Do BPOs always present a true picture to the lender?

By
Real Estate Broker/Owner with Waters Realty of Brevard, LLC BK3064647

The answer is obvious – a great big NO.

As a real estate agent who has completed many BPOs I know there are conditions and issues with properties I can’t document or even see.

The power may be off so if there is an electrical issue or even a non-functioning air conditioner, I would never know. This could impact the selling price bythousands.

There may be a slow leak or other issues with the roof but if there is no active leak or evidence of a leak, how would I know?  Again, if there is a problem, thousands of more dollars off the selling price.

And the poolcould it have a problem with the pumping equipment or a leak, or need to be resurfaced? Potentially thousands here as well.

Another guideline I see referenced in the BPO process…assume the interior repairs/condition from the age and exterior.  I guess if the exterior is neglected the assumption is going to be the interior condition is similar. But what if the exterior is nice and the interior is suffering? You know what they say about assumptions….

When a short sale is involved it seems only obvious – the seller (seller’s agent) must make sure the lender knows the true condition because the BPO may be way off!


Posted by

Gary L. Waters, Florida licensed real estate broker/owner Waters Realty of Brevard, LLC, Melbourne, Florida serving Florida's Space Coast including the cities and communities of Melbourne, Viera, Rockledge, Suntree, Merritt Island, Cocoa Beach and the surrounding region.

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Topic:
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Realtors®
All about Brevard: Brevard County, Florida
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Rainmaker
233,579
David Grbich
Orange County Real Estate - 949-500-0484
Ventana Coastal Properties - www.FindCARealEstate.com
Hi Gary - could not agree more. I have a short sale listing now with an unpermitted addition - challenge is knowing if it got noted as the BPO is not shared. Regards Dave
July 05, 2012 06:46 AM
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Bob Crane
Forestland Experts! 715-204-9663
Woodland Management Service

Its unfortunate that many bpo's are inflated intentionally just to get the listing, which just leads to a lot of frustration and deteriorating home while the price adjusts to a reasonable selling price.

July 05, 2012 06:49 AM
Rainmaker
965,321
Gary L. Waters, Broker Owner Waters Realty of Brevard, LLC
Personal Service, always.
Waters Realty of Brevard, LLC

David - So true. I guess I am thinking more about is as a listing agent myself right now.

Bob - So true. Thanks.

July 05, 2012 06:55 AM
Ambassador
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Doug Rogers
Your Pineville Louisiana Agent
Bayou Properties Realty

My favorite are the BPO mills that pressure rookie agents into inflating values. I had a listing languish on the market for 105k for almost a year. An offer comes in close to that and the bank rejects. Why? because the "appraisal" came back at 135k!

 When pushed the lender disclosed that the "appraisal" was actually a BPO by a rookie agent. How many homes had Ms. Rookie closed in her career?? NONE!!!

 Yet her "market knowledge" almost sank my transaction. Cheaper is not always better.

 

July 05, 2012 06:56 AM
Rainmaker
965,321
Gary L. Waters, Broker Owner Waters Realty of Brevard, LLC
Personal Service, always.
Waters Realty of Brevard, LLC

I only do BPOs in my local area - within about a 4 mile radius of my office and home. I know the area but I wonder about the agents who do the BPOs on my short sale listings.... Thanks.

July 05, 2012 07:00 AM
Rainmaker
613,732
Sandy Shores Broker, Melbourne FL Real Estate
Brevard County Real Estate
M & M Realty of Brevard Inc.

Hi Gary, Hope it was a great 4th of July for you.  This is a great post.  There are so many factors to take into consideration with a BPO.  Sometimes they don't portray a true picture of the property.

July 05, 2012 11:24 AM
Rainmaker
1,021,284
Lisa Von Domek
....Experience Isn't Expensive.... It's Priceless!
Lisa Von Domek & Associates LLC, Real Estate Broker/Associate with Real Living Real Estate Group www.LisaVon.com

Hello Gary,

The BPO is only as good as the agent handling it...many are performed by new/rookie agents as an income generator and they may not have the experience necessary for this.

July 05, 2012 01:01 PM
Rainmaker
965,321
Gary L. Waters, Broker Owner Waters Realty of Brevard, LLC
Personal Service, always.
Waters Realty of Brevard, LLC

Sandy - It was...thanks! True the picture is sometimes pretty blurred.

Lisa - Again, so true. Thanks.

July 05, 2012 04:40 PM
Rainmaker
686,322
Kwee Huset
Venice Florida Homes For Sale
Kwee Huset Realty

Good morning Gary, there are so many unknown conditions until the inspections are done. e.g. septic, dry wood termite...

July 08, 2012 04:22 AM
Rainmaker
1,880,428
Roy Kelley
Roy and Dolores Kelley Photographs
Retired Real Estate Broker, Maryland Blogger

An excellent topic.  The low fees for BPOs attract some of the least experienced agents and sometimes they delegate the details to an assistant.

Have an outstanding week with your camera in hand.

July 08, 2012 05:07 AM
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Amanda and Jared Christiansen, YOUR Fort Wayne Realtors
Century 21 Bradley.
Century 21 Bradley (260)704-0843

My wife Amanda used to do BPOs a lot.  They are nothing more than an opinion, and you are right, she can't see or know the true condition of the home.  Great post.  Suggested.  

July 08, 2012 05:18 AM
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Jennifer Fivelsdal
Mid Hudson Valley real estate connection
JFIVE Home Realty LLC | 845-758-6842|162 Deer Run Rd Red Hook NY 12571

Gary so true BPO's don't tell the full story.  With so much emphasis on BPO this was a good topic to tackle.

July 08, 2012 05:44 PM
Ambassador
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Toni Weidman
23 Years Selling Homes in New Port Richey, FL
Re/Max Sunset Realty

BPO's don't seem to take a lot of things into account, Gary. It's unfortunate that most BPO agents don't seem to want to communicate with the seller's agent.

July 09, 2012 08:10 AM
Rainmaker
347,031
Bruce Walter
Keller Williams Realty Lafayette/West Lafayette, Indiana

Gary, I agree with many of the others that the BPO is as good as the broker performing it, and yes with the utilities off it does make it difficult to get the full picture.  Hopefully there are no more DRIVE BY BPO's which were insane!

July 10, 2012 06:23 AM
Rainmaker
965,321
Gary L. Waters, Broker Owner Waters Realty of Brevard, LLC
Personal Service, always.
Waters Realty of Brevard, LLC

Kwee - Thanks. Have a great week!

Roy - Thanks. My camera in hand is no much for you!

Christiansen Team - Thanks!

Jennifer - Thanks. They are important!

Toni - I have spoken with the seller's agent. Nothing prohibits this as long as values and contracts are not discussed.

Bruce - BPOs are serious. I just think some agents see them as easy gas money. Thanks!

July 10, 2012 09:06 AM
Rainmaker
1,772,399
Gabe Sanders
Stuart Florida Real Estate
the BlueWater Realty team specializing in Martin County Residential Homes, Condos and Land Sales

Unfortunately, with the way BPO's work, the low pay, the unknown qualifications of the agents, etc., there is no quality control.  There may be some very good BPO's as well as some really bad ones.

July 11, 2012 05:04 AM
Rainmaker
973,576
Sharon Alters
Your Fleming Island Relocation Agents.
Coldwell Banker Vanguard Realty

Gary, I only do BPOs for my foreclosure listings, and I agonize over them. You're so right, there are so many things that you don't know at the beginning. It takes me 2-3 hours to do a BPO. I don't see how people churn them out. It takes time.

Sharon

July 17, 2012 08:06 PM
Rainmaker
682,433
Steve and Jan Bachman
Realtors - Northern Virginia
RE/MAX Gateway, Reston, Herndon, Ashburn, Sterling, Fairfax

Good one Gary, this is so true. With the short sale wave continuing for years to come we need stay sharp on how to relate to the lenders.fairfax county real estate agents Jan and Steve Bachman

July 20, 2012 07:59 AM
Rainmaker
393,240
Regina P. Brown
e-Pro Realtor
California Coast & Country Homes, Inc.

Gary, it really needs a thorough inspection to see those types of problems.

 

July 21, 2012 08:47 AM
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Rainmaker
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Gary L. Waters, Broker Owner Waters Realty of Brevard, LLC

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