I have been teaching and doing short sales for several years. Recently they have become the "hot topic" in the real estate investor market and suddenly everyone is an expert. Another edge I have over the "guru" world is that I am not only an investor and a trainer but my "day job" is as Director of Operations for Novation Mortgage and part of my job is as Quality Control and Loss Prevention Manager. That's right, I get to approve or deny short sale offers.
When we receive an offer on a property that is in the Default period the offer comes to my desk. Now unlike large national lenders I don't have thousands to review, I generally have one. But here is one of the steps that makes the process seem like it is taking forever.
The Broker Price Opinion or BPO. Some lenders actually use a listing agent to go view the property and give their evaluation. Others use an electronic AVM which some smart data providers like First American have started labeling as BPO's. My preferred method is an experience, reliable, licensed real estate appraiser. Regardless of the method used by the lender you are offering to this process will take at least a couple of days and sometimes as much as a week. This is one event that is beyond the control of the lender's Loss Mitigator as to how fast an answer is delivered. So no, we're not always just sitting on our duff's playing online golf at Nabisco.
Here is something YOU as a buyer or buyer's agent need to know and use about the BPO. You can contest the value. For example, if you know that there is a water leak in the roof that the evaluator did not discover you can show proof and possible get the value lowered. Same goes for mold or termite damage that may not be discovered during the evaluation. When you submit your offer to the lender make SURE you detail all of the disclosures from the homeowner to establish a more accurate value reflective of the condition of the property.
Still don't know about Short Sales? Still missing this fantastic opportunity? Well, what are you WAITING FOR?
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