BPO - What a Realtor thinks about them

[Dale Smalley]

First of all there is nothing wrong with ordering, buying or producing a Brokers Price Opinion. It is not Illegal Immoral or bad business.

The question asked to a professional real estate broker is, How much could we reasonable sell this property for and how long will it take?
This not a question for an appraiser to answer nor is it intended to be an appraisal. There is a big difference. The salesperson creates the market and the appraiser reacts to the market. Remember nothing gets done untill someone sells something.

 

[Mike Garrett RAA]

I am so glad I live in Colorado. It is illegal for a real estate agent (not all are REALTORS®) to do BPO unless they are either attempting to obtain a listing or involved in the transaction. If they are doing these for lenders and charging a fee, they are doing an appraisal and required by the state to be licensed.

If this is occuring in your market, turn the suckers in! I don't know of any lending institutions what permit PMI removal based on a CMA. In fact, most will not even accept a 2055 for this purpose and insist on a 1004. Lastly, file a complaint with your local Board of REALTORS® if you think those agents are doing something in violation of the Code of Ethics. Guess I have an advantage since I have full membership in the board.

 

[Mike Simpson]

Mr. Garrett-

I don't know of any lenders accepting BPO's for PMI removal either. However, President Clinton did make this a viable option during his administration.

Additionally, you seem to be in an excellent position to take advantage of your dual licensing (assuming you're a licensed agent).

So many others on this forum are in position to do the same thing. It isn't that difficult to get your agents license, and some states will allow an appraiser with a specified number of years experience to take a specified number of specified courses, thereby allowing them to challenge the Brokers exam.

I think this is an excellent opportunity for further diversification. Then when it comes to BPO's you're both an appraiser & a broker. How can this be a negative opportunity???

-Mike

 

[Mike Garrett RAA]

Mke....

Please call me Mike too...I have been a licensed real estate agent (broker) since the late 1960s. Our state has an agressive Board of Real Estate Appraisers. The administrator, Mr Stewart Leach, is now President of the national what ever of real estate boards and is know throughout the country. He comes down to Colorado Springs and speaks to our local appraisers group (carea.net) on an annual basis.

Stewart says "you can be one or you can be the other...just don't mix the two." I do some real estate transactions (very few) and I do alot of appraisal work (very many). I always make sure they know which hat I am wearing.

Our licensing laws were pretty well written, not like the Florida one listed above. The Colorado board says a BPO done for a lender where the real estate agent is not involved in the transaction is an "appraisal". You can call it anything you like, it is still an appraisal and you are required to be licensed. They want your money every three years...and I approve!