Home Buying in Santa Clara>Question Details

Babuyer, Home Buyer in San Jose, CA

BPO & Offer price

Asked by Babuyer, San Jose, CA Thu Jan 27, 2011

If the BPO is $740k, how much we should offer?

Help the community by answering this question:


Have your realtor show you the comparable sold homes and the time on the market. If that information is significantly different than the BPO value then you should have a case to argue for a lower price. I'm doing exactly that right now with one of my short sale listings as the comps justify a lower price than the BPO. A BPO is still just one person's opinion of value and many times that person does not even work int he particular area of the subject property and may not know the local market that well.
1 vote Thank Flag Link Thu Jan 27, 2011
$740K. Banks rarely sell for much less than fair market value, especially in markets are in tough shape as yours.
1 vote Thank Flag Link Thu Jan 27, 2011

You should offer whatever it takes to get the house!!

We've been knocked out of a couple offers with multiple offers well above ours!

What does your Broker advise?

0 votes Thank Flag Link Tue Feb 15, 2011
You should have your Buyer agent assist you with the current market value of the home. Then you determine what price you would want to offer. The BPO is what the Bank believes is the current value and they will decide what their bottom line is.
Web Reference: http://terrivellios.com
0 votes Thank Flag Link Fri Jan 28, 2011
Hi Babuyer:

Check recent comparables in Santa Clara.
Is this a recent BPO or an old one being confirmed by a listing agent from 6 months ago?
The market has moved up.

If it is a current BPO then a bank is unlikely to take less than $740K, if the home needs
work, then an offer with inspections need to be forwarded to an Asset Manager to review.

An asset manager does not know it needs work, unless the seller or the listing agent has
done inspections. If you are at BPO, and a Short Sale clearly the seller has no funds to
do inspections, so that you can get a reduced price home.

Do inspect and turn in a proper offer with inspections by working with your agent.
Due diligence is required, or buy it after it forecloses.

Homes on Julie Ct and Davis St. are just great.

Good luck.
Web Reference: http://www.ruthandperry.com
0 votes Thank Flag Link Fri Jan 28, 2011
Thank you for your inputs. A nearby house sold for $860 but it spent $150k for remodeling. This house needs a lot of works.
0 votes Thank Flag Link Fri Jan 28, 2011
BPO price and what the bank is willing to accept may be very different numbers. If the bank is holding a glut of properties in an area, often times they are willing to negotiate in order to move properties. Remember, banks are in the lending business not the real estate portfolio business. So don't be afraid to be aggressive.
0 votes Thank Flag Link Fri Jan 28, 2011

A BPO is just that....it's a broker price OPINION. These opinion are subject to be challenged, provided you have accurate information that further clarifies the subject home's value.

The amount you should offer should not be a random amount based on some magical percentage but concrete factual information that is documented and available. We have challenged and had met with success in changing the BPO. It's all a matter of investigating the records and presenting it in a manner that is understandable.

Always present an offer that you can also provide the records to substantiate.....it may make the difference you are looking for.

Good luck,

0 votes Thank Flag Link Fri Jan 28, 2011
Who cares what the BPO says ! That BPO could have been performed months ago and by whom ? The best approach is to have the agent who is writing your offer run the most recent MLS sold comparables within .5 mile of the subject property. That should have already been done for you anyways if you are at the point of making an offer.
0 votes Thank Flag Link Fri Jan 28, 2011
What does your agent come up with in their BPO? A BPO is no more accurate than what I or 10 other agents do in a comparative market analysis. When I submit an offer for a short sale, I submit my own analysis to justify our offer.
I offer in the low range of where I think it could go if it wasn't a short sale. Waiting for lenders to decide knowing that they may reject the offer of even foreclose while we are waiting has to be worth something to a patient buyer.
I suggest you have your agent do their own CMA and you decide a strategy together for your offer.
0 votes Thank Flag Link Fri Jan 28, 2011
Is this a short sale? Lenders will order BPO's to give them an idea of what the market value is on the property. Keep in mind lenders want fair market value on short sales. If the comps are there, and you want the house then offer the 740. Good luck
0 votes Thank Flag Link Thu Jan 27, 2011
Hello Babuyer:

Before we can answer this question, please tell me, has your offer been accepted by the seller? Are you in contract and now the bank has completed its BPO, obtaining a price for $740,000? Or are you considering the purchase of a short sale home, and the listing agent is telling you that the bank's BPO (which it probably had requested for a previous buyer) is $740,000?

Most importantly, while we can all conjecture what to do next, your best and most accurate answer will come from your real estate agent. Since you're considering a short sale, if you do not already have an agent, I would very very very strongly suggest that you get one to help you in your short sale, and for your own protection, I would advise that you not use the listing agent as your short sale agent.

Talk to your agent to review the comparables for your area. If you're already in contract to buy a short sale home and the bank is asking for $740,000--at least here in Santa Clara County, you have only two choices: 1) agree to the new price or 2) decline the price and cancel the contract. Banks are not negotiating on pricing here in the valley since there is usually other buyers for the property.

Good luck and please get an agent or consult your agent for help!

Grace Morioka, SRES
Area Pro Realty
Tel (408) 426-1616
Listings at 1.5% of sale price, rebates to buyers!
0 votes Thank Flag Link Thu Jan 27, 2011
Your area is very competitive right now. If there are other buyers placing offers on the home and it's a home that you really want then you will need to price your offer close to the BPO amount. There are ways that agents can find out if there are other competing buyers, hopefully you are using a buyers agent that can assist you with this.
0 votes Thank Flag Link Thu Jan 27, 2011
BPOs, while they are often relied upon by the lender/ REO company, are not always indicative of a good or correct value for the buyer. Ask your agent for his/her advice, backed up with comps, and if you have concerns, you could even purchase your own independent opinion of value from a licensed appraiser.

I have had cases where the initial BPO was way higher than what any buyer in their right mind could or should pay. As time passed, the lender softened their position. In another case, the 1st BPO was challenged and a 2nd BPO legitimately came in 15% less than the inaccurate 1st BPO.
Web Reference: http://www.kimnoonan.com
0 votes Thank Flag Link Thu Jan 27, 2011
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