Sacramento Expert Short Sale Real Estate Agent

Posts Tagged ‘agents’

BPO is an acronym for Broker’s Price Opinion.  In general, the term Broker’s Price Opinion (BPO) is a method that a Real Estate Broker (or an agent acting on behalf of their employing broker) uses to estimate the probable selling price of a Real Estate property/house.  This estimate is submitted in a report to the BPO Company that has ordered it. This basically is information of  properties that compare to the (subject) house that is being priced.  This is similar to a CMA that an agent would provide a seller to show the approximate value of their property.

These are done for numerous reasons, but I would like to tell you how they would play into a role of doing a Short Sale.  When taking a listing of a Short Sale there are many factors that play a role in the process of getting the bank to accept a short sale at all.  With that said you have listed the property for sale, received the whole hardship package from the seller, and submitted this package including an offer to purchase to the lender for approval.

The lien holder (bank) will then look over the package to make sure everything is complete, and then they will secure an agent or broker, an place an order to obtain a BPO on the property.  Basically the bank just wants to see the market value of the property and the condition the property is in.  This gives them some kind of idea if the offer submitted is really a good one compared to the BPO, and how much their bottom line will be.

Example:

• Home loan owed on a home is $700,000
• Listed the home as a Short Sale for $600,00
• Offer submitted to the bank of $600,000
• Bank orders a BPO to be done
• BPO comes in at an approximate value of  $640,000

 The bank now has a higher value than the offer, and this gives them great information on how to proceed with the offer.  They have a choice of doing a few things at this point

• They can accept the offer presented to them
• They can counter the offer
• They can reject the offer
• They can refuse to allow a Short Sale

Having done BPO’s  myself I now have a better understanding of a banks position.  If you have any questions about buying, selling real estate in Sacramento, please feel free to contact me anytime.

Terri Wisecarver 

REALTOR

Sacramento Real Estate 

So this has been my experience in the last couple of months. 

 In showing numerous homes to a client I have come across some issues with what is known as Flipper Houses.  After looking through the MLS for homes that meet my clients needs/wants we came across a home that we wrote an offer on. But we are noticing that quite a few of these homes are stating NO FHA loans. After talking with the agent, he stated that the seller chose not to accept offers with this type of financing.  I then started to wonder if there were issues with the property that would not pass the FHA guidelines.  This seemed to be OK with my buyers as they were getting a conventional loan anyway.

Within the next two days from acceptance and much research between me and the lender we found out the home was a FORECLOSURE purchase at sacramento court house.  I then called the agent because I had some concerns about the seasoning requirement of this home purchased like this. The seller only had it for 45 days at this point.  I talked with buyers lender and I was then told that this could possibly be an issue with financing because most of the lenders have now changed their guidelines to match FHA with FLIP HOMES.  I had the buyers lender contact the lenders which we would be using, and verified this situation. I then contacted the agent and he actually tried to tell me this was not true.  My buyers decided to back out of the deal as they did not want the money, time and effort put in on a home that probably would a dead deal.

Now let me tell you this actually happened again, but this time the seller of the home did not record the deed when he purchased the home, therefore leaving me to do my investigations by obtaining a title history on the property to find out the same story. 

Third time a charm.  Another offer placed on a property that ended up being a Flipper in the same way, but my buyers decided to wait and continue to look around.  We then found a better home with everything they were looking for and of course multiple offers with ours accepted.  Ironically the listing agent (broker of 25yrs) did some investigations on his own and found out that I was right.  The listing agent  in the mean time has contacted me back to see if my buyers were still interested in the property., of course now that the 90 days is past.

Agents need to do all they can to protect the clients they have and do all investigations on properties.  Is this not what we are suppose to do.  I am thrilled to say that my buyers will be closing in the next fews weeks in a home they are so happy with.  Needs some work but value to them will be worth it and not just gaining equity. 

Terri Wisecarver

Real Estate Sacramento