BPOs What To Know
Broker Price Opinions
I attended a meeting recently and one topic discussed was RE Agents and Brokers performing Broker Price Opinions on behalf of sellers (banks).
Here's what I learned:
It is legal for Agents to prepare BPOs
Agents can prepare BPOs for prospective clients, banks and lenders as long as there is a possibility that the Agent will be granted the listing, and providing the BPO is done correctly. If you know that there is no possibility of being granted the listing, you should not do the BPO.
BPOs or transmittal letters must be written in the following or similar language: "This is a suggested listing price done in anticipation of getting the listing."
Do Not use the word value in a BPO. You're not appraising the value of the property, you're giving an opinion of it's listing price.
Frequently banks and lenders have their own BPO forms that they want the agents to complete. Those forms frequently use the words "value", be aware this.
You Must use the "This is a suggested listing price done in anticipation of getting the listing", language IN the BPO.
Agents can charge a fee for preparing BPOs as long as they do so within these guide lines.
NEVER offer opinions of VALUE, only of listing price
You can register with certain websites for BPO opportunies and learn more
Here are some of the websites: Land America's website, Clear Capital, Single Source, I Mortgage, ASGBPO.com and register with NFSTI.com
Good Luck
PRE-AUCTION PRECAUTION
Buyers ask me all the time what I think of or know about Bank Foreclosure Auctions.
I know it kind of goes like this:
Bidders must register (usually online) and get pre-qualified with a lender before attending the auction. Even if they're paying cash.
Bidders are given a catalog of the homes to be auctioned. They select from the catalog which homes to go and see at an Open House to be held approximately 2 weeks before Auction Day.
This is their opportunity to have the home or homes inspected at their own expense (between $300 and $500 per inspection). Bank owned foreclosures are sold AS-IS, so it's always in ones best interest to have them done.
Bidders must be prepared to bring a Cashier's Check in the amount of $5,000.00 to the auction. If they win the bid, a 5% premium is added to the home price and that total becomes the Bidders actual purchase price.
The winning Bidder then signs confirmation that he/she has won. If financing and not paying cash, the application for full loan approval process is kicked into gear right away. The Bidder then waits to recieve an answer from the seller (bank) as to weather or not they accept the offer. If they do, they will ask you to close escrow in 30 days.
Here's the precaution:
Prior to the home going to auction, the seller (in this case the bank) will already have established an undisclosed minimum selling price, or "reserve price". The starting bid is not the "Reserve Price", but what ever it is, Bidders must meet or exceed it. Otherwise the home will not sell that day and the bank is likely to put it back on the market.
If the buyer goes through the lender designated by the auction, but can not get approved, then they'll get their money back. If using their own lender (an outside lender) and can not get approved, they may not.
If they find something wrong with the home after they win the bid, they may have no choice but to move forward.
On the whole however, if you know and understand the drill. If you have done your homework, have read and understand the terms and conditions of the auction and buying process, it's possible to save some money. I question weather it's enough to justify the limitations of the process. If you're determined to go, take your REALTOR with you to be sure you're represented by a professional. Good Luck
Earlier this year the feds created the $7,500 home ownership tax credit as part of the Housing and Economic Recovery Act (H.R. 3221). This should help you decide if you're on the fence about buying now. Combine the tax credit with current low interest rates, a huge selection of inventory for sale, and reasonable home prices, and you have a good market in which to buy. NOW! Buyers have until July 2009 to make a qualified purchase The tax credit can be taken in a single tax year. Authorization ends July 1, 2009, so if you wait to buy in the first half of 2009 you can take the credit on 2009 tax returns. Taxpayers can take the credit on their 2008 returns if they bought this year (2008) after April 9. If you exceed the income limit, you can still benefit from the credit. The credit amount is set as percentage of the home purchase amount at 10%, so you can get 10% of the home price credited against your tax liability up to a maximum $7,500. If you make more money than the income limit of $75K (for individuals) and $150K (for households) GREAT NEWS! Individuals whose income exceeds the limit of $75K but don't make more than $95K can still take the credit but on a reduced basis. The same thing applies to households earning up to $170K. By the way, any house is eligible as long as it's used as a primary residence and is in the USA. Payback The federal government requires the tax credit to be paid back in small, 6.67% increments over 15 years, but repayment is to be no more than $500 annually and payments will not start until 2011. No pre-authorization needed to purchase There is no pre-purchase application or approval process. Eligible buyers just have to claim the credit on their IRS Form 1040 tax return. New-home construction qualifies. For a home that a buyer constructs, the purchase date is the first date the buyer occupies the home. But a home that is not a primary residence, i.e., a vacation home or income property, does not qualify. Call me any time, Keri (702) 563-5792
I must be way behind, having only just read the Agents boo hoo blog about losing a deal to a young woman with "big boobs". How the heck does he know she only did 5 deals that year? How does he know the reason he lost his deal was because of her "boobs"? How many men do YOU know in a position to spend over $100,000 on a piece of Real Estate? Do you honestly think his brain is that far into his pants that he would risk that kind of money, ANY KIND OF MONEY because of a pair of "boobs"?
I say GET OVER IT BUDDY! I'm a woman, yes, and I have "boobs", yes but I can't tell you the number of deals I haven't gotten because of the "Good Old Boy" philosophy! PLENTY! And what do I do? I move the ______ on! As should you "Sir". I'd be willing to bet you lost that and most likely plenty of other deals not because another Agent had body parts that you don't.
More likely, it's your MENTALITY! You need to check yourself if you can't compete with a nice pair of "boobs" .. how embarrasing for you! Uggggg... big spoiled baby got his ego crushed? WAAAAAAAAA!!
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