You've got this wrong. Line 520 is "total reduction amount".... this the total of closing costs, commissions, payments to other lien holders, etc. On a $450k offer, disregarding other mtgs/lien holders, you're probably around $30-40k with commissions, closing costs, etc. Line 520 is Not the total of the mtgs or the shortfall in the payoff.
Your title co. or closing attorney should be the one filling this out....they know what they're doing and do this every day.
Also, not sure sure why you are calling this a disclosure form, it's a closing statement which shows all costs associated with the sale and the Net to the lender.
Do you have a negotiated pay off number from the 2nd?
Sounds like this is someone's first rodeo either on the title side or the sales side. That's stepping into the deep end of the pool without floaties if you ask me (I know...you didn't).
I'd follow Wayne's guidance and if they are the one's filling it out and have that level of disconnect at this stage of the process, I'd get another title company.
On another note, if your offer is $450M and the BPO is $650M and the total debt is $850M, I think your going get to a point real quick like where this deal will fall apart. There is no lender in the world that I'm aware of that is gonna leave $250M on the table for the buyer to absorb as instant equity.