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Is a BPO Better Than an Appraisal?

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When it comes to determining the value of a property, two common methods come into play — BPO vs. traditional property appraisal. While both serve the same essential function they have unique approaches and applications. If you are deciding between a BPO and an appraisal, read on to understand which option is superior, when and why.

Broker Price Opinion (BPO)

A realtor or broker typically conducts a BPO by evaluating a property’s worth based on factors such as comparable sales, current market conditions, and property conditions. For certain deals, like loan origination and property sales, traditional appraisals are frequently surpassed by BPOs in terms of speed and affordability.

Property Appraisal

By contrast, a property appraisal involves an in-depth assessment of the property conducted by a licensed appraiser. Interior and exterior inspection, research, and strict guidelines adherence are crucial. Appraisals are needed for various reasons, including mortgage underwriting, refinancing, and legal matters.

Which is Better?

The fact is, that it is the circumstances of the transaction that determine whether a BPO or an
appraisal is chosen. When it comes to appraisals, BPOs would come up short compared to a
full evaluation that offers additional depth and accuracy. However, appraisals require a lot of
resources and can hence be a longer and pricier process.

It is crucial to consider your requirements and valuation context when deciding between BPOs
and appraisals

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