This is a complex topic that will be hard to answer entirely here. Although dated, much of the information here is still relevant: Working with Modular Characters | Unreal Engine 4.27 Documentation
Additionally, MetaHumans can serve as an example of how a modular character could be setup - including using an ActorBP as the character.
Using Lyra as an example, you can see how this is put into practice in this Tech Talk: https://www.youtube.com/watch?v=Fj1zCsYydD8&t=1114s