Whether you are completing a BPO for an REO listing you are taking or doing one for a BPO company for a fee, this article will provide the basics of what goes into completing a Broker’s Price Opinion.
Completing A BPO is really set up into 9 steps
1 – BPO Site Inspection
There are two types of site inspections in order to complete a BPO.
The first is Interior BPO. This is essentially getting the details from the interior and exterior of the property including condition details as well as specific pictures. Banks will hire real estate agents for an interior Broker Price Opinion for Short Sales and deed in lieu of foreclosure.
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The second is an Exterior BPO. This is just getting exterior pictures as there is usually someone living there. Many times lenders call on real estate agents for an exterior BPO in order to get an idea of condition / value once someone stops paying their mortgage.
Now that the BPO site inspection is completed, you are now back at your office to complete the rest of the actual BPO report & submission.
2 – BPO General Market Conditions
This portion in completing the Brokers Price Opinion is going to cover but not limited to overall market conditions, employment for the area, supply of homes and overall condition of neighboring homes.
3 – Subject Property Details / Status For Completing the BPO
This section of the BPO is just to cover the details of the actual subject property such as condition of the property, sq footage, beds / baths and overall all specs of the property.
4 – Sold Comps For The Broker Price Opinion
Most BPO companies and banks will require to use at lease 3 sold comps in order to complete the Broker Price Opinion.
It is extremely important that you use very good comparables in your analysis as you stand a chance at getting the BPO kicked back for revision which will waste your time.
5 – Active Comps For The BPO
Same as above for sold comps, you must use relative competitive comparables for the subject property in order to complete your broker price opinion.
6 – Valuation
This is where you will usuauyll give a 3 different values for the BPO.
- AS IS condition
- Repaired / Fixed Up
- Quick Sale
7 – Upload Pictures For The BPO
Not only will you need to upload pictures of the subject property but you will also have to upload pictures from MLS of the comparables you used in your BPO.
Word of caution! Be sure to pay close attention to the BPO companies instructions on pictures of the subject property. If you miss one required pic you will have to go back out to the property to retrieve it. IE – A picture of the address on the side of the house or mail box.
8 – Submission Of The Broker Price Opinion
Here you will do a final review and submit your BPO off. Be sure you do a thorough review so it doesn’t get kicked back.
9 – Review Of The BPO
Now during the review process the bank or BPO company will do their own desktop analysis.
If they feel some of the comparables you used where too far out or not adequate, they will kick it back. So it’s important you are using good comps.
I know. BPO submissions can be very tedious. However, they can add up to decent money. If you haven’t checked out my other video on how to make a $100 a day doing BPO’s, you can check it out here.