When it comes to REI, and buying a home, in general, you'll probably hear both of these terms, as in this article.
Below are some of the items brokers typically evaluate when completing a BPO:
- Information about the home’s location, building type, and size.
- An overview of the local housing market and its current trends.
- Details about the home and its condition.
- An analysis of at least three comparable homes in the area that were recently sold and another three homes that are currently listed for sale.
- Information about the number of foreclosures in the neighborhood.
Pros and cons of choosing a BPO
- A BPO can be completed more quickly than an appraisal.
- BPOs usually cost less than appraisals.
- BPOs can be used in place of appraisals for borrower-initiated PMI cancellation requests, foreclosures, mortgage releases and short sales.
- BPOs aren’t as detailed or thorough as appraisals.
- BPOs can’t always be used as an alternative to an appraisal.
- State laws might further limit or even prohibit the use of BPOs.