Property Preservation Contract Template

If you maintain vacant, foreclosed, or bank-owned properties, the contract you sign with a national field service company or mortgage servicer determines whether the work is profitable — or a steady stream of unpaid orders and chargebacks. Property preservation is a high-volume, low-margin business where the paperwork matters as much as the labor, and a vague agreement is where contractors lose money.

This guide explains what a property preservation contract is, the clauses every field service contractor should insist on, how to handle pricing and allowables, and the mistakes that turn a busy month into an unpaid one.

What is a property preservation contract?

A property preservation contract is a service agreement that governs the maintenance and protection of vacant or distressed residential properties — typically homes in foreclosure, in REO (real estate owned) status, or being managed before resale. The work keeps the property secure, insurable, and in marketable condition.

The contract usually sits between two parties:

• A property preservation contractor (often a small crew or sole operator) who performs the field work, and
• A national field service company or mortgage servicer that holds the contract with the lender and assigns work orders.

The contractor rarely deals with the homeowner or even the lender directly. Instead, they receive work orders through an online portal, complete them within a deadline, document everything with photos, and get paid per order from a fixed price list. Because the relationship runs on volume and standardized pricing, the contract is where you lock in the terms that protect your margin.

What property preservation work covers

The scope of work clause should list the specific tasks the contractor is authorized — and expected — to perform. Common categories include:

• Securing the property — re-keying locks, installing lockboxes, boarding broken windows and doors
• Winterization — draining plumbing and HVAC systems in cold climates to prevent freeze damage
• Debris and personal property removal — clearing trash-outs and hauling away abandoned belongings
• Lawn maintenance and grass cuts — recurring cuts during the growing season to avoid code violations
• Snow removal — clearing walkways and driveways where required by local ordinance
• Initial and recurring inspections — confirming occupancy status and documenting condition
• Repairs and damage mitigation — roof tarping, mold treatment, and other bid-approved work

The more specific this list, the fewer disputes later. Vague language like "general property maintenance" invites a client to push tasks onto you that were never priced.

Key clauses every property preservation contract needs

1. Scope of work and the order system

Define how work is assigned. Most agreements run on work orders delivered through the client's portal, each with a task, a property address, a deadline, and an allowable amount. State that the contractor is only obligated to perform work that has been issued as a formal order — not verbal requests or "while you're there" additions.

2. Pricing and the price list

Property preservation is paid per completed order, not hourly. The contract should reference an attached or published price list that sets a fixed amount for each task (a grass cut, a lock change, a cubic yard of debris). Confirm:

• The price list is incorporated into the agreement by reference
• Prices cannot be changed unilaterally mid-term without notice
• How custom or non-listed work is priced (usually by approved bid)

3. Allowables and bid approval

Allowables are the heart of property preservation economics. An allowable is the dollar amount a servicer pre-authorizes for a task without a separate bid — say, $500 for debris removal. Work under the allowable can proceed immediately; work over it requires a written bid that the client must approve before you start.

Spell out the bid-approval process precisely. The single most expensive mistake in this industry is completing over-allowable work on a verbal "go ahead" and then having the bid denied. If it isn't approved in writing, you don't get paid — so the contract should require written approval and state that the contractor will not perform over-allowable work without it.

4. Photo documentation and completion standards

No photos, no payment. Clients require before, during, and after photos uploaded to their system as proof of completion, and they routinely reject orders for missing or low-quality images. The contract should define:

• Exactly what photo documentation is required for each task type
• The deadline for uploading after work is completed
• When an order is considered "complete" and eligible for payment

5. Payment terms and chargebacks

Define the payment timeline — commonly net 30 to net 60 from order approval — and, critically, how chargebacks work. A chargeback occurs when a client claws back payment for work later deemed deficient. Insist on:

• Written notice and a reason for any chargeback
• A reasonable window to cure or re-document the work
• A cap or dispute process so chargebacks can't be applied arbitrarily

6. Insurance and indemnification

You will be required to carry general liability insurance (often $1 million per occurrence) and sometimes a separate errors and omissions policy. The agreement will also include an indemnification clause. Read the direction carefully: you should indemnify the client for damage caused by your negligence — not for pre-existing conditions or hazards you couldn't have known about. A balanced indemnification agreement protects both sides; a one-sided one makes you the insurer for everything that goes wrong on a property you visit once.

7. Independent contractor status

Property preservation contractors are almost always 1099 independent contractors, not employees. The contract should say so plainly. Because the client assigns orders and sets standards, misclassification claims are a real risk in this industry — review our guide on hiring 1099 contractors and IRS classification to understand the factors that keep the relationship properly classified.

8. Subcontracting and crew responsibility

Many preservation contractors subcontract grass cuts, debris hauls, or specialty repairs to other crews while keeping the client relationship in their own name. The contract should state whether subcontracting is permitted and, if so, that you remain fully responsible to the client for the subcontractor's work and conduct. Without this clarity, a damaged property or a missed deadline caused by a sub can become a dispute over who actually owes the client.

9. Termination and open orders

Either party will eventually want an exit. Define the notice period for termination (commonly 30 days), whether either side can terminate for convenience or only for cause, and — most importantly — how open work orders are handled on the way out. You should be paid for any completed and properly documented orders even after notice is given, and the contract should say so explicitly rather than leaving final invoices to the client's discretion.

Direct servicer contracts vs. national field service companies

Where your contract sits in the chain changes the economics. Understanding the difference helps you read any agreement that lands in front of you.

National field service companies sit between the mortgage servicer and the boots on the ground. They hold the master contract with the lender, distribute work to a network of local contractors, and take a margin on every order. For a new contractor, this is the usual entry point: steady volume, a ready-made portal, and no need to win lender relationships yourself. The trade-off is thinner per-order pricing and less leverage to negotiate terms — the price list and allowables are largely set, and you take them or leave them.

Direct servicer or asset manager contracts cut out the middle layer. Pricing is better and you deal with the decision-maker, but the bar is higher: larger insurance requirements, stricter compliance and background-check standards, the capacity to cover a wider geography, and often a track record the servicer can verify. Most contractors start with field service companies and move toward direct work as they build volume and reputation.

Whichever tier you're in, the clauses that protect you are the same — scope, price list, allowables, documentation, payment timing, and insurance. The difference is how much room you have to negotiate them. With a field service company, your leverage is mostly in walking away from a bad price list; with a direct contract, expect to negotiate the document itself.

What to negotiate before you sign

Even when a price list is fixed, several terms are usually open:

• Payment timing. Push net 60 toward net 30, or ask for a faster track on high-volume order types.
• Chargeback limits. Negotiate notice, a cure window, and a cap so a single rejected order can't snowball.
• Allowable thresholds. Higher allowables mean fewer bids to wait on and faster completions — worth asking for once you've proven reliable.
• Geography and volume. Clarify the territory you're committing to so you aren't penalized for declining far-flung orders.
• Indemnity scope. Narrow it to your own negligence and resist language that makes you liable for pre-existing property conditions.

How to write a property preservation contract: step by step

1. Identify the parties. Name the contractor (and entity, if you operate through an LLC) and the field service company or servicer, with full legal names and addresses.
2. Attach the scope and price list. Incorporate the task list and the per-order price list as exhibits so there's no ambiguity about what's covered and what it pays.
3. Define the order workflow. State how orders are issued, the standard turnaround time, and that only issued orders create an obligation to perform.
4. Set allowables and the bid process. Document the allowable amounts and require written approval for any over-allowable work before it begins.
5. Specify documentation standards. List the photo and reporting requirements and the upload deadline that make an order payable.
6. Lay out payment and chargeback terms. State the net payment window, the dispute process, and any chargeback cap.
7. Address insurance, indemnity, and 1099 status. Set coverage minimums, balance the indemnification, and confirm the independent contractor relationship.
8. Cover subcontracting. State whether you may subcontract and confirm you remain responsible to the client for any crew you bring on.
9. Add termination and notice clauses. Define how either party can end the agreement, the notice period, and how open orders are paid out on termination.

Common mistakes to avoid

• Performing over-allowable work without written approval. This is the number-one cause of unpaid orders. No written bid approval, no payment — every time.
• Accepting an open-ended scope. "General maintenance" lets a client load tasks onto you that were never priced. Tie every obligation to the order system and price list.
• Ignoring the chargeback clause. Unlimited, no-notice chargebacks can wipe out a month of revenue. Negotiate notice, a cure period, and a cap.
• Under-insuring. Working without the required coverage isn't just a breach — one fire or flood claim on a vacant property can end your business. Match the policy to the contract's requirements before you sign.
• Treating the relationship as employment. Letting the client dictate your schedule, crew, and methods undermines your 1099 status and your independence. Keep control over how the work gets done.
• Skimping on photo documentation. Missing photos are the easiest reason for a client to reject an order. Build a documentation routine and follow it on every job.

Related contracts and clauses

Property preservation overlaps with several other service agreements you may need as your operation grows:

• A cleaning service contract if you offer trash-out and turn-over cleaning beyond basic debris removal.
• A landscaping contract for recurring lawn maintenance on a portfolio of properties.
• A snow plowing contract for winter clearing where local code requires it.
• A hold harmless agreement to allocate liability when you subcontract part of a job to another crew.

Generate Your Property Preservation Contract with Contractable

A property preservation business runs on volume, and you can't review a custom contract for every client relationship by hand. Contractable generates a clear, professional property preservation agreement in minutes — with the scope, pricing, allowable, insurance, indemnity, and 1099 clauses that protect your margin built in. Describe your work and your terms, and get a ready-to-sign contract you can adapt for every field service company you work with.