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Noah B. Garcia, left, Danette Davis and Christian Glye review numbers with Kent Davis.
“You don’t partner up with just any- body,” Davis said. “There needs to be compatibility beyond the financial model, and that’s been a real key to our success.” Bates adds that, while they are both “really good salespeople,” he’s likely to be on the run when people want to talk, whereas Davis is a natural listener. “Kent, being a pastor, is with you. You just feel his undivided attention,” Bates said. “He is so good at focusing on people.” AWIN-WIN BUSINESS MODEL Equistream is the “ultimate wholesal- er,” bidding on lots of distressed prop- erties offered by banks from Hawaii to Puerto Rico. Davis and Bates buy more in warm weather—giving themselves more marketing time during a typical calendar year—bidding on as many as 6,000 homes in a month and winning
10 to 20 percent of those. First, they present the properties to around 200 in-house clients who buy wholesale, offering the properties at steep discounts for a modest markup. The rest of the properties go into the Buy Here Pay Here program, where about 20 to 30 percent are sold to local flippers and another portion go to clients who use the turnkey real estate solution. The rest are sold to families who will make the house their home through Equist- ream’s seller financing program. While Equistream is a servicing company, with deeds for sold properties going into the seller’s name, they con- tinue their support through marketing to buyers and offering owner financing. They service the note and make remind- er calls if anyone is late on a payment. The model includes risk because the homebuyer—whether buying directly
from Equistream or from an investor to whom Equistream sold the proper- ty—is from the lower income bracket, usually with a credit score below 600. But the end result benefits everybody. For example, for just over $5,000, Bates was able to buy a house in Louisville, Miss., with a caved-in floor, a bad roof and 6-foot-tall grass in the front yard. Where some saw a teardown, Bates saw opportunity. He found a buyer who worked in construction but had no money for a down payment. So Bates traded major clean-up for the down payment. “He got three boys and went there one weekend and cut ridiculously tall weeds that should have been cut with a chainsaw,” Bates said. “You should see what he’s done with that house now.” The buyer and his family, who were paying $350 in rent for a broken
22 | think realty magazine july :: august 2016
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