I am about to discuss one of my pet peeves. I don't know about agents in other areas, but this happens a lot around here. I wish more Asset Managers would be aware of this going on and find more honest, conscientious agents to do their BPO and REO work...
"Hi there! I have an order to do an interior BPO on your listing at....." Great! The bank is moving forward and we are that much closer to getting this foreclosed property on the market and sold for them! I have already submitted my BPO, in most cases, and now the bank has hired another agent (or two) to perform what they refer to as "2nd Opinion BPOs." Some banks get full appraisals, but most rely on Broker's Price Opinions to set a list price for their properties. One of the big concerns for the agent doing the 2nd opinion, is property access. It is very important for the listing agent to make sure there is a lockbox on the property as soon as possible so other agents can get inside and do their job, which helps get the property listed more quickly. Usually the 2nd opinion agents call to let you know, but I have had some who didn't extend me that courtesy. The bank had sent them the lockbox code, they went it and did their inspection and I never knew. Well, sometimes I would find the lockbox left on the code, doors unlocked, or personal property remaining that had been gone through or taken, and had to wonder who had been there, but that is a whole different subject.... In short, listing agents, cooperate with the agents doing the 2nd opinions, if you want the house to ever get to market!
"Is there anything I should know about the house? " This is a valid question that I get asked a lot, and I ask it when I am the second-opinion agent. It does NOT mean the other agent isn't willing to do their work, it means they realize they cannot see it all in one inspection. Ralistically, the listing agent has probably been inside the house several times and has a good idea of any problems that would impact the value. Things like stolen plumbing lines, water in the basement when it rains, structural deficiencies. This IS the time to tell the other agent to use the side door because the front one was falling off and the property preservation people nailed it shut. This IS the time to tell them to use flea spray before they go inside. This is definately the time to tell them about the soft spots in the floor so they don't get hurt. These are things that are not only for their safety, but also can impact the value. if you have noticed some outlets that appear to be scorched, tell them. If your research discovered the house is actually a mobile home that was built around, tell them. These are things that might not be seen during one inspection, but which will affect the price a property sells for.
"So, where do you want me to bring it in?" This is the question that really upsets me. THIS is a sign that the agent either doesn't know what they are doing, doesn't understand the importance of their report to the bank, or is just plain lazy. My guess is that most just don't realize how important their opinion is. So what do I say when asked that question now? I tell them "wherever the comps you find indicate it is likely to sell." That is what a BPO is about; what price this property likely to sell for, in a specific time-frame, as requested by the bank, the client. You do remember and keep in mind who your client is, don't you? You understand the concepts of due diligence and confidentiality? If not, you probably need to go back to real estate school, or find a new career. When I told one agent "You know that I can't tell you that! That information is confidential." she replied, "Well the rest of us all work together on these. We ALL look better when our numbers come in real close." Do we? I don't think so! How likely is it for 2-3 people to have matching opinions on any subject you poll them about? How likely are they, when asked to justify their opinions (provide comps and adjustments), will they all have the same reasoning, or worse, different reasoning but the same conclusions? It is highly unlikely! So where do I want you to bring it in? Wherever your comps lead you to believe it can be sold, in this market, in the time specified by the client. Don't guess, don't pull comps and forget to make adjustments, don't try to buy the listing by pricing it higher than you think I did. Be realistic.
Asset Managers do keep track of these things, you know! Okay, maybe not ALL of them, but many keep stats on the values an agent brings in, and the eventual sales price. If your numbers always come in much higher or lower than where a property ends up selling, you aren't likely to get listings or much more BPO work. If your reports are complete and the values close, they see you're doing a good job and are likely to keep using your services. I had one asset manager tell me, when I asked about the 2 second opinions done for one of my listings, that they thought it was odd that both agents came in within $50, yet had entirely different comps and had adjustments that were not uniform. They requested another opinion, which came in closer to mine, they listed at my value and sold the house in 30 days. The other 2 opinions? The house would still be sitting there, unsold.
Why do they need my opinion, anyway? Because they are not from your market. They do not see what has sold or what is on the market first-hand. They have to depend on agents, so-called "professionals," to tell them what the market is doing in their area. The rely on your experience and knowledge of the market, current trends, available comps, and understanding of what buyers want and what financing is available there. They need to know how best to get their properties sold. This doesn't mean they want to give them away- they are in business to make money and need to feed their children, too. But they make nothing if the property won't sell. They could rely only on their listing agent's opinion. Obviously they trust it enough to have the agent represent them. But often 2 opinions are better than one. Everyone has a slightly different perspective on the market and see trends differently, based on the people they deal with. The banks need that information to help them see all the factors that may influence the sales price and set a more realistic place to list their properties.
If you do not have enough confidence in your ability to provide a good BPO, don't do them. If you think a "2nd opinion BPO" should merely be the listing agent's opinion with your name on it, don't do them. If you don't think your opinion truly is important, then you have no business providing it to anyone. If you are not willing to do your own research and work on a BPO, then you need to refuse the order and let the bank find someone who will. If you are interested in buying the property or know someone who is, don't bring in the value low hoping for a bargain, turn down the order so the bank can get an objective opinion. Given the current trend, there will be many more bank-owned properties coming on the market this year, and the banks need accurate, high-quality BPOs in order to price them competitively. Prepair your 2nd opinion BPOs as thoroughly as I hope you do for the properties you list. Either way, the bank is your client and deserves your best work.