Opening dialog with prospective homeowner
Hi Sharon,
With your advise during the Short Sale class on Monday, I now have a couple of leads that I need to approach either via a phone call or door knock. What is an opening line to introduce myself?
These leads are from a teammember Realtor doing a BPO. Does this mean the homeowner is in preforeclosure?
Please Help
When a bank orders a BPO on an occupied property, it is because the homeowners are behind in the mortgage and the bank is considering foreclosure or has already started it. This is a great lead, because usually the foreclosure is not public record yet. A phone call is fine, however, you will most likely be leaving a message. Something like..."Hi, my name is Sharon and my company specializes in helping people with pending real estate problems find solutions. Please call me as soon as possible to discuss some solutions for your situation. My number is ######." If you go to their door, be sure to hand them a postcard or flyer or business card as you introduce yourself and say pretty much the same thing, except ask if now is a good time to discuss the solution or should you come back at 7? Don't ask a yes or no question once you are involved in a conversation either on the phone or in person. Good luck, Sharon
Hi Sharon,
Can you please elaborate a little bit on what the BPO is? What it stands for and why is it done?
Thanks,
Dmitry.
Yes, please define BPO and what they are about. Thanks!
wgheisler
A BPO..."Broker's Price Opinion". This is basically an appraisal done by a real estate agent. It costs 1/3 of the price of a certified appraisal, so banks like to use them to determine a possible sales price for the home in question. When a property goes into default or foreclosure, the foreclosing lender orders a BPO to see where the stand financially with this potential future REO (real estate owned).
When doing a short sale, the lender will order an appraisal or BPO (at their expense) after receiving your short sale offer. They do this so they can determine whether to accept or counter your offer. That is why it is imperative you meet the person doing the BPO at the property when they go. You simply tell the lender that you are the contact person and have the key to the home and they need to have the real estate agent call you to make the appointment for the BPO. Dwan and I hand a copy of the short sale package to the BPO person and explain the situation. This helps the short sale process to go more in our favor. We do not bribe the person! We simply explain the situation just like we did to the lender. A tip: when you first submit your short sale offer, sometimes the lender will say "this is so low, we already have an appraisal for more at $X". This means that a BPO was already done (but, it was only a "drive-by", meaning the agent only saw the outside of the home from his/her car). Your reply is "the appraiser couldn't have possibly seen the inside!" and the lender will say, "well no, it was a drive by"; you say, "well, you've got to see inside; it's a mess, etc.". Hope this novel explains it better.....thanks.....Sharon
Thanks Sharon, you explained it perfectly!
Sharon:
What if the home does not have anything wrong with it on the inside? It is a perfectly good house on the inside and out, and nothing can justify lowering the FMV? Will the lender still consider your low offer? How do you approach the appraiser doing the BPO then?
Should Bankruptcy ever be used to gain leverage over the lender?
Thank you for you help and support.
Graham
I'd like to hear the answers to Gwrights questions.
In my experience, Lenders would love for the defaulted Homeowner to enter into Bankruptcy. For the mortgagee, that means a fast track to getting payments again (Chapter 13) or the rights to the Property (Chapter 7).
The answer really depends upon the circumstances. By volunteering information about which you are not sure... you run the risk of stepping on your own foot.
When you aren't sure, it's better to say nothing, or deflect the conversation to something you are sure about.