BPO Falsification?
I’ve been working a preforeclosure short sale for a property with documented structural deficiencies. The dwelling is in a gated, clusterhome community. The subject ‘cluster’ is Plaintiff in a lawsuit against the builder.I submtted a complete, shortsale application several months ago. The lender conveniently misplaced the file which I see now as more a standard practice, than an exception to the rule. The market dropped, the buyer revised its offer, the contract was resubmitted, the PHUD1 revised, etc. Finally the lender agreed to order a BPO. After about 10 days I called to ask the lender about the BPO, and I was advised the BPO had already been performed. The BPO indicated a value about $100,000 more than the pending offer.
I explained a drive-by BPO wasn’t sufficient for this particular dwelling in light of the engineering problems, and an interior BPO would provide better information. I was told by the loss mit rep her records indicated the BPO was an interior BPO, and its indicated value would likely result in the rejection of the short sale offer.
I always emphasize to the agents I’m working with it is essential they accompany the BPO rep, point out defects, adverse market conditions, etc. and then hand them updated market data. That’s our best chance to influence the lenders’ perception of value. I want to be kep informed when the BPO is scheduled, so we can discuss what additional/supportive info should be handed to the BPO rep. I called the agent to find out why he hadn’t alterted me to the scheduled BPO appointment.
The agent claimed he was not contacted for access, nor did the sellers grant permission to anyone at anytime to perform an interior BPO. The subject property is in a gated community with limited access. A guard at the gate would first need telephone authorization from the owners before conferring permission to enter the community. No such permission was sought, or granted.
I called the lender, again, who stated it had the results of an interior BPO performed on January 4th, 2008, complete with interior photos.
I told the loss mit I had no doubt her records confirmed a BPO had been performed, but her infomration was faulty. It must be a mistake. I suggested the vendor must have inserted the property info incorrectly, because there had been no BPO performed. She said she would investigate and get back to me. Of course, she never did get back to me. I sent several emails and FAXes, and left messages asking for the results of her investigation.
Today, after waiting on hold for about 15 minutes, I was able to speak to another loss mit rep who listened to my allegation of BPO falsification… a subject which should be of interest to all mortgage loan servicers.
The records indicated a rush interior BPO was ordered from the vendor on 1-4-08. Apparently, the BPO was performed by the vendor on 1-4-08. Talk about fast service!
I suggested, diplomatically, the vendor most likely assumed the unit was like any other unit in the community, and provided generic photographs from its archives while claiming it had performed an interior BPO. In the BPO report, there was no mention of the engineering/structural problems, no pictures of sagging beams or rafters, or settling foundations. There was no mention of the pending lawsuit, and no mention the listing agent had provided details of the structural problems verbatim from the Plaintiff’s summons and complaint.
In short, it seems the BPO vendor falsified information, and then billed for a service it had not performed.