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#332304 - 03/23/10 02:26 PM anyone having banks send you comps after the fact?
sacbroker Offline
Member

Registered: 10/31/07
Posts: 330
Loc: Sacramento
So far this week I have had 3 orders come back to me asking, "why can't you use the following comps, can you see if you can use them?" then the comps are listed for me to review. These orders were done more than 5 weeks ago and were "sent back by the client." Of course the comps they suggested were much higher in value, they were also more than 6 months old and in much better condition than the subject which is why I didn't use them. Seems to me this is unethical, possibly illegal, and will make a great case for not allowing BPO's anymore.

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#332306 - 03/23/10 02:47 PM Re: anyone having banks send you comps after the fact? [Re: sacbroker]
Don Price (Pine) Offline
REO-BPO-R.E. Mod
Major Contributor

Registered: 03/12/08
Posts: 3332
Loc: Pinehurst, NC
What? Do you think every appraisal is accepted as originally turned - very naive if that is the case.

Trust me - appraisers get the same treatment too, so the mere fact the end user returned the order asking for different comps to be used - says nothing about the legitimacy of BPO use.

What appraisers do have that we don't is a standardized form, and software that helps put the appraisal together step by step, checks it against the standards, figures distances, plots them, checks flood zones, etc.

Boy I miss that part - this stuff about every company having a different form for every client - sucks.

We need standardization, standardized reports, guidelines, and no after the fact reviews, a chicken in every pot and a car in every driveway. smile

(OK - no reviews may be stretching it smile )
_________________________
Don Price
Pinehurst, NC

Pinehurst NC Real Estate | Fayetteville Real Estate | Blog | Join active|rain

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#332307 - 03/23/10 02:51 PM Re: anyone having banks send you comps after the fact? [Re: sacbroker]
Analog Man Offline
Major Contributor

Registered: 07/22/07
Posts: 2098
Loc: Tampa Bay
Don't be too quick to judge. What I mean is that your example has occurred to me twice within the past few months. Both priors where appraisals and not BPOs! I'll never forget the most recent. The subject was a 1/2 mile on the wrong side of the inner city neighborhood. The appraiser for whatever reason used comps on the other side of the tracks which support much higher values, yet still within a mile of the subject.

Did they tell you the prior report was a BPO? My two latest cases, I was told they were prior appraisals.
_________________________


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#332313 - 03/23/10 03:48 PM Re: anyone having banks send you comps after the fact? [Re: Analog Man]
PROUST2009 Offline
Member

Registered: 12/15/09
Posts: 86
Loc: Washington, D.C.
Just goes to show you an appraisal license is no guarantee of competence and high ethics. It was often inexperienced appraisers using the older comps in 2006, 2007 and 2008 that exposed the raw underbelly of the housing market about to regurgitate twenty years of appreciation.
_________________________
Nex Millennium Realty and Financial Services
Serving the Washington Metropolitan Area since 1985

http://readyforourhome.com/
http://www.examiner.com/x-30587-DC-Mortgage-Examiner

"...If it be now, 'tis not to come; if it be not to come, it will be now; if it be not now, yet it will come..." Hamlet: Act V, Scene V.

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#332342 - 03/23/10 05:56 PM Re: anyone having banks send you comps after the fact? [Re: PROUST2009]
Don Price (Pine) Offline
REO-BPO-R.E. Mod
Major Contributor

Registered: 03/12/08
Posts: 3332
Loc: Pinehurst, NC
Originally Posted By: PROUST2009
Just goes to show you an appraisal license is no guarantee of competence and high ethics. It was often inexperienced appraisers using the older comps in 2006, 2007 and 2008 that exposed the raw underbelly of the housing market about to regurgitate twenty years of appreciation.


Whoa there - I don't think anyone indicated all of that, or any of that. You kind of read stuff between the lines the authors didn't intend to be there - lol
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Don Price
Pinehurst, NC

Pinehurst NC Real Estate | Fayetteville Real Estate | Blog | Join active|rain

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#332347 - 03/23/10 06:11 PM Re: anyone having banks send you comps after the fact? [Re: Don Price (Pine)]
sacbroker Offline
Member

Registered: 10/31/07
Posts: 330
Loc: Sacramento
I never even mentioned the word appraiser. This was all BPO's.

My two cents though- a real estate broker usually has a much better understanding of the true value of a property. Think about it, its what we do, sell these properties! Thanks Pine appreciate you having my back!

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#332396 - 03/23/10 11:39 PM Re: anyone having banks send you comps after the fact? [Re: sacbroker]
ohiorob Offline
Member

Registered: 02/07/09
Posts: 15
Loc: Ohio
If you're getting the request after the fact, the listing agent may be disputing your bpo value. It could be blocking their sale from happening - and they are coming back to the AMC with their own comps, which the AMC is forwarding on to you.

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#332548 - 03/24/10 04:51 PM Re: anyone having banks send you comps after the fact? [Re: ohiorob]
OverTheEdge Offline
Veteran Member

Registered: 08/24/08
Posts: 1027
Loc: Middle of Ohio
Let's break this into little tiny bits of info - your value is being disputed because it is too low - at least based on the comps that they sent to you - they are asking you to re-do the BPO using those comps - from this we know two things - They want the property to be valued higher and they are giving weight to your BPO which is why they want you to change it. What situation (reo listing, short sale, mortgage reset, insane reo company) needs a higher price supported by the BPO? Thoughts?
_________________________
"No cause is lost as long as there is one fool left to pursue it". Wil Turner

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#333013 - 03/28/10 03:37 AM Re: anyone having banks send you comps after the fact? [Re: OverTheEdge]
CanDo Offline
Major Contributor

Registered: 06/16/07
Posts: 2062
Loc: Northern California
I had a situation, just this week, that made me want to pull my hair out - strand by strand!

This is for a listing. Property is on the lower side of average to fair condition but it's GLA is in dispute. Assessor records indicate one thing and prior MLS (and when sold MLS) indicate another. It is clear looking at the property that it is larger than what the Assessor states.

Due to GLA it was not possible to find any other comparables within 350 sq. ft. of Subject's last reported GLA; it is an anomoly in its market segment. Did I mention it's in fair to average condition and older construction to boot.

AM wants higher value, no can do. Send CMA/MLS listings for entire area; expand search to include 1 year period. Appraisal (which had already been ordered prior to completion of BPO) comes out and measures and throws another 299 sq. ft. on to GLA. Appraisal comes in way under our value - this is where I start to pull/pluck my hair out, strand by strand.

AM provides the comps utilized by the Appraiser - what did the fool use? Comps that were 50% under his/her measured GLA!!!! 50%, of course, the values would be lower.

Would I mind revising my BPO lower (after asking that it be higher before I supplied the comp info)? Try though I may I couldn't do it without making huge price adjustments (in the $50,000 to $65,000 range) which I did and documented.

Upshot? They've ordered a 2nd BPO.

Pass the tequila.

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#333015 - 03/28/10 04:13 AM Re: anyone having banks send you comps after the fact? [Re: CanDo]
LizL Offline
Major Contributor

Registered: 08/27/05
Posts: 1795
Loc: Missouri
Oh, please tell us who, CanDo!! I'm betting SS.
_________________________
Broker/Owner, REALTORŪ,GRI, ABR
REO listing/selling since 2004; BPOs only for current clients

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#333035 - 03/28/10 11:54 AM Re: anyone having banks send you comps after the fact? [Re: LizL]
neudot Offline
Major Contributor

Registered: 11/02/07
Posts: 1960
Loc: Central New York
I've had this happen a few times in the past...not SS...basically they give me a list of comps they located somehow and asked me if any of them would be appropriate comps for the subject? I've gone through their suggestions, checking each one, and then tell them why the comps they suggested are or are not appropriate comps (usually not), due to age, style, condition or whatever. And then I've usually stood my ground on the comps I've used and the value I've determined.

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#333036 - 03/28/10 12:22 PM Re: anyone having banks send you comps after the fact? [Re: neudot]
philliams1772 Offline
Member

Registered: 03/21/10
Posts: 46
Loc: United States
I've had the same thing occur as neudot has. It's usually with the Fannie and Freddie work and it's only one particular company. The request is most often triggered by a difference of 10% or more in my value versus a BPO that was completed 5-6 months prior. I review the three sold comps from the prior report and explain whether or not the old comps are comparable to the subject. In addition, I explain why my comps are more relevant and comparable.
It's actually kind of interesting to see how two people who work in the same market doing the same thing can have disparate views on the same house and market conditions. More often than not, the old BPO grossly overvalues the property and minimizes the impact of the declining market conditions.


Edited by philliams1772 (03/28/10 12:23 PM)

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#333039 - 03/28/10 01:17 PM Re: anyone having banks send you comps after the fact? [Re: philliams1772]
Vermont Offline
Major Contributor

Registered: 04/12/08
Posts: 7950
Loc: Vermont's North-East Kingdom
This reminds me of a BPO I reluctantly agreed to do a few weeks ago. I knew going in it would be problematic. The Subject was:

Seasonal (usable only in the Summer Months);
LakeFront (on a Pristine 1700 Acre Lake 317' Deep);
Tiny (550 SF GLA); and
Condominiumized with 6 other Summer Cottages. (No land, beach, dock, well, sewer, driveway, or beach under its own control, and very limited PRIVACY).

I explained to the Coordinator that there aren't going to be many LakeFront Cottages that have Sold recently; fewer that are this Small, and almost none that have been Condominiumized.

She says "Well, If they don't exist, you'll just have to tell them!"

How quickly we forget!

Surprisingly, I found HOA Comps and one Condo Comp for some Seasonal Cottages within a 30 miles radius. I thought I had put this one to bed . . . . without too much fuss. I was wrong. They're still too accustomed to dealing with Cookie-Cutter Properties.

Ten (10) days after I submitted my report, out comes the rejection saying I'm too far away from the prior (-$75,000); which commenced a back and forth volley about the Comps that were chosen by the prior (May, 2009); whose name appeared on the report they wanted me to critique.

Unfortunately, he had simply used Year Round Residences, with full foundations set below the frost line . . . . heated dwellings that people live in Year Round. The Seasonal Subject is built on piers, with air space between it and the ground. It "Floats" with the movement of the frost line. It is not winterized, and has no thermostatically controlled heat. It has no running water in the winter, nor reliable sewage disposal.

He completely neglected to mention that the Subject had been condominiumized. He probably did not do any research to determine the manner in which the property was Deeded. Not one of his Comps appears to be in a HOA or organized under a Declaration of Condominium. They all OWN the land that they sit on. The Subject has no land of its own, and NO BEACH! The 1.1 Acres is held entirely in Common with the other 6 Condo Owners. The Owner is not free to do whatever he wants with the land, nor can he tear down and rebuild or expand his dwelling. And he is missing a considerable amount of privacy.

That should explain why there just might be a sizeable difference between the values of a Seasonal Waterfront Condo Cottage and a Detached Single Family Residence on its own land that happens to be on a shoreline.

I'm sorry for doing a little vent here; but I had explained this BEFORE I had even agreed to take on the Assignment. You can't get away with just just saying that Comps don't exist. You have to write a tome defining what constitutes a "condominium" and what does "seasonal" mean? This week I'll probably have to tell them what means "LakeFront" ?
_________________________
Dale C. Hittle of GOLDEN RULE PROPERTIES in Glover, Vermont
Where We're Always Striving To Put Together "THE FAIR DEAL"

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#333043 - 03/28/10 01:45 PM Re: anyone having banks send you comps after the fact? [Re: sacbroker]
Traveler Offline
Major Contributor

Registered: 11/14/00
Posts: 2500
Loc: The Coast
I don't think the banks are doing this as much now as before the crash. Although with the new mark-to-fantasy accounting rules it could still exist to a degree. I find it amusing to view other peoples comps though.

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