What is a BPO and how can it Affect a Short Sale?
A BPO is an acronym that stands for Broker Price Opinion. As a part of approving a short sale, a bank will order either an appraisal or a Broker Price Opinion (or both) to determine the market value of the property. Before approving a short sale, the bank must make sure that the offer presented represents true market value for the property. The agent they hire to complete the BPO can have no connection with selling the home. Occasionally, banks will order more than one BPO and compare them against each other to ensure that they have the value correct. Often they give the agent 24 hours to complete a BPO and pay them as little as $35 to complete it. If the BPO indicates that the market value for the home is higher than the submitted offer, the bank could counter or reject the submitted offer. As a short sale seller, it may be scary to think that the fate of your short sale may rest on a Broker Price Opinion. But for most short sale lenders, the BPO is one factor among many factors, and the REALTOR you've chosen to represent you on your short sale can play a big role here by continuing to provide additional information to the lender that may not be in the BPO. Communication with the lender is essential.
Are you considering short selling your Santa Maria, Orcutt or Central Coast home? Call an experienced REALTOR, and set up a free initial consultation. I can be reached at (805) 878-9879.
* Those considering a short sale are advised to consult with their own attorney for legal advice, and their tax professional for tax advice prior to entering into a short sale listing agreement - this blog does not offer legal and tax advice. This blog offers general information only which may not apply to your specific situation.