I was searching around trying to find out how a BPO agent is actually chosen? In the past I have had a great agent, and I was wondering if a particular lender uses the same BPO agents, or if they are pretty much randomly chosen from a list?
They send out an email blast and the FIRST to accept, gets the assignment. Appraisals are a little bit different.
In the old days they would try to influence the BPO agent to come in at a lower value.
Those days have pretty much been gone for years now.
If the bank is ordering the BPO they have mills they go through and the mill puts out the order to a few agents showing in the immediate area that are in their system. You have zero control over this. If the value on a property you are buying comes way off you can challenge the BPO to have another one performed. The bank might pay for this or make you pay for it. Then the asset manager will reconcile those two reports they get back and ask the BPO broker/agents who completed them to defend their position in value and deductions.
The asset manager will either lower the price or stick to the higher value.
I did thousands of these years and years go. I haven't completed one in probably 5 years or so. They used to pay a 100 to 150. Now they are almost like an appraisal and the BPO mill wants a 2 day turn and pay 40 bucks. Not worth it anymore unless you get urban core where you can string 4 or 5 together at a time to take pics and comps are easy. When you go to suburban and rural things get more spread out for comps and lots of deductions and time wasted driving with gas etc. and they pay the same as the urban core ones.
Joel, Thousands, Really? Is there some past life I don't know about? LOL Tighten the jib, reef the main and hold the true course. :)
A bank will first seek brokers and recommendations as to agent's qualifications, experience and an ethical side if they have had any sanctions before they send out invitations for a BPO, they can't nor would they take any jake leg who just passed a test. They may ask in an announcement but they will vet the agent and/or broker.
I know that while there is a vetting process, some banks (asset managers') standards may not be too high, but I doubt they hire those right out of school. They would be wasting time and money hiring a newbie Realtor.
One good way to vet a BPO is for the lender to ask appraisers, appraisers want business but many don't, won't, can't give a letter of opinion and appraisers know who the good agents are as they see them on the contracts for every assignment.
They lenders also know from their experience with Realtors.
Bad thing about high BPOs is that the asset manager may know good a well the opinion is off, but they can use it to negotiate with, at that point, you're pointing out the deficiencies and mistakes used in the appraisal process to beat them down and, that may just tick them off as they might figure the next buyer won't be as sharp. BPOs are a mess and came out of cost cutting needs processing REOs that got piled up on lenders, it's not an ideal way of doing business but does cut costs. And, there are a few great agent/brokers who can do a good job, many may have been appraisers!
Wowzers, I didn't know that they email and the first to accept gets it! That's interesting to know! I would have thought it was more intricate in initial choice. Is it the same everywhere? This site has some great info but doesn't explain this.
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