How to BPO

Real Estate Agent with Cutler Real Estate

I've been stewing over something for a few days.  Not sure if I wanted to post about it, but then a couple people have brought up that NABPOP thing, and that's exactly what's been stickin' my craw over Labor Day Weekend.

While speaking with another REO agent, a long-time, veteran REO agent, I thought I'd pick their brains for minute, when I had them on the line.  Last week was my Hell Week for BPOs.  Nothing easy, all obscure properties for the area they were in, never any good, or even half way decent comps, properties were out in BFE, etc, & I'm sure ya'll know how it goes.  One in particular was extremely difficult, urban area, but a high-end urban area, about 110 years old, and like 3000 sq. ft.  So I ask the agent for advice, any other comprable neighborhoods I could use, any suggestions, and what have you.  The agent brings up NABPOP, and how great the info is, and blah, blah, blah.  But I honestly almost choked on my coffee when the agent brought up some things in "training book" thing.  GLA should be w/in 200 sq ft, always look for comps w/in a 1/4 mile, 10 years either side age-wise, and more blah, blah, blah, as for as I'm concerned.

I certainly don't know it all, and am always willing to learn, but what that agent was telling me, was so far out of line with the way I was taught, as well as most companies' requirements, it wasn't even funny.  So for those of you that wanna know, here's how Katie does her BPOs.  (Usually without issues, lol)

GLA - 20% of the subject's GLA unless requirements state otherwise, some want it w/in 15%, if it can't be done, an explaination is needed.

Age - 20 years either side of the subject for older homes, or hard to comp areas, newer construction, usually 10 on either side.

Mileage - 1 mile for urban, 3 for suburban, 10-25 for rural/extreme rural

Sale date - I'll check everything w/in the last 6 months, but as prices have been flat to declining, most of my solds are from the last 3 months now.

Condition - Especially important in REOs!!!  Having comps in similar condition is crucial!  As is havng at least one active, one sold in better condition than your subject

Bed/Bath Count - Having an active & a sold with the same bed/bath count is important, but you can (I think) adjust values for these much easier than anything else

One of the way cool things about BPOs, is that for some reason, if you can't meet the requirements, things are usually expandable.  Whether it's the age range, the GLA%, the area, just make a ton of notes of why something couldn't be met, and most times you're covered. 

Hope this helps some of you out when you're doing the BPO thing!

Comments (18)

Universal REO - Syracuse, NY


I grew up in Akron, OH and know what it's like in that area finding comps.  The houses were all built around the economy of the time, typically reflecting how well Firestone, BF Goodrich, and Goodyear were doing at the time.  The housing for 40 miles in every direction was built to accommodate the  influx of living from around the nation as the rubber industry grew and these large behemoths pushed for appropriate housing to match the pay scale.  And if you get far enough north, say Bath or Brecksville, you're now talking about steel instead of rubber...but the same concept.

Reality is that NABOP or any other organization for that matter, can give you more instruction on what you already appear to know, possibly offer insight that you never had, or possibly emphasize what you already know.  But the best advice you can take is to continue to focus on your region, become an expert on the history, the neighborhoods, and the market then stick to your guns when there are value disputes. 

Use your instincts when pulling difficult comps and consider the idea that you may have to pull 2 sets of comps - one for the type/style of house, one for the region.  We've had to do that in Denver when an expressway was built right down the middle of a ranching area.  Things just don't have a rational rhyme or reason.   That's why you're the REO SPECIALIST...and that's why it's called a Broker Price OPINION.  

I hope that my 2 cents helps.


Sep 04, 2007 04:24 PM
Kathleen R. Cosner
Cutler Real Estate - Akron, OH

Thanks for the comment Daniel.

I'm more miffed, because I feel that the instruction being provided is inaccurate.  Inaccurate instruction leads to bad practices, and therefore, to BPOs that are unreliable. 

With so much riding on a BPO, short sale, divorce, f/c, BK, re-fi, HELOC, PMI drop, or note purchase, it's important to be accurate/inline with the market area & values.  To do so, agents should be on the same page as far as locating comparables.

If 4 BPOs are ordered within say, 3 months on a given property, even in an area that's declining, the values shouldn't be that far off from each other, given of course, agents search using the same basic search method.

Sep 05, 2007 12:38 AM
Tiffany Domneys
Execuhome Realty - Baltimore, MD

I learned from Kim (founder of NABPO,and Kim Class) and it has helped me through my entire career as a BPO agent. By no means am I endorsing, or suggesting you guys to pay for information, I personally think it's enough here so stop being lazy (lol) do your research!!! You can never get enough information. Also, be careful when asking other agents in direct competition questions about BPO's and REO's. They will give you misleading and sometimes false information just because you asked. Some will even refer you to companies that don't pay!!!! Always remember this business is very competitive, especially with the market being the way it is, more and more agents are trying to tap into this side of the business. We need to start a more secretive society so that we can share more information, and not have to worry because we know it's private!!!!! Please, if anyone has any suggestions I'm all ears!!!!

Sep 06, 2007 03:33 PM
Universal REO - Syracuse, NY

Amen Tiffany.  It's a funny profession with two ends of the spectrum.  First you have people like Melissa Schnieders who gives quality information all the time, then you others who truly are deceitful to run people off in the wrong direction. 

Katie, I hear ya too.  I remember when I first got into REO how confused and frustrated I was at the answer I would receive when I'd ask "what's the standard protocol for _________?" and the answer would be something along the lines of "well, it's different for every bank, every asset management company, every portfolio manager, and..."  WHAT???!!!!  But alas, I came to grips finally with the dynamics of the job.  Not to mention to lack of standard protocols.

A good friend of mine with 20+ years of appraisal experience provided me some good, quality guidelines to work within when pulling comps.  I also used to go to him early on for guidance on the tricky subject properties that would stump me.  I have tried to streamline these bits of advice that added up over the years on my website, but it's nearly impossible to nail them all.  That's why I'm such a believer in blogging.  There's SO much good information out there covering so much great material.  And to be frank, your very frustrations are the same frustrations that fueled me to design my site.

Tiffany - As for a secretive society I would recommend building your own blog (say on Wordpress or Blogger) and make it set as private and only people you invite/allow can enter.  Check out mine and see how well they can turn out (and I'm no graphic designer or programmer).
Sep 07, 2007 04:13 AM
Paul Moye
Benchmark Realty - Franklin, TN
Broker, GRI, SRES
I was curious why any of us would think this info is proprietary, secretive or special? I have been doing BPO's for longer than most of the guys on this BLOG have been in real estate. Katie your info is good, glad to see you share it but why are others suggesting we keep this to ourselves?
Sep 09, 2007 03:40 AM
Universal REO - Syracuse, NY


I realize that some people can be trusted and that with your veteran status you most likely don't rely on others to help you with you already-developed business.  However, just like any other industry the next generation will move in to help the veterans to pass on the trade.  Unfortunately, this next generation is limited to resources. 

Let's be honest, real estate, particularly REO, isn't like so many other professions such as medicine, accounting, etc.  There is no bachelor's degree in REO.  There is no PhD in BPO's.  The youth who area doing their best to get into the business, knowing full well that this IS the best way to accumulate profitable business, have limited resources.  And when someone comes along and throws them a bone in the wrong direction, the limited time that they have to successfully launch their business is jeopardized.  

You bring up a great point about this business is not proprietary, secretive or special.  Your support for our education development at is unique and appreciated based on this statement.



Sep 10, 2007 04:49 AM
Brandon Causey
Coastal Palmetto Realty LLC - Loris, SC
Realtor, Coastal Palmetto Realty LLC
great help
Sep 11, 2007 10:57 AM
Brandon Causey
Coastal Palmetto Realty LLC - Loris, SC
Realtor, Coastal Palmetto Realty LLC
Where can I get some reference material?
Sep 19, 2007 05:35 PM
Universal REO - Syracuse, NY has some great reference material for free and for members.  ActiveRain is a GREAT resource, and you can get some incredible news and media from


Sep 21, 2007 07:06 AM
Vicente A. Martinez
Prudential Douglas Elliman Licensed Real Estate Salesperson - Woodhaven, NY
Realtor, Brooklyn - Long Island - Queens Homes
This was very useful... Best of luck and keep doing what you do.
Oct 26, 2007 03:13 PM
Carmen Offutt
La Rosa Realty - Altamonte Springs, FL

Even though I do not have so much experience doing BPOs, I do know the market I work.  I believe that should count for something.

Oct 27, 2007 05:38 PM
Stephen Meadows
Coldwell Banker - San Antonio, TX
Brand Ambassador
KNOW YOU'RE NUMBERS! I strongly believe that a small investment of time studying the MLS will do wonders for your quality. Learn absorption rates to more accurately depict the marketing time. Don't say it's 90 days if it's really 120. This will be crucial, especially in REO values. Banks pay us to know these things. Even with BPOs, we need to show value in our services. It will pay off, trust me! I have quadrupled my business in a new market in only a year by being diligent in my work
Oct 28, 2007 03:48 PM
Jeffrey Dolfinger
24/7 Realty Inc. - Poughkeepsie, NY
NRBA Member

BPO's are like liver or lima beans,  you'll lean to like them and with that do them well. For the information being private, well if you have built a mouse trap and been catching mice for years your happy.  Now every agent out there is copying your trap and catching the same mice so you do not eat as well.  I have to agree with the keep it private thing.  the new guys will be gone as soon as the tide changes, and for those of us who are old enough remember doing BPO's with no web!  Key REO agents are crucial to the lenders, newbies should have to prove themselves and do it themselves.

Oct 31, 2007 04:25 PM
Universal REO - Syracuse, NY

E Jeffrey - It sounds to me like you are thinking that technology is going to disappear.  I'm considering the possibility that you must reconsider the future of real estate.  REO is not about BPO accuracy anymore, albeit it's critical, it's more about disposition and without technology you, nor any professional will not be able to keep up with the new tide.  

My suggestion is to consider the fact that technology will be the only way to keep up with the true statistics (over 80% of current buyers purchase a minimum of 50 miles outside of their primary residence and have made their decision from the internet before ever making a phone call - how are you listing your REO's?  MLS?  Does that reach these buyers?).  Without understanding your clients and customers you'll never be considered a leader.

Nothing personal, I just disagree with your comments whole-heartedly. By the way, nothing is a secret anymore.  Not to the agents, and definitely not to the consumer.  That is a disillusion.  

Oct 31, 2007 04:39 PM
Jeffrey Dolfinger
24/7 Realty Inc. - Poughkeepsie, NY
NRBA Member

I'm not against the web and I think you misunderstand my comments.  First I spent 9 years running a private equity group purchasing distressed debt and RMBS from the FDIC/RTC and S&L's.  Doing everything by hand including due diligence was nuts, pdf makes life easy as does the mls.

My concern is that all of the new REO/BPO guys are here only to make a buck and do not have a true passion for the biz.  If there is a lack of passion, risk management (asset recovey) may be compromised.

Some agents simply do not care and lately I have seen alot of them.  Listing agents with their first REO scared to enter the property, that have not done the trashout etc.  Hot water heater leaking with mold growing up the walls.  But hey they'll get their fee.  Maybe the banks should make an REO agent post a bond.  Put up or shut up I say.

Oct 31, 2007 04:49 PM
Jeffrey Dolfinger
24/7 Realty Inc. - Poughkeepsie, NY
NRBA Member

To add to my last post, some of my friends are still in the biz, at Citi, Chase, and Allied.  Two of them handling commericial REO, one a wholesale underwriter.  Their comments-  New agents with no experience have little place in REO.  It was put to me this way.  Would I (my bud at Citi) hire a person who was not formally credit trained, to handle OREO (no mispelling there)  either multifamily or retail property?  No way they probably do not even know how to figure the cap rate! So why in the residential world is there not a baseline of experience or minimum credentials?  In the end its all about ROI!



Oct 31, 2007 05:00 PM
Stephen Meadows
Coldwell Banker - San Antonio, TX
Brand Ambassador
Jeffery, I just noticed your post. I wanted to let you know I agree with you. I am very passionate about the REO business. I treat my REO clients like any other client and do my best to protect their asset, while also getting them a fast sale price. I admit that I like the money, but I more concerned that my clients are satisfied with the job I have done. I understand your frustration and think your comments are valid.
Dec 18, 2007 02:59 PM

I am just attempting to get into REO & BPO.  I am looking forward to the challenge.  All of the information

you guys are posting is very helpful. 

Jan 04, 2008 09:46 AM