Short Sale Home » General Short Sale Info » What is a BPO?

BPO stands for Broker Price Opinion and is a method that a real estate broker determines the value of a property.  The value is submitted in a BPO report ( a small report consisting of 2 to 3 pages) and will incorporate the comparables of the surrounding areas and appraisal.

When performing a BPO analysis, the Real Estate Broker has been asked by the lender or bank to submit an estimate of the value of the property in a BPO report for a fee.  A BPO may be ordered in the following situations:

• home equity lines of credit or loan
• requests to remove PMI (Private Mortgage Insurance)
• REO/Foreclosure/Short Sale

The BPO Process:

1. The bank will receive an application for for a Home Equity Loan, Line of Credit, Removal of PMI or REO/Foreclosure/Short Sale.  The loan officer will determine the value of the home.
2. The bank contacts a BPO Company for a BPO (they may order multiple BPOs to make a comparison) on the property.  Usually a timeline of 1 week is given for a BPO.
3. The BPO company maintains a list of Real Estate Professionals that perform BPO.
4. The Real Estate Professional contacts the homeowner to schedule an inspection of the home or property.
5. The property is physically inspected
6. The market information for the surrounding real estate market is compiled
7. The finalized BPO is submitted
8. The BPO Company conducts a quality review of the BPO
9. The BPO submits the final BPO to the bank or lender
10. The Real Estate Professional is paid
11. The bank or lender pays the BPO company
12. The bank or lender makes a final decision based on the BPO.

Tags: foreclosure, home equity lines of credit, private mortgage insurance, real estate market, timeline