Understanding an Interior BPO and an Exterior BPO
Real estate agents can potentially make extra income by performing BPOs (broker price opinions). While it might not be your dream job, it is a relatively easy way to make money, and in this economy and with this housing market, anything helps. By understanding more about BPOs, real estate agents can determine whether they are interested in pursuing BPO work.
When Is an Interior BPO or Exterior BPO Needed?
Banks that find themselves in need of a quick estimate of the value of a home will order a BPO. This may be because they’re trying to determine whether to accept a short sale or because the home is close to going into foreclosure. They’re typically used when a bank feels as though a full appraisal isn’t necessary, although there are different kinds of BPOs. Bankruptcy proceedings and a few other legal procedures can sometimes also call for a BPO. If you are just getting started it is probably best to concentrate on BPO’s from banks as they are the most plentiful.
The less work intensive of the BPO types are exterior BPO’s. Agents will only be required to take exterior photos, sometimes including an address verification and street scene. The idea is to determine the value of the home based on the property style, how old it is, and what kind of home it is. Also to make sure there is no major damage to the property that is visible from the exterior. Information that might be included on this type of BPO can include whether or not the home is occupied, how many rooms are in the home, the shape the land and home is in, and how the home compares to the nearby properties. Some lenders will ask for specific information as well, that should be included on the BPO.
Another type of BPO is the interior BPO. With this type, the agent will actually need to enter the home. In some cases, the home will be occupied, so the agent will need to set up an appointment with the occupants in order to gain access. Similar information will need to be written down, including the shape the property is in on the inside, whether there are any damages that are visibly noticeable, and any other information the lender specifically asks for.
The external BPO should take about an hour while the internal BPO doesn’t take much longer than that. The typical payment for this kind of work is between $50 and $90. By obtaining a few of these each day, an agent can make great supplemental income and if they are able to receive enough orders even possibly fully support themselves. Performing BPOS’s is often a first step in becoming an REO broker, so if you are interested in listing REO properties, performing fee BPO’s maybe the best way to learn the business.
In order to start doing BPOs, agents will need to sign up with asset management companies that assign these after getting orders from banks. You’re required to have a real estate license, local market knowledge and access to the MLS in the appropriate areas.
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