A Florida broker receives a request from a mortgage company to prepare a Broker Price Opinion (BPO) for a property in default. The mortgage company offers to pay $75 for the BPO and requests it be completed within 24 hours. The broker has never seen the property but has access to MLS data. What is the most appropriate action?
Correct Answer
B) Accept the assignment but request additional time to physically inspect the property
Correct: B - Accept the assignment but request additional time to physically inspect the property. A proper BPO requires physical inspection of the property to provide an accurate opinion of value, and the broker should request adequate time to perform due diligence. Why not A: This option is incorrect because "Complete the BPO using only MLS data since time is limited" does not match the rule tested by the question. The correct answer is "Accept the assignment but request additional time to physically inspect the property". A proper BPO requires physical inspection of the property to provide an accurate opinion of value, and the broker should request adequate time to perform due diligence. Why not C: This option is incorrect because "Decline the assignment due to the low fee amount" does not match the rule tested by the question. The correct answer is "Accept the assignment but request additional time to physically inspect the property". A proper BPO requires physical inspection of the property to provide an accurate opinion of value, and the broker should request adequate time to perform due diligence. Why not D: This option is incorrect because "Have an unlicensed assistant complete the BPO under supervision" does not match the rule tested by the question. The correct answer is "Accept the assignment but request additional time to physically inspect the property". A proper BPO requires physical inspection of the property to provide an accurate opinion of value, and the broker should request adequate time to perform due diligence.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Highest and best use is an appraisal concept that identifies the most profitable, legally permitted, physically possible, and financially feasible use of a property. It is the foundation of all property valuation.
Homestead portability allows homeowners to transfer a portion of their accumulated homestead tax savings to a new homestead in the same state.
The income approach estimates a property's value based on the income it generates by converting net operating income into a value estimate using a capitalization rate. It is the preferred method for income-producing properties.
More Valuation Appraisal Questions
In Florida appraisal practice, the cost approach typically considers all of the following types of depreciation EXCEPT:
The income approach to value would typically NOT be the primary approach for which of the following Florida properties?
A Florida real estate broker is preparing a BPO for a lender client. During the property inspection, the broker discovers significant undisclosed damage that affects the property's value. The lender has indicated they need the BPO to show a value that supports their loan amount. What should the broker do?
A Sarasota shopping center has a gross leasable area of 75,000 square feet with an average rent of $18 per square foot annually. The vacancy rate is 8%, and operating expenses are $675,000 per year. Using a 9% capitalization rate, what is the indicated value?
In a Ocala transaction, a buyer wants the Florida rule on CMA versus BPO versus appraisal. Which statement is correct?
- → A Florida homeowner is porting the Save Our Homes (SOH) benefit from a previous homestead to a new one. The previous home had a just (market) value of $335,000 and an assessed value of $235,000 (a $100,000 SOH differential). The new home has a just (market) value of $425,000. Ignoring the $50,000 homestead exemption, what is the maximum assessed value of the new homestead in the first year after porting (upsizing case)?
- → A sales associate in Naples prepares a CMA that indicates a property value of $275,000. The seller insists on listing at $325,000, saying 'that's what I need to get out of it.' The seller threatens to find another agent if the sales associate won't agree to the higher price. What should the sales associate do?
- → When using the sales comparison approach in Florida, an appraiser would make adjustments for all of the following property characteristics EXCEPT:
- → An appraiser in Tallahassee is valuing a 1920s historic home that has been converted to professional offices near the state capitol. The property has historic designation restrictions on modifications. Which approach would likely require the most careful consideration of these restrictions?
- → A Florida broker receives a BPO request from an asset management company for a property that the broker's firm currently has listed for sale. The asset management company is working for the lender who holds the mortgage on the same property. What should the broker do?
- → In a Florida BPO support file, one comparable sold for $395,000. The comparable needs a +$12,000 adjustment for an inferior feature and a -$4,000 adjustment for a superior feature. What adjusted indication does that comparable produce?
- → A retail shopping center in Jacksonville is being appraised for refinancing purposes. The center was built in 1995 and has several anchor tenants with long-term leases, but the area has experienced significant demographic changes with declining household incomes. New competing retail developments have opened nearby, and the subject property's occupancy has dropped from 95% to 78% over the past three years. What valuation approach will likely be most challenging to apply reliably?
- → Under Florida real estate law, what disclaimer must be included when a licensee provides a CMA to a client?
- → A licensed appraiser in Sarasota is appraising a historic courthouse that the city plans to convert into a community center. The building is 80 years old, has architectural significance, and will not generate income. Which appraisal approach is most appropriate for this assignment?
- → A broker in Miami receives a request from a mortgage company to prepare a Broker Price Opinion (BPO) on a property in foreclosure. The broker has an active Florida real estate license and is familiar with the area. What should the broker do before accepting this assignment?
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