Ida,

A short sale and an REO are different. A short sale is where the seller owes more than they can sell the home for. An REO is a property that has been through the foreclosure process and is now being offered for sale by the bank.

A short sale does not necessarily mean that the property is in foreclosure. There are instances where the seller has to be relocated for work and is required to move and must sell. There are also instances where the seller is in pre-foreclosure and is attempting to sell their home before it is foreclosed.

In terms of the BPO (Broker Price Opinion), you can have your Realtor complete a Comparative Market Analysis for you so you have an understanding of the value of the homes in the area. This is completed as part of the BPO and is what the bank will use to evaluate the value of the home.

Good Luck!

Lisa Cartolano
Alain Pinel Realtors

Ida, The banks will not release their BPO, Broker Price Opinion. My recommendation is to have your agent do a comparative market analysis to determine the home’s value. Based on that value you and your agent decided on an offering price.

There is no mathematical formula to determine offering price for bank owned or other property.

Let us start with, "When does the property become a REO?" A REO is a bank owned property, so if your placing offers directly to a bank or a bank's agent, then it's a REO.

Now let us tackle, "how do we find out the BPO from my broker/agent?" You will not find that information out, the bank isn't going to release their pricing strategy to anyone, they are trying to sell the home, not give it away. Chances are your agent doesn't even know the BPO unless they did it themselves. Banks get BPO's from agents whom they have relationships with in that particular community. They pay these agents to go out and complete the BPO for their benefit, not for the benefit of a prospective buyer. Just because it's a bank your dealing with, don't think for a second that they don't have some idea about what the home is worth in the condition it's in. Don't assume that they aren't going to act and behave like any other seller who is trying to make as much as possible in as short a time as possible. If you get a good deal, great, good for you however, just because it's a bank doesn't mean they are wanting to give the property away, they still need to cover cost and if possible, make some money, it is a bank after all.

I'm not sure where you got your idea that of a percentage to offer, but many people seem to think there is a magic number to hit. If your agent runs comps, they are likely close to what the BPO was, because that is exactly what running comps is: a broker's price opinion. It sounds like a typical short sale: it's taking a long time.