What's A Bpo In Real Estate
Before I start, I want to be clear with the term BPO. BPO stands for Broker Price Opinion. This process is similar to appraisal, but it is not so comprehensive. It is performed by a real estate broker. The outcome is only an opinion about the fair market value of the property. The lenders order the BPO and they cover the cost. It is a determining factor in the acceptance of the short sale offer.
Usually the lender orders up to 3 BPOs for the same property, because often the suggested opinions are controversial. The BPO is the thing that can make or break the deal. Prepare for it and know what you want. Let me assume, that you are interested in this short sale to work. Here are the steps.
1. Tell the bank that you are the contact person for the inspection
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A new income opportunity has appeared on the horizon recently for down-and-out real estate agents who are in desperate need of income and this has led to one of the biggest scams in the real estate industry today. They are called BPO's and are an "opinion" by the Realtor of what the value of the home is. It is nowhere close to a real appraisal which is done by a professional real estate appraiser. These Realtors are obviously not making money selling real estate and are often some of the most inexperienced individuals in their profession trying to make an extra buck or two.
2. When the real estate broker contacts you to schedule the appointment, give him a general idea about your case. Explain the hardship and plead your case. Make them feel for you.
3. Keep in mind that as a real estate agent he is programmed to give the highest value, not the lowest.
4. At the day of the appointment prepare the house for the inspection. This is the only day when you do not have to clean your house. The rule is the worse the better. What's A Bpo In Real Estate
5. When you meet the real estate broker show him the short sale package. Discuss the contract and the purchase price. This way they will know what you need the appraisal to be.
6. Point out every single item in the house that needs repair. Real estate agents tend to think like end users. They will be inclined to give lower value of the property if they see how much work needs to be done.
7. Make sure you ask for the broker's business card. Ask him how long it would take the paperwork to be submitted. Usually, it takes a week or two.
8. Call the real estate broker. After a minute or two discussing the weather ask about the result of the BPO. They are not at liberty to give you this information, but 90% of the time of them do. When you know, you will be able to predict the outcome.
9. Do you have an FHA or VA mortgage? In this case an approved FHA or VA appraiser performs the appraisal. It is absolutely possible to short sale those loans. Research the information you need. If you look for something you will find it. Again, the golden key is ASK. This way you stay on top of the events and continue learning. What's A Bpo In Real Estate
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