The fastest and easiest way to get BPO assignments and start making money right away as a real estate agent is to apply with as many BPO (Broker Price Opinion) Companies as possible.
What Is A BPO?
A BPO stands for Broker’s Price Opinion. Essentially banks try to minimize costs by hiring real estate agents to provide an estimated value for a piece of real estate.
The other, more costly option, is an Appraisal. An appraisal is provided by a licensed appraisal. Real Estate agents cannot provide an appraisal for value and should never refer to a CMA (Comparative Market Analysis) or BPO (Broker’s Price Opinion) as an Appraisal.
Why Do Banks Need BPO’s?
Banks need BPO’s in two main cases.
- Preforeclosure. Banks will hire a BPO agent to do what is called a “drive by BPO.” Meaning they have not foreclosed on the property but a borrower has stopped making payment. So the bank wants to get an idea, if they did foreclose what the value of the property is.
- Short Sales. When a bank is in the process of a Short Sale, they will many times hire a BPO agent to provide value once the Short seller has a buyer lined up. If the deal falls apart and another offer comes in weeks later, the bank will likely order another BPO.
How Much Can You Get Paid From A BPO?
In many cases in my experience, BPO agents are usually paid $40-$80. This will depend on area, type of property and whether if it is a drive by or interior BPO.
Interior BPO means the agent is required to reach out to the short sale listing agent and gain access to check and take pictures of the interior to get better knowledge on condition / upgrades, etc to get the most accurate opinion of value.
Commercial properties can pay much more but are not suggested to accept if you do not experience and full access to sold commercial properties through sites like LoopNet.
We listed and sold a lot of Short Sale properties. There was one BPO agent who did a ton of BPO’s just on our listings alone. I asked him one day how much he was making. He was making around $6,000 a month.
Can Real Estate Agents Do BPO’s
Yes. And you will need a real estate licensed under a real estate broker in order to perform a BPO.
Is A BPO an Appraisal?
No as mentioned previously. If you are a real estate agent and not a licensed appraisal, it is imperative to refrain from calling a BPO or CMA an appraisal.
How Do I Get BPO Assignments?
Below I will provide a list of BPO companies who provide these assignments. You can also reach out to asset management companies who handle REO properties (Foreclosures).
If you begin doing BPO’s for REO asset managers, you stand a chance at actually Listing REO Properties For Sale, which is a whole new world to make a ton of commission sales!
Can I Get REO Listings From Doing BPO’s?
Yes. Check out the link about on contacting REO / Asset Managers. If you are performing effectively in providing them accurate Broker Price Opinions and you ask for REO listings, you may get them.
Should I Get A BPO Certification?
It isn’t a bad idea to get a BPO Certification if you are new to real estate and green on valuing property.
Also, with some destination behind you, you may actually get more jobs than without one.
What Are The Steps Of Performing A BPO (Broker’s Price Opinion)
Ok. Now you have some BPO assignments coming in. What is expected of you?
Most BPO’s are comparable to the following:
- Pictures. They usually want a certain amount of interior and exterior pictures. They also want pictures showing the actual address number on the mailbox or house. And street view pics. **Be sure to follow their BPO picture instructions very carefully as you do not want to have to do a second site visit.
- Subject Property. You wil have to provide all the details of the subject property in your BPO report. IE – Size, Bed/Bath, Condition, Etc.
- Sold Comparables. You usually will have to provide 3 sold comparables.
- Active Comparables. You usually will have to provide 3 active comparables.
- Price. This is where you will have to come up with your “Broker’s Price Opinion”
Sometimes, the BPO assignment company will kick it back and say they will not accept sold comp #2 as it is too far away. This can be the frustrating part of the process. But it is what it is.
How Much Time Does It Take To Complete A BPO Assignment
If you have ever taken a listing, you probably have a good idea on how long it takes. I usually estimate around 45 minutes to complete the report. But this does not take into consideration drive time and time on site.
**Quick tip. Do not accept BPO assignments that are too far from your office or home.
BPO Assignment Companies
National Association Of Broker Price Opinion Professionals (Certification / Info)
I wish you much luck in your endeavor in making money doing Broker Price Opinions!