What would this be called.....

7 Replies

When someone identifies a house that is either foreclosed on or in threat of being foreclosed on, buys that house, then turns right around and sells the home to a flipper for a small, but quick profit, say $5000?

If that makes sense to anyone, could you please point me in the direction where I can learn more about this process/business model?

Thanks

Originally posted by @Cal C. :
I call it whotailing (silent w). @Michaela G. Is probably right but I use that term to distinguish when someone actually owns the property besides the few minutes at a double closing.

I've been hearing this word whotailing the last 2-3 years. Been around probably longer, but from my understanding, the correct definition would be selling at a price higher than wholesale, but not quite retail. I do this quite often with properties that are not turnkey, but in good enough shape to sell to an end user on the MLS. I'll price them below comps and typically sell them quite fast.

I closed one 1-2 weeks ago. I purchased it for $54K. I put it on the market As-Is for $84,900 and got a full price offer within a few days. It was probably worth around $95K retail. I spent around $4K on termite clearance, some trash hauling and a few items on the home inspector's punch list that the seller was pitching a fit about. If I had wholesaled it, I might have pocketed $5K, but sold it fast below market and made around $20K on it. Best part is I didn't even pay cash for it as I pulled the money off a cash advance from a credit card.

What the OP posted is what I would call wholesaling, even though the wholesaler paid the money and got the deed.

I have done what I consider to be "whotailing" when I do a very light rehab and sell it to an owner-occupant.

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