bpo

Definition

Broker Price Opinion—a real estate professional's estimate of a property's value, essentially an appraisal's less expensive, slightly less official cousin who still gets invited to family gatherings.

Example Usage

The bank ordered a BPO instead of a full appraisal to save costs on the foreclosure property.

Origin

Developed in the 1990s as a cost-effective alternative to formal appraisals

Fun Fact

BPOs typically cost $50-150 versus $300-500 for appraisals, making them popular with lenders dealing with distressed properties in bulk.

Source: Appraisal Institute professional standards documentation

Related Terms

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contingent financing clause

A contract provision allowing buyers to back out if they can't secure a loan, essentially making the deal conditional on a bank's approval. It's the escape hatch that makes sellers nervous and buyers sleep better at night.

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PITI

The four horsemen of monthly housing payments: Principal, Interest, Taxes, and Insurance. It's the total amount you'll shell out each month to keep a roof over your head and the bank off your back.

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PMI

Private Mortgage Insurance—extra insurance you pay when your down payment is less than 20%, protecting the lender if you default. It's insurance that only benefits the bank while you foot the bill.

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Advanced

net rentable area

The actual square footage tenants can occupy and must pay for, excluding common areas, mechanical rooms, and structural elements. It's why your 'thousand square foot' office feels like eight hundred.

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Intermediate

alligator property

An investment property with carrying costs that exceed the rental income, effectively eating the owner alive month by month. Named because it takes bigger and bigger bites out of your bank account.

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Advanced

subject to

Buying property while leaving the existing mortgage in place under the original borrower's name. It's legally questionable, financially risky, and somehow still happens regularly.

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