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What is a BPO?

You may have seen the acronym BPO come up in articles about foreclosures or loan modifications. BPO stands for Broker Price Opinion. Its name is fairly self-explanatory -- it is a broker or an agent giving his or her opinion on a property's price based on comparables active – sold criteria. The a bank or lender hires a broker/agent to provide a report with an estimated price.

Is this the same thing as an appraisal? In theory, there are plenty of similarities, but this is more the quick-and-dirty version. BPOs are often commissioned by lenders and mortgage companies in lieu of an official appraisal. They're often performed by agents and brokers, as they earn a nice secondary income by performing these services. There are two types of BPOs:

-Drive-By BPO: These BPOs are done by examining the exterior of a property and filling out the guidelines provided by the commissioning company.

-Internal BPO: These BPOs are done by going inside the property, examining the condition and quality, and taking photos to back it up. This is a more involved process.

Most likely if you see someone outside of your home taking pictures, they’re not paparazzi or a peeping Tom! So don’t chase them off with your shovel.

In our coming posts, we'll look further into the two different types of BPOs.

The views published here are the opinions of the writer and are not a substitute for legal counsel.

Israel Gonzalez

Real Estate Broker-Hollister CA

831-636-8858

www.bestreohomes.com

Click here to contact me by email

Posted: Wednesday, March 31, 2010 9:54 AM by Israel and Rachel Gonzalez

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