A BPO is an acronym for Broker Price Opinion. A BPO is a form of appraisal review required by certain lenders when they feel that the value of your home is less than that which the appraiser has returned, or when there are significant discrepancies in square footage or other vital statistics between the appraisal and public record information about your property.

A BPO is used when a shortsale is in progress the lender will usually order a BPO to check the value of the home. There are two types of BPO'S
1. Is a drive by BPO where the appraiser just drives by and checks comps to estimate the value of the home and
2. Is an interior BPO where the appraiser inspects the whole house inside and out, and checks comps, to determine the value of the house.

The usage of non-full appraisals does have benefits, which is why lenders developed guidelines for reviewing an originator's use of AVMs, drive-by appraisals and broker price opinions (BPOs) as a sole valuation tool for first lien originations.

A BPO / Broker Price Opinion is relatively inexpensive by comparison to an appraisal, because unlike an appraisal, it is conducted by a real estate agent, who will either drive by your home or in some cases come into the home to take pictures. Sometimes you may be required to bear the cost of the BPO, and sometimes it will be borne by the lender.

A BPO is generally required for a Hard Money Loan.
The reason being that a BPO gives a real estate agent's opinion on how much the property would sell for in a quick sale.

 

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