Some real estate agents profits in the U.S. housing bust: Buy low, sell fast. Lenders are persuaded to approve the sale of homes for less than the balance owed -- known as a short sale -- without disclosing that there were better offers. Then the houses are flipped for a profit. The Federal Bureau of Investigation, the California Department of Real Estate and mortgage finance company Freddie Mac have warned that such schemes may be spreading after a plunge in values left homeowners owing more than their properties are worth. The scams threaten to deepen losses for lenders that are increasingly agreeing to short sales as an alternative to more costly foreclosures. The government, through its Home Affordable Foreclosure Alternatives Program, that month began offering as much as $1,500 to servicers, $2,000 to investors and $3,000 to homeowners who close short sales. “It appears that the program may lack necessary antifraud protections,” wrote Neil Barofsky, special inspector general for the Troubled Asset Relief Program in an April 20 report to the Congress. Dean Edelson, owner of Elysium Investment Group Inc. in Sedona, Arizona said efforts to influence broker price opinions, or BPOs, are needed to counterbalance lender pressure to inflate values. Brokers often form an opinion based on a street view of a home, unaware of hidden flaws, he said. Attempting to influence their opinion is legal as long as there is no pressure or payment to get a desired outcome, according to Edelson.
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