Ok, so you've received the short sale requirements from the lender and you've made friends with the loss mitigations rep that's assigned to your potential deal. Next, you are now ready for the lender to order a BPO on the property. Notice that I emphasize "you", this is because I don't want you to miss out on a key opportunity to influence the overall outcome of your short sale.

Although many investors are aware of the benefits of influencing the BPO, few know exactly how it's done. The BPO is the single most influential component that the lender considers when deciding how much they are willing to accept as a reasonable short sale offer. If your offer is not in the ballpark of the BPO it will most likely be rejected. Many investors give up at this point and assume that the lender is not willing to accept a short sale. It's not that the lender is not willing to accept a short sale, it's that the short sale offer does not come close to the amount of the BPO. It's just that simple. There is a big difference between a lender not accepting a short sale and a lender not accepting the offer.

What exactly is a BPO?

BPO stands for Broker's Price Opinion. All this means is that a real estate agent or broker will assess the property and give their professional opinion of it's value to the lender. The closer that number is to your offer the better. You want the BPO to be as low as possible. Listed below is a snap shot of a BPO requirement.

1. Run comps and take pictures of the surrounding neighborhood, subdivision, or area.
2. Inspect the overall condition of the home and estimate the cost of repair. Take pictures.
3. Formulate their "opinion" of the property's value based on the information that was gathered.
4. Submit a detailed report of their research to the lender.