To sub or not to sub? Liability issues. - REO Property Preservation Forum
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post #1 of 22 (permalink) Old 10-22-2015, 05:51 PM Thread Starter
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To sub or not to sub? Liability issues.

I know a lot of people sub jobs out and make a small profit. I've stayed away from this practice due to worries about liability. If the bank doesn't pay for a job, you can't pay the sub, and then you get sued. Is there anyone out there than can offer advice on whether subbing is dangerous or profitable?
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post #2 of 22 (permalink) Old 10-22-2015, 06:21 PM
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Filling in all the blanks dotting i's crossing t's

is a challenge when you are actually on the job. Your ship better be tight as a drum is all I will say. You better also be prepared to take it on the chin for a while.
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post #3 of 22 (permalink) Old 10-22-2015, 06:56 PM
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Originally Posted by Preservationpete View Post
. . .Is there anyone out there than can offer advice on whether subbing is dangerous or profitable?
Done correctly it is both.

Same as if you sent a hired employee, the quality of work won't be as high as it would be if you were doing the work yourself so there will most likely be some QC issues, nor will the work get completed as effeciently or at the very least more hands will be in the pie so the profit levels will be lower. Having said that, I can't be in 2, 3 or more places at once, so subbing can definately be profitable too, assuming you've found the right subs - which is not an easy task by any means.

As far as waiting to get paid to pay, WRONG! If you do not have the money in your pocket to pay for the work you order a sub contractor to complete, you cannot afford to take on the work - PERIOD!
Will you get burnt? Maybe.
Will you learn fast? Yes.
Will you make money? Probably, If not, don't take on any more extra work.

Iíve already told you more than I know.
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post #4 of 22 (permalink) Old 10-22-2015, 07:30 PM
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My few subs always get paid regardless if I do or not. Not their fault I gave them work from a bad client.
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post #5 of 22 (permalink) Old 10-22-2015, 07:41 PM
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post #6 of 22 (permalink) Old 10-22-2015, 08:40 PM
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I sub very little but pay on completion.

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My few subs always get paid regardless if I do or not. Not their fault I gave them work from a bad client.
I sub trash outs and sales cleans, that's it.
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post #7 of 22 (permalink) Old 10-22-2015, 09:33 PM
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there is a gray area in the sub contracting pay scale. Problem is you need to qc the work to make sure it is done correctly. I wouldn't pay a sub a dime until I personally checked the pictures, reports, and the job site to make sure it was done correctly. Then you can lay out the money to pay the sub. Problem really is that if the work isn't done correctly or if the pics don't show it done correctly you will be liable. So to pay the contractors you hire before you get paid is the correct way to do things, but you must have a very good qc process to limit your liability of not getting paid
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post #8 of 22 (permalink) Old 10-22-2015, 09:35 PM
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My few subs always get paid regardless if I do or not. Not their fault I gave them work from a bad client.
The expert in anything was once a beginner
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post #9 of 22 (permalink) Old 10-23-2015, 12:28 AM Thread Starter
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Thanks for all the replies, some great knowledge to be gained here. So basically finance the job, sometimes you win, sometimes you lose, and have a solid QC system in place.
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post #10 of 22 (permalink) Old 10-23-2015, 06:40 AM
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Most beginners never become experts

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The expert in anything was once a beginner
at anything.
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