ORRA BrokerWise is e-mailed to ORRA's broker members every other month. It contains articles and resources suited to the specific interests of those who own and manage real estate brokerages.
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Highlight - from the October/November 2011 issue
BPO demand creates opportunity, but at a risk
Real-estate owned (REO) asset managers and lenders are now relying heavily on broker price opinions (BPOs) — produced by real estate offices — to place a value on their holdings and to set asking prices for both REO and short-sale properties.
From a risk management perspective BPOs are a time bomb of potential liability, whereas appraisals are safe and carry no potential liability for brokers. Brokers could be held liable for the accuracy and sufficiency of their BPOs to the same extent that financial institutions and mortgage companies are held liable for "robo-signing.” This is the kind of liability that can cost a broker his or her business.