CapRelo Blog

Using BVO in Government Relocation Programs

Posted by Chris Finckel on Tue, Aug 14, 2012

v--crs-kristins-blog_posts-blog_photos-sold-resized-600.jpgFor years, the Guaranteed Home Buyout program has been a great benefit for government employees. This type of program is a safety net in the event the employee can't sell their home on their own. The program features a guaranteed offer from a third party relocation company based on the average of two appraisals. Once the relocation company buys the home, the employee is relieved of the financial burden. The relocation company then invoices the government for a fee or percent of the acquisition price that covers the resale, carrying and closing costs on the sale including any potential loss.

Find out more about how to develop relocation polices in our free guide. 

When the real estate market declined, relocation companies found it necessary to increase their fees from an average of 18-21% to 27-36% to cover costs. As a result, the Guaranteed Home Buyout has frequently become too expensive for government agencies looking to reduce expenses. In order to offer a solid employee benefit with a lower cost, we often recommend that government agencies explore the Buyer Value Option (BVO) program commonly used by corporations.

Buyer Value Option (BVO) Program

BVO is a home sale program that guarantees a sale to the employee only when a buyer makes an acceptable offer on the property. The program requires strict adherence to the 11 key elements of a BVO program in order to create two arms-length transactions that are deemed a business expense and therefore can be excluded from income taxes.

Recently, some government agencies have adopted BVO programs. These programs stipulate that the employee market their home under the BVO program for a period of 30-90 days. To begin the marketing process, the employee is required to list their home at 105-110% of the average of two broker's market analyses. This helps increase the chance of a potential sale within the marketing period. If the home doesn't sell in the required marketing period, the program converts to a guaranteed buyout program and appraisals are ordered.

The advantage of the BVO program for the government is significantly reduced program costs. A typical BVO program fee is a percent of the property sale price and can range from 8-15%. This offers a significant savings to government agencies and allows them to continue offering home sale assistance at a much lower cost.

Free eBook:  A Guide to Developing  Relocation Policies

Topics: federal relocation, Guaranteed Home Buyout program, Buyer Value Option

CapRelo: Specialists in Government Relocation

Posted by Chris Finckel on Wed, Jul 20, 2011

What does it mean to select a relocation company that is approved by the General Services Administration?

The government has stringent requirements when it comes to selecting companies to assist with government relocation. Not every relocation management company has the expertise, moving and real estate industry relationships, or non-exclusive supply chain partners to manage a successful government relocation.

As a GSA-approved relocation management company, CapRelo specializes in moving:

  • Military personnel
  • Federal and state government officials
  • Federal and state government employees
  • Civil service employees

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The Importance of Pre-Move Counseling
One of the key facets to a successful government relocation is pre-move counseling. This includes:

  • Scouting trips for the relocating employee and his family to select the right home in the right area
  • Introducing the relocating employee and his family to local community groups, activities, church, etc.
  • Getting children established in a new school


Government Relocation and Real Estate Sales
Not surprisingly, another key facet to a successful move involves home sales and purchases. A GSA-approved relocation management company can help government employees work with recommended real estate agents and home stagers to ensure a quick sale of their existing home. At CapRelo, we can also help employees line up mortgage financing through recommended lenders.

Most importantly, CapRelo's account managers are available when relocating employees need us—to answer questions, solve problems, and act as a go-between for the relocating employee and service providers.

This customer service is what puts us at the top of the list for many government agencies as the GSA-approved relocation company of choice. Whether you're a government agency or the head of HR at a major corporation or a small-to-mid-size business, CapRelo believes in providing the same high level of service. Call us to find out more.

Topics: relocation management company, relocating employees, federal relocation, pre-move counseling

Understanding Federal Relocation Benefits

Posted by Chris Finckel on Wed, Jul 13, 2011

Unlike private and publicly-held companies, the federal government has specific regulations and standards when it comes to relocating employees. Exceptions to federal relocation policies are extremely rare and require going through lots of red tape. This makes relocating civil service employees more of a challenge.

Most federal employees are under a contract that may preclude them from refusing a move or leaving their job position after a move. This means that maintaining morale is a serious consideration; a low-stress relocation can help federal employees return to full productivity faster and feel good about the move.

Federal relocation benefits

As challenging as it may be, (and here at CapRelo, we love meeting the challenge!) federal relocation is very similar to corporate relocation in some ways. For instance, federal relocation benefits fall under one of five categories.

  • Relocation Incentives: Employees can receive relocation incentives equal to as much as 25% of their annual salary and, in some cases, an additional incentive of up to 50% of their salary.
  • Transportation of people, vehicles and household goods: This also includes a per diem for hotel stays and meals along the route.
  • Rental transportation: Employees are entitled to a small stipend for a rental car during a move
  • Real Estate Assistance: Through a GSA-approved relocation management company, the employee receives home sale and purchase assistance.
  • Pre-move counseling: This crucial aspect in a successful federal relocation includes scouting trips to the new location, assistance in getting children established in new schools, and introducing the federal employee and his family to the new community.

Federal and Corporate Relocations: You Can Trust CapRelo

As you can see, federal and corporate relocations are not that different when it comes to doing what it takes to make relocating employees happy.

 

Download The Low-Stress  Relocation Guide
CapRelo has the industry connections through our non-exclusive supply chain to provide these services within an organization's relocation budget. That's why several departments of the federal government rely on us to provide relocation services to its top employees. Just imagine what we can do for you to create a low-stress relocation process that keeps your company going through a move.

Topics: federal relocation, relocation benefits, Low-Stress Relocation, Corporate Relocation Costs, corporate relocation program, Relocation Services, relocating employees

Government Relocation Assistance: What Does It Mean to Be A GSA Schedule 48 Supplier?

Posted by Chris Finckel on Thu, May 05, 2011

CapRelo is a GSA Schedule 48 supplier for federal government relocation services, which means we are approved to offer government relocation assistance under the General Services Administration program.

This program permits federal offices and services to offer many of the same relocation benefits and reimbursements to government employees that corporations often offer to their employees.  

For instance, our Buyer Value Option program provides the tax advantages of a home sale program with reduced costs compared to guaranteed buy-out programs. Other services we offer in regard to government relocation assistance include: 

Relocation Software, Technology Tools and Services

Through CapViews, our web based software, government relocation managers have access to every aspect of each government employee relocation. We provide the means for tracking expenses, budgets, reimbursement schedules, along with the means to contact the relocation service providers assisting with the moves. 

 Move Management Services

CapRelo provides household goods move management services, including carrier selection, move counseling for the relocating employee, maintaining communication between the relocating employee and the household goods carrier, invoice auditing, and employee claims assistance. By acting as the primary interface and manager of this process, we make the physical move of the employee, his family, vehicles, pets and household goods as low-stress as possible.

Customized Government Relocation Assistance Services

We offer low-fee and no-fee service options for federal agencies to assist employees who may not be eligible for relocation benefits or have opted out of offered relocation programs. This may be especially critical for relocating employees who don't qualify for home sale services, but the sale of their home is a determining factor in the success of their move.
 
 

Topics: relocation benefits, federal relocation, move management services, executive relocation package, Home Selling and Purchase Assistance

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