BPO stands for Brokerâ€™s Price Opinion and is synonymous with appraisal of the property in question. Lenders that are being shorted rely on BPOs to determine market value of their collateral asset to make sure that it is being sold for a fair price rather than given away to a buyer.
Usually, the lender will request a BPO from a third party provider who then will assign a local realtor to provide a current market analysis for the home along with pictures and commentary. Increasingly, lenders started requiring full appraisals to be completed by licensed appraisals in order to make sure that they have the most precise valuation of a distressed property.
Appraisal, as compared to a BPO, goes into more detail on the features and condition of the property and requires more time to complete. BPO serves as one of the more important points of a short sale process. Unfortunately, many real estate agents who list short sales do not view it as such. Contrary to popular belief, a BPO is fairly subjective and can make or break a short sale transaction.