical fasteners used for wood board-up materials should be round-head,
non-slotted carriage bolts no less than 3/8-inch in diameter with washers and nuts on the
interior face.

Installation Methods
Rule 4. The primary method of securing plywood boards should be by the use of
through-bolt compression fastening, using plywood on the exterior face and wood
bracing constructed of minimum 2-inch by 4-inch (nominal) lumber installed on the
interior side of the opening to be secured, perpendicular to the long dimension of the
opening. Such bracing should extend at least 6 inches beyond the edge of the opening on
each side in order to be securely braced against the building structure.

54
Rule 5. Wood construction used to secure a building opening should contain at least one
bolt in each corner and additional bolts no more than four feet on center continuously
along the perimeter. Each bolt should fully penetrate the wood bracing on the interior
side of the opening.

Rule 6. In the event that the through-bolt compression fastening is impossible due to the
construction or condition of the opening, the opening should be covered with plywood
secured with minimum 3-inch-long wood screws fastened on 4-inch centers around the
circumference of the opening.

Florida
Boarding is pre-approved in the following zip code areas:
Miami:
33004 33009 33010 33012 33013 33014
33020 33023 33034 33054 33055 33056
33060 33069 33122 33125 33127 33128
33130 33131 33132 33136 33137 33138
33142 33147 33150 33157 33161 33167
33168 33169 33170 33177 33181 33190
33311 33315 33316 33401 33403 33404
33405 33407 33426 (east of 1-95) 33435 33441
33444 33460 33462 (east of 1-95)

Exterior surface and edges of all plywood should be painted with one coat white primer
and one cost white finish. Use of screws to secure panels to wood frame windows is
prohibited. See plywood-boarding diagram on page 25.

Caribbean
Exterior surface and edges of all plywood should be painted with one coat white primer
and one coat white finish. Use of screws to secure panels to wood frame windows is
prohibited. Additionally, boarding is pre-approved in the following zip code areas:
00923 00924 00929 00601 00602 00603
00703 00704 00705 00610 00612 00714
00616 00617 00794 00915 00956 00957
00959 00961 00622 00623 00725 00627
00729 00920 00921 00979 00982 00983
00985 00986 00987 00962 00736 00735
00935 00638 00739 00769 00782 00907
00783 00780 00926 00646 00647 00738
00650 00934 00652 00653 00784 00656
00965 00966 00967 00968 00969 00970
00971 00778 00659 00917 00660 00791
00662 00913 00664 00795 00777 00667
00669 00670 00771 00772 00911 00773
00674 00909 00606 00707 00680 00715

55
00676 00687 00718 00719 00720 00723
00624 00716 00717 00728 00730 00731
00734 00740 00741 00678 00677 00745
00925 00926 00927 00637 00688 00952
00751 00690 00683 00685 00757 00907
00909 00911 00912 00913 00953 00949
00976 00641 00692 00693 00901 00765
00766 00767 00698

EXCEPTION: There is no pre-approved boarding in ANY gated community within these

zip code areas.

PHILADELPHIA Homeownership Center

Connecticut
Boarding pre-approved in the following zip codes areas for the cities of:

Bridgeport:06601 06604 06605 06606 06607 06608 06610 06611

06612 06614 06615 06650 06673 06699
New Haven: 06501 06502 06503 06504 06505 06506 06507 06508
06509 06510 06511 06512 06513 06514 06515 06516
06517 06518 06519 06520 06521 06524 06525 06530
06531

Massachusetts
Boarding pre-approved for the following zip code areas:
Boston: 02108, 02109, 02110, 02118, 02119, 02120, 02121, 02122,
02124, 02125, 02126, 02127, 02128, 02130, 02131, 02136
Brocton: 02401, 02402
Lawrence: 01840, 01841, 01842, 01843, 01845
Lynn: 01902, 01903, 01904, 01905

New Jersey
Boarding is pre-approved for the following zip code areas for the cities of:

Asbury Park: 07712

East Orange: 07017 07018 07019
Elizabeth: 07201 07202 07206 07208
Irvington: 07111
Jersey City: 07302 07304 07305 07306 07307 09308 07309 07310
07311 07395 07399
Long Branch: 07740
Newark: 07101 07102 07103 07104 07105 07106 07107 07108

56
 07112 07114 07175 07182
07192 07193 07194 07195
New Brunswick: 08901 08902 08903
08933 08988 08989
Patterson: 07501 07502 07503 07504
07509 07510 07511 07512
07533 07538 07543 07544
Plainfield: 07060 07061 07062 07063
07184 07188 07189 07191
07197 07198 07199
09804 08905 08906 08922
07505 07506 07507 07508
07513 07514 07522 07524
07069

Boarding is pre-approved for the following zip code areas:

08016 08066 08096 08618 08608

08101 08102 08103 08104 08105
08232 08609 08610 08611 08611
08312 08302 (Bridgeton only) 08360 (Vineland only)
08401 08406 (Ventnor only) 08110 (Pennsauken only)
08600 08332 (Mellville only) 08650 (Trenton only)

New York, New York

Board all properties within the city limits of the five boroughs in New York City without
pre-approval with the exception of Dutchess, Putnam, and Rockland Counties.

Rhode Island
Boarding is pre-approved for the following zip code areas in the cities of:

Providence: 05901 02902 02903 02904 02905 02906 02907

02908 02909 02910 02911 02912 02918 02919
02940
Cranston: 02823 02905 02907 02910 02920 02921

Pennsylvania
Boarding is pre-approved for the following zip codes.

17509 17512 17516 17517 17518 17527

17532 17536 17547 17550 17560 17563
17565 18101 18102 18103 18115 18117
19013 19023 19320 19335 19380 19401
19464

SANTA ANA Homeownership Center

Long Beach, California
Properties should be secured with window screens and security doors only. Do not use
plywood boarding material to secure window openings. See diagrams and specifications
on pages 28-29.

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58
59
60
61
62
 ATTACHMENT 5 Debris Removal Service Requirements and Cost Schedule
A Mortgagee may expend up to the amount listed in this attachment for debris removal
without prior written approval from the M&M contractor. Costs such as labor hours,
dump fees, and transportation (e.g., fuel, mileage, truck rental) should not be claimed in
addition to the reimbursable amount as these costs are incorporated in the per unit
allowable cost for debris removal. Before and after photographs are required.

I. Exterior
Mortgagees should remove all exterior debris, including abandoned vehicles, in
accordance with applicable local laws. Items of personal property that are securely
affixed and in good condition, such as a swing set or dog-house/kennel should not be
removed if they add value to the property. However, if personal property is in disrepair
or determined to be a health and safety hazard, it should be removed.

Mortgagees must maintain, in the claim file, salvage yard and dump fee receipts that substantiate all
claimed debris removal. The documentation must include the date, address of the property(s) for
which the debris is being dumped, number of yards dumped, and the number and type of appliances
(e.g. refrigerators, stoves, dishwashers) being dumped or disposed. The receipt must indicate the
name of the dump to verify that the debris has been disposed of legally.

Before and after photographs are required to support all required debris removal.
Photographs should be dated and the property address indicated. If photographs are not
available as documentation of required debris removal, HUD will not reimburse the
Mortgagee for associated costs.

II. Interior (Including Attic, Basement, and Storage Spaces)

Mortgagees are not to remove interior debris except for:
• Debris that constitutes a health or safety hazard;
• Debris that has or is likely to result in issuance of a code violation, a fine
and/or lien;
• Debris required to be removed as part of an eviction by local law enforcement
or crews under the control and direction of local law enforcement where the Mortgagee
has no control over the timing of removal.

If the clean-out of a property’s interior is necessary, the clean-out should include removal
and proper disposal of debris including:
• Shabby or torn carpet;
• Dilapidated, unsafe flooring;
• Health and safety hazards (See Hazardous Waste Removal, below), including
dead animals; and Personal effects (e.g., furniture, clothing, dishes, utensils), unless
otherwise instructed by local law enforcement during an eviction.

Before and after photographs are required to document the existence of personal property
items and all required debris removal. Photographs should be dated and the property

63
 address indicated. If photographs are not available as documentation of required debris
removal, HUD will not reimburse the Mortgagee for associated costs.

III. Hazardous Waste Removal

Mortgagees are required to remove unhealthy or hazardous materials from the exterior
and interior of properties prior to conveyance and should adhere to local municipal health
and safety requirements with respect to proper disposal of said materials. For additional
clarification, the Environmental Protection Agency (EPA) website lists common
household items containing potentially hazardous ingredients that might be found in a
garage, basement, or other storage space (http://www.epa.gov/epaoswer/non-
hw/muncpl/hhw-list.htm). Further, as a matter of health and safety, refrigerators should
be unplugged and refrigerator doors should be removed and stored if required by
applicable state or local law or ordinance.

Materials considered unhealthy or hazardous that should be removed prior to conveyance

include but are not limited to:
• Decaying food or other organic matter,
• Dead animals and animal feces,
• Pest infestations (see below)
• Broken glass or other sharp objects,
• Large containers of liquids,
• Large quantities of paint or paint products,
• Paints or solvents in any amount stored in or near papers, fabrics or other
flammable materials.
• Highly flammable chemicals (e.g., solvents, paint thinners, gasoline, motor oil
and motor additives, etc.),

The following products, if found in quantities consistent with normal household use, are
not considered hazardous waste for purposes of debris removal under this section.
• Non-flammable materials including reasonable quantities of paper and fabrics
(unless stored near flammable chemicals),
• Common cleaning products and household chemicals such as insect repellent,
• Up to five gallons of paint and paint products,
• Lawn and garden products and fertilizers,
• Pool chemicals.

EPA guidelines allow paint cans to be disposed of with regular debris, once treated. Paint
is treated by brushing the paint onto cardboard or newspaper, allowing the empty can to
dry with the lid off, or by adding absorbent material such as kitty litter, shredded
newspaper, sand, or sawdust directly into the latex paint can. Dried paint may then be
thrown in the trash and removed from the property as regular debris.

The M&M contractor must approve any costs associated with disposal action(s) required
by a municipality.

64
 IV. Bug and/or Pest Infestation
If, on the initial inspection, the Mortgagee finds the property to be infested with pests
(e.g., roaches, water bugs, mice, rats) that constitute a health or safety hazard or prevent
clean-out or debris removal, the Mortgagee should have the property fumigated by a Pest
Control Service, licensed to conduct such business in the area where the property is
located. The maximum allowable amount for this service is provided in the cost schedule
of this attachment.

V. Personal Property and Debris Removal during Evictions

Some jurisdictions require a legal eviction to remove personal property from a vacant
house. Mortgagees should follow local code and laws and exercise good judgment when
distinguishing between personal property and debris. If Mortgagees have questions
regarding personal property and debris, they should consult local counsel. If a Mortgagee
is required by local law to remove trash and debris from the property as part of an
eviction and the Mortgagee has no control over the timing of removal, the costs for
removing the items are considered eviction expenses and are not subject to the debris
removal cost guidelines, the maximum securing fee or the overall allowable cost limit.
These costs are to be claimed as man-hours and should be deemed by the M&M
contractor to be reasonable and customary for services performed in the area.

A. Personnel
In most circumstances, no more than four people should be necessary to complete an
eviction for a townhouse or condominium and six people for a single family detached
dwelling. If local law provides that a specific number of people should be provided, or if
the law enforcement official conducting the eviction identifies a need for additional
people to be present at the time of the eviction, this information must be documented in
the claim review file. Similarly, if local or state law, requires that a service be performed
within a certain time frame or subject to specific removal or storage requirements, those
requirements must be fully documented in the claim review file and costs are not subject
to the allowable cost limit for the jurisdiction.

The removal of curbside debris following an eviction will be reimbursed as man-hours.

No more than four man-hours at $20 per man-hour, per person at the scheduled eviction
will be reimbursed for the removal and disposal of eviction debris. Dump fees and
storage fees (as appropriate for the jurisdiction) will be also be reimbursed.

If crews show up for canceled or re-scheduled evictions, the Mortgagee is only eligible to
claim a maximum of one man-hour at $20 of labor per person.

B. Photographic Evidence
Photographs are required to support all personal property/debris removed from a property
as part of an eviction. Eviction costs should be entered in item 305 of Part D of the claim
form.

65
 VI. Over-allowable Requests for Debris Removal Services
Mortgagees should obtain prior written approval from the M&M contractor for any debris
removal expense that exceeds the cost per cubic yard or the total allowable number of
yards indicated in the schedule. When requesting approval to exceed the debris removal
cost limit, the Mortgagee should obtain two independent competitive bids. If the
Mortgagee utilizes a field service company that firm, may provide one of the bids. The
Mortgagee should obtain a second independent and competitive bid and submit the bids
to the appropriate M&M contractor with an over-allowable request. Field service
companies or contractors may not submit second bids directly to the M&M contractor.
This violates the integrity of HUD’s requirement for an independent and competitive bid
process.

The bids should specify the types and location of the debris, the number of cubic yards,
and include photographic documentation. Any additional costs of non-general refuse
should be factored into the final bid and clearly indicated for M&M contractor review.
All second bids should be on the bidding company’s letterhead and should include the
bidder’s name, address, telephone number, and signature. Upon receipt of the bids, the
Mortgagee should date stamp them and attach them to a Request to Exceed Cost Limit
For Preservation and Protection. Additionally, the Mortgagee should identify all other
preservation and protection expenses to date so that the M&M contractor will know if
and by how much the Mortgagee will exceed the maximum allowable cost limit. Debris
removed per local code is also subject to the established cost limits on debris removal.
Mortgagees will not be reimbursed for the cost of obtaining bids.

Upon receipt of the required bids, the M&M contractor will, within five business days,
take one of the following actions:
•Notify the Mortgagee to accept one of the bids submitted;
•Reject both bids and provide the Mortgagee with examples of similar work that has been
recently performed at a more reasonable cost, or
•Notify the Mortgagee to convey the property without removing the debris.

66
 Debris Removal Service Schedule
Per Max 1 Max 2 Max 3 Max 4 Large
Vehicle Pest
State Cubic Unit 12 Units 15 Units 18 Units 21 Appliance Tires *
Removal Infest.
Yard cu yd. cu yd cu yd cu yd Removal
Alabama $45 $540 $675 $810 $945 $140 $180 $150 $15
Alaska $35 $420 $525 $630 $735 $95 $125 $75 $15
Arizona $35 $420 $525 $630 $735 $95 $215 $75 $15
Arkansas $35 $420 $525 $630 $735 $113 $215 $125 $15
California $40 $480 $600 $720 $840 $88 $120 $75 $15
Colorado $40 $480 $600 $720 $840 $100 $160 $125 $15
Connecticut $55 $660 $825 $990 $1155 $155 $210 $110 $15
Delaware $55 $660 $825 $990 $1155 $110 $215 $110 $15
District of Columbia $55 $660 $825 $990 $1155 $100 $215 $110 $15
Florida $45 $540 $675 $810 $945 $100 $180 $170 $15
Georgia $50 $600 $750 $900 $1,050 $140 $205 $113 $15
Guam $40 $480 $600 $720 $840 $88 $125 $10 $15
Hawaii $35 $420 $525 $630 $735 $88 $125 $10 $15
Idaho $40 $480 $600 $720 $840 $75 $165 $75 $15
Illinois $40 $480 $600 $720 $840 $125 $155 $140 $15
Indiana $60 $720 $900 $1,080 $1260 $55 $95 $140 $15
Iowa $35 $420 $525 $630 $735 $50 $115 $100 $15
Kansas $35 $420 $525 $630 $735 $40 $140 $100 $15
Kentucky $50 $600 $750 $900 $1050 $165 $215 $20 $15
Louisiana $50 $600 $750 $900 $1,050 $82 $170 $100 $15
Maine $50 $600 $750 $900 $1,050 $195 $210 $110 $15
Maryland $55 $660 $825 $990 $1,155 $195 $215 $110 $15
Massachusetts $50 $600 $750 $900 $1,050 $195 $210 $110 $15
Michigan $50 $600 $750 $900 $1,050 $135 $240 $50 $15
Minnesota $40 $480 $600 $720 $840 $75 $125 $150 $15
Mississippi $55 $660 $825 $990 $1,155 $140 $215 $45 $15
Missouri $35 $420 $525 $630 $735 $150 $140 $75 $15
Montana $50 $600 $750 $900 $1,050 $150 $160 $75 $15
Nebraska $35 $420 $525 $630 $735 $63 $115 $125 $15
Nevada $40 $480 $600 $720 $840 $75 $165 $75 $15
New Hampshire $50 $600 $750 $900 $1,050 $155 $210 $110 $15
New Jersey $50 $600 $750 $900 $1,050 $140 $210 $110 $15
New Mexico $40 $480 $600 $720 $840 $150 $160 $125 $15
New York $45 $540 $675 $810 $945 $105 $140 $110 $15
North Carolina $55 $660 $825 $990 $1,155 $130 $230 $35 $15
North Dakota $40 $480 $600 $720 $840 $75 $125 $125 $15
Ohio $40 $480 $600 $720 $840 $105 $130 $110 $15
Oklahoma $35 $420 $525 $630 $735 $100 $190 $40 $15
Oregon $40 $480 $600 $720 $840 $25 $125 $10 $15
Pennsylvania $50 $600 $750 $900 $1,050 $50 $210 $110 $15
Puerto Rico $50 $600 $750 $900 $1,050 $130 $190 $35 $15
Rhode Island $50 $600 $750 $900 $1,050 $195 $210 $110 $15
South Carolina $55 $660 $825 $990 $1,155 $30 $235 $75 $15
South Dakota $45 $540 $675 $810 $945 $32 $190 $125 $15
Tennessee $50 $600 $750 $900 $1,050 $135 $195 $20 $15
Texas $45 $540 $675 $810 $945 $75 $190 $125 $15
Utah $40 $480 $600 $720 $840 $90 $195 $100 $15
Vermont $50 $600 $750 $900 $1,050 $195 $215 $110 $15
Virginia $55 $660 $825 $990 $1,155 $70 $230 $110 $15
Virgin Islands $50 $600 $750 $900 $1,050 $130 $190 $35 $15
Washington $35 $420 $525 $630 $735 $40 $115 $51 $15
West Virginia $50 $600 $750 $900 $1,050 $125 $240 $60 $15
Wisconsin $40 $480 $600 $720 $840 $150 $115 $100 $15
Wyoming $45 $540 $675 $810 $945 $77 $190 $75 $15

67
 Reimbursement is per tire. If there are more than 6 tires, contact the M&M contractor
ATTACHMENT 6 Yard Maintenance and Snow Removal Requirements and
Cost Schedule

I. Grass Cuts
Lawn cutting (initial and subsequent cuts) includes mowing the lawn, weeding, edge
trimming, sweeping of all paved areas (sidewalks, driveways, patios, etc.), and removal
of all lawn clippings, related cuttings, and incidental debris (newspapers, flyers, bottles,
etc.). These services are included in the cost allowable for an initial cut and subsequent
cut (re-cut). The disposal of all clippings and incidental debris should be in compliance
with jurisdictional requirements. The costs allowable for trimming shrubs and snow
removal are listed separately in the accompanying schedule. Before and after photographs
are required for all cuts. All photographs should be dated.

Mortgagees should not order lawn maintenance if a homeowners’ association for such
properties as condominiums covers this service.

A. Frequency
One initial grass cut is allowed during each grass-growing season followed by subsequent
cuts periodically throughout the season. If a local variation requires that the grass be
maintained year round, only one initial cut may be charged. If there is one grass-growing
season in the geographical location of the property, one initial cut is allowed within a 12-
month period. If there are multiple growing seasons, an initial grass cut is permitted at
the beginning of each grass-growing season.

If conveyance occurs during the growing season, unless otherwise indicated in local
variations, a final grass cut should be completed within two weeks of conveyance.

Grass should typically be cut twice a month between April 1st and October 31st, however, more
frequent lawn cuts may be allowed in certain areas as indicated in the variances at the end of this
attachment. Grass should not be cut between November 1st and March 31st unless prior written
approval is obtained from the M&M Contractor or otherwise prescribed in the local variances. If
the grass grows to six inches in length during the off-season, the Mortgagee should request prior
approval to cut the grass.

B. Oversized Yards
For yards greater than 15,000 square feet, Mortgagees should submit an over-allowable
request. Requests to exceed cost limits for larger lots should be accompanied by lot
dimensions and the calculated square footage of the lot as well as photo documentation.
Mortgagees may request overallowable approval for an entire growing season. For each
over-allowable request, the Mortgagee should provide one bid for the cost of the initial
cut, one bid for each subsequent cut (all of equal cost) and the total number of subsequent
cuts required. Even if the Mortgagee is approved for an entire season, HUD will only
reimburse grass-cutting expenses actually incurred.

C. Specifications

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Grass should be cut to a maximum of two inches in length. Grass and weeds are to be cut to the edge
of the property line and to a maximum of two inches. Grass and weeds are to be trimmed around
foundations, bushes, trees, and planting beds. Grass and weeds should also be trimmed flush with
fences and other construction that would normally require trimming.

Shrubs are to be trimmed and cuttings removed once in a growing season, between April
1st and October 31st. An over-allowable should be submitted for any subsequent
trimming of shrubs during the same growing season, with appropriate before and after
photographs.

II. Snow Removal

The Mortgagee should maintain a safe and accessible property throughout the winter season. Snow should
be removed from the entry, walkway, porch and driveway following a minimum three-inch accumulation.
Mortgagees must comply with local codes and ordinances governing the removal of snow and ice. Before
and after photographs are required for all snow and ice removal.

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 Yard Maintenance Cost Schedule

Initial Initial cut Re-cut

Re-cut up
cut up to 10,001 sq 10,001 sq Snow Trim
State to 10,000
10,000 ft to 15,000 ft to 15,000 Removal Shrubs
sq ft
sq ft sq ft sq ft
Alabama $70 $90 $65 $85 $0 $30
Alaska $100 $120 $95 $115 $55 $40
Arizona $75 $95 $70 $90 $50 $40
Arkansas $70 $90 $65 $60 $45 $40
California $100 $120 $95 $115 $55 $45
Colorado $85 $105 $80 $100 $45 $40
Connecticut $100 $120 $95 $115 $55 $45
Delaware $95 $125 $90 $120 $45 $35
District of Columbia $95 $115 $90 $110 $55 $45
Florida $85 $105 $80 $100 $0 $30
Georgia $85 $105 $80 $100 $0 $30
Guam $110 $130 $105 $125 $0 $45
Hawaii $110 $130 $105 $125 $0 $45
Idaho $100 $120 $95 $115 $55 $45
Illinois $85 $105 $80 $100 $45 $30
Indiana $85 $105 $80 $100 $45 $30
Iowa $85 $105 $80 $100 $45 $40
Kansas $85 $105 $80 $100 $45 $40
Kentucky $85 $105 $80 $100 $45 $30
Louisiana $85 $105 $80 $100 $45 $40
Maine $100 $120 $95 $115 $55 $45
Maryland $100 $120 $95 $115 $55 $45
Massachusetts $100 $120 $95 $115 $55 $45
Michigan $85 $105 $80 $100 $45 $35
Minnesota $85 $105 $80 $100 $45 $40
Mississippi $85 $105 $80 $100 $0 $30
Missouri $85 $105 $80 $100 $45 $40
Montana $85 $105 $80 $100 $45 $40
Nebraska $85 $105 $80 $100 $45 $40
Nevada $90 $110 $85 $105 $50 $40
New Hampshire $100 $120 $95 $115 $55 $45
New Jersey $100 $120 $95 $115 $55 $45
New Mexico $85 $105 $80 $100 $45 $40
New York $100 $120 $95 $115 $55 $45
North Carolina $85 $105 $80 $100 $45 $30
North Dakota $85 $105 $80 $100 $45 $40
Ohio $85 $105 $80 $100 $45 $35
Oklahoma $85 $105 $80 $100 $45 $40
Oregon $100 $120 $95 $115 $55 $45
Pennsylvania $95 $115 $90 $110 $45 $35
Puerto Rico $110 $130 $105 $125 $0 $30
Rhode Island $100 $120 $95 $115 $55 $45
South Carolina $85 $105 $80 $100 $0 $30
South Dakota $85 $105 $80 $100 $45 $40
Tennessee $85 $105 $80 $100 $45 $30
Texas $85 $105 $80 $100 $45 $40
Utah $85 $105 $80 $100 $45 $40
Vermont $100 $120 $95 $115 $55 $45
Virginia $95 $115 $90 $110 $55 $45
Virgin Islands $85 $105 $80 $100 $0 $30
Washington $100 $120 $95 $115 $55 $45
West Virginia $95 $115 $90 $110 $55 $45
Wisconsin $85 $105 $80 $100 $45 $40
Wyoming $85 $105 $80 $100 $45 $40

If property yard is over 15,000 square feet, contact the M&M contractor.

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 Local Variations from General Requirements

SANTA ANA Homeownership Center

Arizona/ California/ Nevada

Grass should be cut year-round. Properties with desert landscaping require only
once a month weed removal and are reimbursed as a re-cut.

Hawaii/Pacific Islands
Grass should be cut year round.

ATLANTA Homeownership Center

Florida
Grass should be cut year round.

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 ATTACHMENT 7 Winterization Requirements and Cost Schedule
This section provides instruction for maintenance of utilities and winterization of
properties to protect against freeze damage. It also addresses maintenance of wells and
properties with sump pumps.

I. Utilities
Unless identified in the variations section of this attachment, utilities are to be turned off.
In states where heat is to remain on, the temperature should be maintained at 55 degrees
Fahrenheit unless otherwise noted in the local variations.

A. Condominiums and Attached Dwellings

At condominiums and attached dwellings in Planned Unit Developments (PUDs), water
services and utilities should remain on if the systems are shared with other units. M&M
Contractors should be contacted for directions on maintaining water services at properties
where a community water service is involved and for electrical services at condominiums
or townhouses, duplexes, attached dwellings in PUDs, where such services should be left
on due to homeowners’ association or party wall requirements.

B. Equipment Damage
If a major repair or replacement is needed to make the heating system operational, the
Mortgagee should contact the M&M Contractor for instructions. The Mortgagee is
responsible for damages to plumbing and heating systems caused by untimely and/or
improper maintenance.

C. Sump Pumps
Where there is an existing sump pump used to keep basements or crawl space dry, the
Mortgagee should leave the electricity on to assure the property is undamaged by
flooding, regardless of whether the property is located in a state where utilities are
required to be off. The Mortgagee should check to make sure the sump pump is operating.
Mortgagees should request prior written approval from the M&M contractor if the cost of
installing a sump pump exceeds $250.

D. Utility Accounts
Utility accounts including electricity, gas, home heating oil and water, should be in the
Mortgagee's name until conveyance of the property to HUD. The Mortgagee should pay
the bill and may claim reimbursement for utility costs covering the period from the date of
vacancy until the end of the billing cycle that includes the date of conveyance. Payment
of a utility bill that includes charges for a portion of a billing cycle that is post
conveyance, is the exception to HUD’s policy on non-reimbursement of expenses after the
conveyance date. It is the Mortgagee's responsibility to notify the utility company that
ownership of the security property has been transferred to HUD (to the attention of the
M&M contractor), upon conveyance. A copy of the notice should be maintained in the
claim review file.

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 In states where utilities should remain on, if there is any reason to believe that a
Mortgagor may abandon a property, the Mortgagee should contact the utility company to
request that the Mortgagee be notified of non-payment of utilities so that utilities can be
transferred to the Mortgagee’s name and the heat remain on if the Mortgagor vacates.

E. Propane and Oil Systems

If the property has a propane or oil heating system, put on "KEEP FULL" contract with a
local supplier; in those jurisdictions where the heat should remain “ON”.

II. Water
A. Domestic Water
If the water supply source is a public system, the utility should be contacted to turn off the
water supply at the curb, unless otherwise indicated in the local variations. The Mortgagee
should not cut water lines or remove water meters. (A non-reimbursable charge may be
imposed by the water utility for unauthorized water meter removal). The water
department or provider should be notified when water is turned off so that a final meter
reading can be done. The Mortgagee should ensure that this is completed. Where a water
heater has to be installed, the Department will reimburse up to $350 for an electric water
heater or up to $420 for a gas water heater, which includes the cost of installation.

B. Wells
If the water supply is a private well, the Mortgagee should turn off the well at the breaker
panel and tape off the breaker, disconnect the water supply line between the property and
pressure tank and install a hose bib on the pressure tank side of the breaker. The hose bib
should then be tagged “For Water Testing". All pressure tanks should be drained. If
pump is surface mounted, drain pump housing, - if submersible, then disconnect the check
valve and drain all pump, suction, and discharge pipes. All fixtures should be winterized.

C. Reduced Pressure Zone Device (RPZ or RPZD)

A reduced pressure zone device (RPZ) is a type of backflow prevention device used to
protect domestic water supplies from contamination. Mortgagees should contact the local
health departments and/or state and local agencies with regard to any jurisdictional
requirements for the installation and/or use of the RPZ device on all wet heat systems.
Mortgagees should obtain two independent competitive bids and request prior written
approval from the M&M contractor if the cost of installation of an RPZ valve exceeds
$70.

III. Winterization
In jurisdictions where winterization is required, properties are to be winterized between
October 1st and March 31st. For exceptions to these winterization time periods, see the
Local Variation from General Requirements section on page 43. Properties should only
be winterized once. However, a property should be re-winterized if the initial
winterization is violated (no longer effective) and the Mortgagee obtains prior approval
from the M&M Contractor.

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 The winterization process is to include cleaning toilets and a thorough and complete
draining of all plumbing and heating systems unless otherwise specified by any local
variation. Use of air pressure to clear the system or, in some cases, adding antifreeze to
the systems are both acceptable provided that the effect prevents freeze-ups. All
winterization should be performed in accordance with state and local codes, ordinances
and regulations. Before and after photographs are required along with any other
supporting documentation to support a claim for re-imbursement.

A. Dry Heat Systems

The hot water heater and all domestic water supply and distribution piping should be
thoroughly drained. All faucets and valves should REMAIN OPEN during the process,
and then closed after draining is completed. Adequate amounts of antifreeze are to be
placed in all fixture traps, including toilet tanks and bowls.

B. Wet Heat, Radiant, Hydronic or Hot Water Baseboard Systems

The winterization requirements outlined above apply. In addition, the house boiler system
should be thoroughly drained. All radiator vents are to be opened in the process. Bleeder
pins should not be removed from the radiators. Any radiant heat piping should be drained
and blown dry with the use of an air compressor and an adequate amount of antifreeze is
to be put in the radiant piping.

C. Steam Heat Systems

The winterization requirements outlined above for Dry Heat Systems apply. Note: A
steam heat system will have radiators with valves at the bottom of the radiator; a careful
determination as to whether the system is hot water or steam is important to ensure proper
action is taken. The Mortgagee should determine if the system is operable and if there are
any leaks. If any problems with the steam heat system exist, this information should be
reported to the M&M Contractor. Additionally, the Mortgagee should thoroughly drain
the property’s boiler system. All radiator vents are to be opened in the process and
bleeder pins should not be removed from the radiators, before shutting down the heating
system. Pressurize the system with an air compressor to 35 pounds and inspect for
leakage. The expectation for a properly prepared system is that it will hold air pressure
with no leakage for a minimum of one-half hour.

IV. Repair Bids

The Mortgagee may spend up to $250.00, for required repairs or installation of any new
equipment required to maintain utilities or properly winterize a property including but not
limited to, water wells, water meters, heating equipment, etc. Where such repairs will
exceed $250, the mortgagee shall obtain two independent competitive bids and submit the
bids to the appropriate M&M contractor for approval. Please advise the M&M where the
meter may only be removed by the utility.

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 Winterization Service Cost Schedule
Dry Heat Steam Heat Wet/Radiant
Dry Heat 1 Steam Wet/Radiant
State Additional Additional Heat Additional
Unit Heat 1 Unit Heat 1 Unit
Units Units Units
Alabama $90 $50 $140 $90 $460 $230
Alaska $130 $50 $190 $90 $475 $465
Arizona $80 $50 $120 $90 $460 $230
Arkansas $75 $50 $130 $90 $460 $230
California $75 $50 $130 $90 $460 $230
Colorado $120 $50 $160 $90 $460 $230
Connecticut $130 $50 $190 $90 $460 $230
Delaware $90 $50 $145 $90 $460 $230
District of Columbia $90 $50 $145 $90 $460 $230
Florida
(Jacksonville) $100 $50 $155 $90 $460 $230
Georgia $100 $50 $150 $90 $460 $230
Hawaii N/A N/A N/A N/A N/A N/A
Idaho $105 $50 $220 $90 $460 $230
Illinois $75 $50 $145 $90 $460 $230
Indiana $75 $50 $130 $90 $460 $230
Iowa $75 $50 $370 $90 $460 $230
Kansas $75 $50 $145 $90 $460 $230
Kentucky $85 $50 $155 $90 $460 $230
Louisiana $75 $50 $130 $90 $460 $230
Maine $130 $50 $190 $90 $460 $230
Maryland $90 $50 $145 $90 $460 $230
Massachusetts $130 $50 $190 $90 $460 $230
Michigan $75 $50 $155 $90 $460 $230
Minnesota $120 $50 $245 $90 $460 $230
Mississippi $75 $50 $130 $90 $460 $230
Missouri $75 $50 $145 $90 $460 $230
Montana $90 $50 $230 $90 $460 $230
Nebraska $75 $50 $130 $90 $460 $230
Nevada $105 $50 $145 $90 $460 $230
New Hampshire $130 $50 $190 $90 $460 $230
New Jersey $100 $50 $155 $90 $460 $230
New Mexico $120 $50 $160 $90 $460 $230
New York $100 $50 $130 $90 $460 $230
North Carolina $75 $50 $155 $90 $460 $230
North Dakota $120 $50 $245 $90 $460 $230
Ohio $75 $50 $115 $90 $460 $230
Oklahoma $75 $50 $130 $90 $460 $230
Oregon $75 $50 $130 $90 $460 $230
Pennsylvania $75 $50 $155 $90 $460 $230
Rhode Island $130 $50 $190 $90 $460 $230
South Carolina $75 $50 $155 $90 $460 $230
South Dakota $130 $50 $190 $90 $460 $230
Tennessee $90 $50 $150 $90 $460 $230
Texas $130 $50 $130 $90 $460 $230
Utah $135 $50 $140 $90 $460 $230
Vermont $135 $50 $130 $90 $460 $230
Virginia $75 $50 $145 $90 $460 $230
Washington $75 $50 $130 $90 $460 $230
West Virginia $75 $50 $130 $90 $460 $230
Wisconsin $75 $50 $130 $90 $460 $230
Wyoming $130 $50 $190 $90 $460 $230

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 Local Variations from General Requirements

ATLANTA Homeownership Center

Illinois/Indiana
Winterize year round, regardless of the month the property is secured. However, heat
will remain in shut down mode. Utilities are to remain off unless required to operate a
sump pump.

Caribbean
Do not winterize.

Florida
The water supply should be shut off at the curb. Notify utility companies to cancel all
services. Do not drain the water heater or water lines. Do not winterize.

Jacksonville Florida ONLY

Winterize from September 1 through April 30 from Jacksonville north to the Georgia
line. However, heat will remain in shut down mode. Utilities are to remain off unless
required to operate a sump pump.

DENVER Homeownership Center

Kansas, Missouri, Oklahoma

Winterization is required from September 1 through April 30. However, heat system will
remain in shut down mode. Utilities are to remain off unless required to operate a sump
pump.

Minnesota, Montana, Iowa, North Dakota, Wyoming

Winterization is required from September 1 through April 30. Utilities and heat are to
remain on.

Wisconsin
Winterization is required from September 1 through April 30. Turn water off at meter in
house ONLY. Heating system will remain in shut down mode. Utilities are to remain off
unless required to operate a sump pump.

SANTA ANA Homeownership Center

Turn water off at the street after winterization in all Santa Ana M&M contract areas,
except Alaska.

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Alaska
All properties should be winterized year round. Heat should be left on with the thermostat
set at 55 degrees Fahrenheit. Properties should be conveyed with water, gas, and utilities
ON. Propane and fuel oil delivery services should remain on automatic fill. Utilities
should remain in the servicing Mortgagee's name until conveyance. The servicing
Mortgagee is instructed and authorized to switch utilities into HUD's name effective on
the date of conveyance.

Water service may be turned off at the street (key box) only if the property has a forced
air or electric heating system and the domestic water system has been properly
winterized.

Arizona/California
Winterize properties above 2,000 feet only. However, heat system will remain in shut
down mode. Utilities are to remain off unless required to operate a sump pump.

Hawaii/Pacific Islands
Do not winterize.

Nevada
No winterization except for Pahrump zip code 89041 and Mt. Charleston zip code 89124.
All other winterization is completed on a case-by-case basis. However, heat system will
remain in shut down mode. Utilities are to remain off unless required to operate a sump
pump.

Reno, Nevada
Winterize from September 15 through April 15. However, heat system will remain in
shut down mode. Utilities are to remain off unless required to operate a sump pump.

Oregon
Winterize from November 1 through March 31 only. However, heat system will remain
in shut down mode. Utilities are to remain off unless required to operate a sump pump.

Washington
Winterize from September 15 through April 15. However, heat system will remain in
shut down mode. Utilities are to remain off unless required to operate a sump pump.
ATTACHMENT 8 Request to Exceed Cost Limits for Preservation and Protection
If the cost to perform required preservation and protection exceeds any individual cost
limits or the overall cap shown in this Mortgagee Letter, the Mortgagee should request
permission to exceed the maximum allowable expenses in writing using, Form HUD-
50002, Requests to Exceed Cost Limit For Preservation and Protection. The Mortgagee
should include documentation to substantiate the over-allowable expense with the
request, including a line item bid for the individual work items to be performed.

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Mortgagees may mail or fax their requests to the M&M Contractor’s office and by pre-
arrangement with the M&M, may submit the requests electronically. Receipt of faxed
requests should be confirmed by telephone.

The M&M Contractor will review and approve or disapprove over-allowable requests
from Mortgagees within five business days of receipt. The M&M Contractor will
evaluate all requests to increase line items on a case-by-case basis. With the exception of
requests involving debris removal and repairs necessary for winterizations where two
independent bids are mandatory, there is no requirement for the Mortgagee to submit
multiple bids for other expense types.

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