Broker Price Opinion:

A BPO can be looked at as an expanded CMA (comparable market analysis) that is performed for a bank or an asset manager instead of for a homebuyer or seller. BPOs require as little as some field work and gathering some comps on a property, but they can also require preparing a property for sale, arranging repairs, or investigating the condition of a home whose occupant is delinquent on mortgage or lease payments. Many times, BPOs require considerable expenditure on the part of the agent upfront, and weeks or months before those expenses are reimbursed.

The BPO of a residential property is conducted by a local, licensed real estate professional. The report combines information from a drive-by exterior examination, external data sources, previous sale data, property assessment data, recent comparable sales and current neighborhood listings, as well as a photograph of the subject property.  Photographs include subject and street scene photographs. Front photographs of all comparable sales are also available for an additional fee. This product is not an appraisal and does sometimes include an inspection of the interior of the property.

Generally, asset managers will call for a BPO in lieu of asking an appraiser to do an appraisal or in addition to an appraisal.

According to California Realtor Sherri Lum, the five most commonly used BPOs are:

Drive-by Only, no photos, no contact. These may be for REPOs but most are called for when banks sell off loans to other banks. Generally, they require 3 Sold Comps and 3 Active Comps and evaluation of the Subject is required. This is the base for all BPO's

Drive-by with EXT and Photos. These require the agent to walk around the property, determine if is vacant, who the tenant is, condition of the exterior with photo documentation and then the Base 3/3 Comp evaluation. This is most often a pre-REPO action.

Interior with Photos. Interior access with photos of each room, and any damage or improvements. Exterior photos are also required, and then the Base 3/3 Comp evaluation. This is often a PMI removal evaluation but can be a post REPO evaluation to determine list price.

Interior / Re-Key / Preserve. This is a Post REPO action where the lender secures the property at or after eviction. The agent normally has to advance pay the lock smith to perform the lock pick / rekey activities and must invoice the company for reimbursements which is typically 45 days or more. Full interior photos, documentation of any damage. The agent provides clean up and repair estimates. Often the agent is asked to prepay for clean up / board up services and invoice the lender or Asset manager.

RePo Listing: Agent gets the listing and provides a no-cost interior BPO to lender / asset manager. Develops clean up and repair costs and coordinates the activities.

Out-of-pocket expenses agents may be asked to pay are:

Re-key locks

Winterization

Trash removal

Lawn care /snow removal

Repairs needed to secure property

Board-up costs

Some repairs to improve marketability