***Guest Appearance
Credits to:
https://www.youtube.com/@CommercialRealEstateProNetwork
“Raising Private Money with Jay Conner – CRE PN #481”
https://www.youtube.com/watch?v=MrWWFWU5eGs
Are you a real estate investor struggling to secure funding for your deals? Maybe the banks have gotten a little too picky with their lending criteria, or perhaps you’re just tired of jumping through endless hoops for a loan. Jay Conner, affectionately known as “The Private Money Authority,” has walked this road and came out on the other side with a strategy anyone in real estate can leverage: raising private money.
Jay Conner once again joined Darrin Gross on the CREPN Radio podcast, Jay shared his story, a compelling blend of humble beginnings, tough pivots, and the ability to turn problems into powerful opportunities.
From Bank Roadblocks to Opportunity
Jay’s journey in real estate began like many others: he visited the local bank, applied for funding, and went through the usual song and dance of credit checks, financial statements, and asset reviews. For several years, this status quo worked fine. But in 2009, everything changed. Without warning, his line of credit was closed, leaving him with two properties under contract and nowhere to turn. As Jay recalls, “Desperation has a smell to it. I had a problem, not an opportunity.”
Faced with a true financial crisis (not just another “opportunity in disguise” quote people love to share), Jay leaned into his relationships and asked, “Who do I know that can help me solve this problem?” That question led him to a colleague who introduced him to the concept of private money and self-directed IRAs, sparking a complete transformation in his approach to deal funding.
The Private Money Blueprint
Jay’s method is refreshingly straightforward and, perhaps most importantly, approachable for both seasoned and new investors. Rather than chasing after people and desperately pitching deals, Jay puts on his “teacher hat.” He focuses on educating potential private lenders—often people in his existing network or local community—about what private money is, how it works, and why it’s a win-win opportunity.
He explains, “Not one of my 47 private lenders had ever heard of private money or self-directed IRAs. I simply taught them.” By presenting a clear, safe, and attractive program to would-be lenders, Jay flips the script, positioning himself not as a beggar but as a provider of opportunity.
The three things lenders care about most?
- Attractive Return: Private lenders are often frustrated with the low interest rates on traditional vehicles like CDs. Jay offers up to 8% or 10%—well above what banks are paying.
- Security and Safety: Every loan is collateralized with a mortgage or deed of trust, up to 75% of after-repair value, giving substantial equity protection.
- No Volatility: Unlike the unpredictable stock market, lenders know exactly what their return will be for the life of the loan.
The No-Sell Approach
One point Jay hammered home was the importance of separating “raising money” from pitching specific deals. The worst time to ask for money is when you need it for a deal. By building the relationship and educating potential lenders ahead of time, when the right opportunity comes along, it’s not a hard sell—it’s just a “good news phone call:” “I have a deal ready for you, here’s the terms, here’s the timeline.” No pressure, no awkward conversations. Just a smooth transaction.
Mindset Matters
For those interested in starting their journey with private money, Jay stresses the importance of mindset. See yourself not as a borrower, but as someone leading with a servant’s heart, helping people get better returns safely. “Until you own the real estate between your ears, it’s going to be hard to own real estate in reality,” he notes.
Jay’s story is proof positive that private money isn’t just for big national players or those with the flashiest portfolios. If you’re willing to learn, educate, and lead with transparency and value, you can build a business that funds itself reliably, safely, and with far less stress.
Ready to Raise Your Own Private Money?
If you’re inspired, Jay recommends his free “Private Money Challenge,” a series of short videos guiding you through the process step by step at www.PrivateMoneyChallenge.com.
When banks say no, maybe it’s time you say yes to a better way of funding your real estate future.
10 Discussion Questions from this Episode:
- Jay Conner emphasizes the importance of “teaching” potential private lenders rather than asking them for money. How do you think this educational approach changes the dynamic between investor and lender?
- The transcript highlights that none of Jay’s 47 private lenders had ever heard of private money or self-directed IRAs before he educated them. Why do you think so few people are aware of these private lending opportunities, and how might wider awareness impact the real estate investing landscape?
- Jay talks about separating the process of securing private lenders from pitching specific deals to avoid appearing “desperate.” Why do you think this separation is important for building trust and credibility with lenders?
- According to Jay, there are three key things private lenders are looking for: a good return, safety/security, and no volatility. Which of these do you think is most important to the average private lender, and why?
- The conversation points out that success is a “lousy teacher” and that failure is where we learn the most. Can you share an example from your own experience where failure taught you more than success?
- Jay discusses using self-directed IRAs to invest in private lending opportunities. How can investors benefit from using self-directed IRAs, and what are some challenges or considerations to be aware of?
- The “good news phone call” script Jay shares is a practical tool for putting a lender’s money to work. How might having scripts or templates affect one’s confidence and professionalism in raising private money?
- Jay mentions that desperation “has a smell” in this business. Discuss some signs that might indicate desperation to a lender and strategies to avoid them.
- In the episode, Jay says he’s been paying his private lenders 8–10% since 2009, regardless of market fluctuations. What are the pros and cons for both the lender and the investor in offering a fixed interest rate over time?
- Jay’s Mastermind group and emphasis on networking with other investors are highlighted as key to growth. How important do you think community and peer learning are in real estate investing, especially in areas like raising private capital?
Fun facts that were revealed in the episode:
- Jay Conner Raised Over $2 Million in Less Than 90 Days Without Asking for Money
After being cut off by his bank in 2009, Jay learned about private money lending and was able to attract over $2 million in funding for his deals, without ever directly asking anyone for money. - Jay Has 47 Private Lenders—But None Had Ever Heard of Private Lending Before
All 47 of Jay’s current private lenders originally knew nothing about private money or self-directed IRAs. Jay simply taught people in his network about the opportunity, showing that education and sharing can be more powerful than a hard sell. - Jay Conner Lives in a Town of Only 8,000 People and Still Does Massive Deals
Despite being based in Morehead City, North Carolina—a small town of just 8,000 residents—Jay regularly completes real estate deals with average profits of around $82,000 per transaction, proving you don’t need to live in a big city to be successful in real estate investing.
Timestamps:
00:01 Insurance Offers & Private Money
05:56 Credit Crisis and Self-Help Strategy
07:25 Discovering Private Money Lending
12:17 Private Money Investment Strategy
16:29 Lenders’ Top 3 Investment Criteria
17:28 Consistent Private Lending Rates
20:29 Equity Cushion in Property Deals
24:49 Accrued Interest on IRA Loans
28:43 Mindset for Real Estate Success
31:29 Growth Risks: Complacency & Stagnation
34:48 Connect with Jay Conner:
https://www.PrivateMoneyChallenge.com
Connect With Jay Conner:
Private Money Academy Conference:
Free Report:
https://www.jayconner.com/MoneyReport
Join the Private Money Academy:
https://www.JayConner.com/trial/
Have you read Jay’s new book, Where to Get the Money Now?
It is available FREE (all you pay is the shipping and handling) at https://www.JayConner.com/Book
What is Private Money? Real Estate Investing with Jay Conner
http://www.JayConner.com/MoneyPodcast
Jay Conner is a proven real estate investment leader. Without using his own money or credit, Jay maximizes creative methods to buy and sell properties with profits averaging $67,000 per deal.
#RealEstate #RealEstateInvesting #RealEstateInvestingForBeginners #Foreclosures #FlippingHouses #PrivateMoney #RaisingPrivateMoney #JayConner
YouTube Channel
https://www.youtube.com/c/RealEstateInvestingWithJayConner
Apple Podcast:
Facebook:
https://www.facebook.com/jay.conner.marketing
Twitter:
https://twitter.com/JayConner01
Pinterest:
https://www.pinterest.com/JConner_PrivateMoneyAuthority
Raising Funds with Confidence: Why Private Lenders Flock to Jay Conner’s Program
Narrator [00:00:01]:
If you’re a real estate investor and are wondering how to raise and leverage private money to make more profit on every deal, then you’re in the right place for raising private money. We’ll speak with new and seasoned investors to dissect their deals and extract the best tips and strategies to help you get the money. Because the money comes first. Now, here’s your host, Jay Conner.
Jay Conner [00:00:28]:
What our private lenders love, particularly the older retired private lenders, what they love is that they know exactly what the rate of return is going to be. So if they loan me $100,000 on a deal, they know they’re going to earn, excuse me, if they loan me a hundred thousand, 8%, they’re going to earn $8,000 for that year. That’s an annual percentage rate, by the way. That’s not 8% for six months or ever. How long have I been doing the deal? That’s an annualized APR, annual percentage rate. So that’s what they love. They love a nice return. Very nice return.
Jay Conner [00:01:11]:
They love safety, they love security, and they love no volatility.
Narrator [00:01:17]:
Welcome to CREPN Radio for influential commercial real estate professionals who work with investors, buyers, and sellers of commercial real estate coast to coast. Whether you’re an investor, broker, lender, property manager, attorney, or accountant, we’re here to learn from the experts.
Darrin Gross [00:01:36]:
Welcome to Commercial Real Estate Pro Network, CREPN Radio. Thanks for joining us. My name is Jay Darren Gross. This is a podcast focused on commercial real estate investment and risk management strategies. Weekly, we have conversations with commercial real estate investors and professionals who provide their experience and insight to help you grow your real estate portfolio. Today’s interview is sponsored by Building Insurance and Risk. When you invest in real estate, it pays to work with a real estate investor protection specialist to protect yourself and your investment from catastrophic loss. The experts at Building Insurance and Risk focus on real estate investor protection.
Darrin Gross [00:02:17]:
They provide you with multiple insurance coverage offers and a side-by-side coverage comparison. To learn more, go to buildinginsurancerisk.com today. My guest is Jay Connor, the Private Money Authority. And in just a minute, we’re going to speak with Jay about raising private money. But first, a quick reminder. If you like our show, CREPN Radio, there are a couple of things you can do to help us out. You can like, share, and subscribe, and as always, we encourage you to leave a comment. We love to hear from our listeners. Also, if you want to see how handsome our guests are, be sure to check out our YouTube channel.
Darrin Gross [00:02:55]:
You can find us on YouTube. Commercial Real Estate Pro Network. And while you’re there, please subscribe with that. I want to welcome back Jay Connor to Crepn Radio.
Jay Conner [00:03:08]:
Darren, thank you so much for having me come back. I must have done an okay job the first time, or you wouldn’t have had me come back. But as always, I’m just so excited to talk about it. My favorite topic to talk about is private money. And the reason is that private money alone has changed and impacted our real estate investing business more than any other strategy in the history of us being in this business, which we’ve been full-time real estate investors since 2003. So, yes, private money, private lending, self-directed IRAs. I’m here to talk all about it, Darren.
Darrin Gross [00:03:48]:
All right, well, before we get going here, if you could do me a favor and just share with the listeners who haven’t heard you a little bit about your background.
Jay Conner [00:03:57]:
Sure. Well, my wife Carol Joy and I live here in eastern North Carolina in a very, very small town, Morehead City, population 8,000 people. Our total target market here in eastern North Carolina is only 40 40,000 people. And our focus these days and has been for a long time is single-family houses. However, I’ve done commercial developments as well. I’ve done a shopping center from the ground up. I’ve done two different condominium developments. And as far as private money goes, it’s all the same money.
Jay Conner [00:04:32]:
When you raise private money for your real estate deals, it’s just a matter of how you structure the deals. But, but anyway, how is it that I’m qualified to even talk about private money? Well, from 2003 when we started, till 2009, January 2009, the only thing I knew to do was go to the local to get my deals funded is go to the local bank, get on my hands and knees, put my hands underneath my chin and say, please fund my deal, Mrs. Banker or Mrs. Banker. And you know, I had to pull up my skirt and let them look at all my assets, and they give me a colonoscopy, and they pull my credit score, and want to look at my financial statements, and all this stuff. Well, that worked out okay. Okay. The first six years from 2003 to January 2009.
Jay Conner [00:05:21]:
And in January 2009, there had to be a pivot. I remember it like it was yesterday. I called up my banker, whose name was Steve. Steve. And I have been doing a lot of deals for those first six years. And I called up Steve, and I had two houses under contract to purchase. And I told him the funding that was required for those two deals, which was nothing new. I had this conversation with Steve many times, and I learned, Darren, right there on that phone call, that my line of credit had been closed with no notice.
Jay Conner [00:05:56]:
And I said to Steve, I said Steve, what in the world are you telling me my line of credit is closed? He said, Jay, don’t you know there’s a global financial crisis going on right now? And I said, no, but you just gave me a financial crisis. I don’t have a way to fund my deals now. And so I hung up the phone, Darren, and I sat here for a moment, and I thought to myself, what am I going to do now? By the way, I want to share with your audience right now a very powerful question that I ask myself. And his question that I’m going to share will help fix any problem anybody’s got going on at any time. I don’t care if it’s health, relationships, money, financial, career, it doesn’t matter. And here’s the question I asked myself. I said, Jay, who do you know that can help you with your problem? By the way, these people running around saying, every problem’s an opportunity. I want to throw up.
Jay Conner [00:06:53]:
I didn’t have an opportunity, I had a problem. Now, a problem can become an opportunity. But at that moment in time, let’s face reality. This is a problem. So when I asked myself, Jay, who do you know that can help you with your problem? I immediately thought of Jeff Blankenship, a very good friend. Carol Joy just saw, we just saw Jeff this past weekend at an a cappella gospel singing event, and his wife Megan and their kids. Anyway, this is back in 2009. I thought of Jeff as to whom I could help with my problem.
Jay Conner [00:07:25]:
Jeff was living in Greensboro, North Carolina, at the time, investing in real estate. So I called him up, and I told him what had happened. I got cut off from the bank. Jeff said, Well, Jay, welcome to the club. I said, What club is that? He says, My bank just cut me off last week. I said, Well, Jeff, how in the world are you going to fund your real estate deals? And he said, Well, have you ever heard of private money and private lending? And I said no. He said, have you ever heard about self directed IRAs and how individuals can use their retirement funds that they have and if they’re not happy with the returns, they can transfer those retirement funds over to a self directed IRA company, loan it out for high rates of return and earn either tax deferred or tax free income. I said, What in the world are you talking about.
Jay Conner [00:08:11]:
So anyway, I learned and studied private money, private lending. In less than 90 days, I was able to attract without ever asking anybody for money. That’s what’s funny, Darren. I’ve never asked anybody for money and funding, and I have eight and a half million dollars available to me. So anyway, I was able to raise 2,150,000 or less than 90 days without asking anybody for money. And since that time, I’ve never missed out on a deal for not having the funding. I’ve got a problem. There’s more money than there are deals, quite frankly, to be able to use.
Jay Conner [00:08:51]:
So anyway, that’s how we all got started in private money and private lending back in 2009 and haven’t slowed down since.
Darrin Gross [00:09:02]:
I love hearing the backstory, and kind of the how we got to here, and private money. We’ve talked a couple of times and, and I think the, you know, you laid it out pretty well that you know people with their 401ks and, and the ability to access that money and, and through self directed IRAs and that I want to ask you rather than like from the need standpoint or the, the you trying to raise money, want to ask you from the standpoint of the, the lender, the private money lender, what are they looking for? What did you find that piqued their interest when you first, the call you made and since then, what is it that they’re looking for?
Jay Conner [00:09:49]:
That’s a great question. So first of all, let me share this. We’ve got 47 private lenders right now and if you’re, and if you don’t have any private lenders, you don’t need 47; you just need a couple to get started. But anyway, what’s interesting, Darren, of these 47 private lenders that we have that are funding our deals, loaning us money on our real estate, not one of them, not one of them, had ever heard of private money and private lending. They didn’t know what it was. They never heard of self-directed IRAs. So, how did that come about? Well, well, you see the way that I attract private money from people that have never heard about it is I put on my teacher hat. I put on my teacher hat, and my teacher hat says private money teacher.
Jay Conner [00:10:39]:
And so I would just go about teaching people that I already have a connection with in my cell phone, you know, on my email list or whatever, people I go to church with, and I just started sharing with them what this world of private money is about. So what I did to begin with is I put my program together that I was going to teach. And, and you know, what interest rate am I going to offer, you know, private lenders? How can they get their money back in case of an emergency? What’s my maximum, you know, loan-to-value that I’m going to allow my private lenders to loan me? And so I went about teaching them in my market or, you know, my connections. And so that’s what makes it so beautiful. You see, I wasn’t trying to reach out to existing private lenders or people who had already loaned money out. I wanted to teach them this opportunity. You see, instead of asking for a mortgage, we’re offering an opportunity or a program.
Jay Conner [00:11:41]:
And I’ll tell you another big secret, Darren. I mean, I’ve never pitched a deal in my life. I’ve never pitched a deal. And the reason I haven’t had to pitch a deal is because I separate, and this is so critical, I separate my conversations with a new potential private lender from talking about a deal. You know, the worst time in the world to be trying to raise money is when you need it for a deal. And for goodness’ sake, here’s a quote. Desperation has a smell to it. Desperation has a smell to it.
Jay Conner [00:12:17]:
So if I’m talking, if I’m sharing with someone about this opportunity in this world of private money and I bring up a deal, in that initial conversation, I already sound desperate without even trying to sound desperate, because what they’re hearing is, oh, if I don’t fund your deal, you’re not going to be able to do a deal. So we teach the program, and they tell us how much they got to work with. Is it retirement funds? Do I need to introduce them to the self-directed IRA company and get their funds moved over so they’re all set to go? And then here’s the beautiful thing. When I’ve got a deal ready for them to fund, I don’t call them up and tell them about the deal and ask them do they want to do the deal? That’s the most stupid question in the world. I could ask them. Of course, they want to do the deal. And particularlf, if they have moved retirement funds over their retirement funds over to a self-directed IRA company, they’re not making any money until I put that money to work. So they are sitting by the phone waiting for what I call the good news phone call.
Jay Conner [00:13:24]:
So Darren, I want to share right now the script with your audience on how to get your deal funded without asking for money. So there’s the important part to realize. And remember, they’ve already told you they love the program, they love the interest rate. They love how you are going to protect them with a mortgage or deed of trust and maximum loan-to-value, et cetera. So here’s the script. I pick up the phone. Believe it or not, we still have phones with cords here in North Carolina. But anyway, I pick up the phone, I call up, and Darren, let’s say you’re.
Jay Conner [00:13:58]:
You’re one of my private lenders. And so I call you up, you answer the phone, and I say, Darren, I have great news. I can now put your money to work. I’ve got a house under contract in Newport after repairs, valued at $200,000. The funding required for the deal is $150,000. Of course, that matches what you told me you had that you wanted to invest in. Closing is going to be next Thursday, so you’ll need to have your funds wired to my real estate attorney’s trust account by next Wednesday. I’m going to have my real estate attorney email you the wiring instructions.
Jay Conner [00:14:34]:
End of conversation. I mean, like, as I said, I’m not going to ask you to do the deal. Of course, you want to do the deal. You’ve been waiting for the good news phone call when I told you I’d put your money to work for you just as soon as possible. And you know, one mistake that I have seen, that’s a thread with new fundraisers, real estate investors that are looking to raise capital, is that they talk too much. Right? If you talk too much, you sound like you’re chasing, begging, selling, or persuading. Right? Keep it simple. Keep it simple.
Jay Conner [00:15:08]:
Right back to you, Darren.
Darrin Gross [00:15:11]:
No, I love the keep it simple, stupid. That’s kind of one of the rules I try and live by. But, so, so again, with the, with the investor, you, you know, you’ve demonstrated that you don’t ask for money. It’s more of an opportunity. And the fact that I think I heard you say you don’t wait until you need the money to introduce this topic. You’ve had your teacher hat on and you’ve been kind of, you know, going around, or you’ve been speaking with prospective investors and they, they have. I. I want in.
Darrin Gross [00:15:47]:
I want in. I mean, so there’s a, There’s a sense of, of, I want to, I want to do that opportunity so that when, when you do call, they’re, you know, they’re ready to go. If we back up just a second here in the education process. What, what, is there a single thing or, or is it just the whole combination of things that appeals, that you find, that appeals most to it? Is it, is it a better interest rate than what they’re, they’re achieving through their current investments? Is there what is it that you’re finding that appeals to the investors to want to be a part of the opportunity?
Jay Conner [00:16:29]:
Yeah, there are three main things. There are three things that these private lenders are looking for, and they don’t even know they’re looking for it until you present the opportunity. But I’ll tell you what these three things are. First of all, is the interest rate, right? Making a lot more money than they are from having their money invested in, say, a certificate of deposit at the local bank, which, by the way, the rates right now are dropping fast. First Citizens Bank, right here in Morehead City, North Carolina, six months ago, you could get five and a quarter percent for seven months. Yesterday, four and a quarter, it dropped a whole percentage point in six months. And if you want to get a longer-term CD, then the interest rate is even lower than that. Why? Because the banks are anticipating interest rates coming down.
Jay Conner [00:17:28]:
So anyway, I’ve been paying my private lenders 8% or 10% ever since 2009. I pay them 8% for a first lien position loan, and then I’ll pay 10% for any junior liens. And I only use smaller amounts of money in the second position, you know, like rehab money, 30,000, 40,000, 50,000. And I don’t mind paying 10% on that, by the way. There are no origination fees, no origination fees ever, in this world of private money. So in first position, 8%. I’ve been paying them the same thing since 2009, when I started. And people, you know, over the other real estate investors over the last year or so, they’ll say, Jay, how in the world are you paying the same interest rate since you were in 2009? And interest rates are like going up, out of sight.
Jay Conner [00:18:22]:
How are you doing that? I said, well, it’s really simple. First of all, remember, we make the rules. We’re not applying for a mortgage. Hey, look, you’re already approved. You are already approved as the borrower. There’s no application process. So we make the rules, we set the interest rate, we set the terms. Secondly, even when you could get five and a quarter percent in the local bank six months ago, well, 8% and 10% are a whole lot more attractive than 5% or five and a quarter percent.
Jay Conner [00:18:55]:
Right. So the first thing they’re looking for is a very nice return. You see, we’re not joint venturing. They’re not getting any equity position. The private lender is the bank. Right? So it’s like them just putting their money in a certificate of deposit, and they know exactly what the rate of return is going to be. So that’s number one high, a nice high return. The second reason that they are interested and do business with us, and we’ll do business with you, who are listening here on the show, is that they want an investment.
Jay Conner [00:19:32]:
They want it secure and they want it safe. Secure and safe. So let’s break that down for a moment. We are not borrowing unsecured funds. You can legally, but for goodness’ sake, you don’t look after your private lenders. So in North Carolina, it’s a deed of trust. In most states, it’s a mortgage. It accomplishes the same thing.
Jay Conner [00:19:56]:
The mortgage or the deed of trust collateralizes the promissory note so that if you don’t pay them, the property does, and they can foreclose on you. Right. So that gives them security. Now it’s safe. How’s it safe? Well, our maximum loan to after-repair value is 75%. I did not say 75% of the purchase price. That’s, ‘s bank, that’s bank talk. I’m talking 75% of after after-repaired value.
Jay Conner [00:20:29]:
So that’s a conservative. So the lender is going to have what we call a 25% equity cushion, right? Which means they’re not going to loan more than 75%, or you’re not going to allow them to loan you. I mean, they don’t know what to do. Remember, you got your teacher hat on. You’re teaching them what this deal is, right? So you’re not going to allow them to loan you more than 75% of the after-repaired value. Now, just as a side note, this is why we get to always bring home a big check when we buy without taking any of your own money to the closing table. I mean, who wants to get paid to buy properties, right? So this formula works when you are buying at a substantial discount. Well, how are you buying a house at a substantial discount? Because it needs renovation, it needs rehabbing.
Jay Conner [00:21:23]:
That’s why you’re buying it at a substantial discount. So anyway, secure and safe. The third thing that these private lenders are looking for and what they love about the program is that there’s no volatility in the value of their investment. So obviously, what am I contrasting this opportunity to? I’m contrasting it to the stock market, mutual funds, and stocks. So if someone takes their money and invests in a stock or a mutual fund, first of all, they have already lost money. They had to pay commissions, they had to pay fees. Well, in this program, there are no commissions, and there are no fees.
Jay Conner [00:22:05]:
This is a direct transaction with no middle person involved, directly between you and the private lender. So what our private lenders love, particularly the older retired private lenders, what they love is that they know exactly what the rate of return is going to be. So if they loan me $100,000 on a deal, they know they’re going to earn, excuse me, if they loan me 100,000 at 8%, they’re going to earn $8,000 for that year. That’s an annual percentage rate, by the way. That’s not 8% for six months or ever. How long have I been doing the deal? That’s an annualized APR, annual percentage rate. So that’s what they love. They love a nice return, very nice return.
Jay Conner [00:22:56]:
They love safety, they love security, and they love no volatility.
Darrin Gross [00:23:04]:
So tell me, you, you’ve got the interest, you, you’ve done the teaching, you’ve got the investors ready for the call. They lend you the money. How frequently do you pay the interest? Is that upon, is it monthly, quarterly? Is it when the deals, when you’re done with it, how, how, what frequency do you pay the interest?
Jay Conner [00:23:34]:
Yeah, that’s a great question. I leave it up to the lender. Different lenders have different objectives. For example, some of our private lenders are retired, as I mentioned. They need the monthly income. They don’t want to touch their principal. They want to keep that out there. But to subsidize, to, you know, complement and go along with the other retirement income they have, they need it monthly.
Jay Conner [00:24:02]:
So for them, I’ll pay the interest monthly. By the way, side note, we do not pay principal and interest. We don’t do P and I. This is interest only, either being paid or accrued. That’s a win-win for all the parties. Interest only is a win for the lender because they make more money. If you’re paying principal and interest monthly payments, you’re paying part of their investment down. So they don’t earn as much money.
Jay Conner [00:24:31]:
It’s a win. Interest-only payments are a win for us, the borrower, because interest-only payments are smaller on cash flow than principal and interest. So that’s a win for everybody.
Darrin Gross [00:24:44]:
Right, so you do give the options as far as how, whatever they are. Yeah.
Jay Conner [00:24:49]:
So, like if I’m, if I look like I’m the in and out of a property, like pretty quickly, then we’ll just let the interest accrue and not make any payments, right? I mean, you know, particularly if it’s retirement funds, those payments would not be going back to them anyway. That would be going to their self-directed IRA. But so on self-directed IRA loans, I mean, they’re going to just let the interest accrue. Now let’s stop and think about that for a moment. On your cash flow, you take no money to the closing table of your own. You bring home a big check, and you don’t make any payments until you cash out. And then you cash out and pay off the private lender, their principal, and any unpaid accrued interest. But if they’re using their self-directed IRA retirement funds, I’m only going to pay that if I’m not letting it accrue.
Jay Conner [00:25:35]:
I’m only going to pay that either quarterly or semiannually. Now I’m not going to let it accrue. Like if I’m doing a, if I’m doing a buy and hold for a little while, like I’m renovating and then I’m going to refinance and cash out the private lender, then I’m not going to do annual interest payments. I don’t like them checks. Those are big checks. Ask me how I know. So we only do quarterly or semiannual interest payments.
Darrin Gross [00:26:02]:
Got it. You mentioned you’ve got more money available right now than deals to do. Is that, in that situation, are the, is there any interests you owe on the money, or is it just, you know, you, when you’re done with the deal, you pay back all the funds you borrowed, and they’re waiting for you to call again.
Jay Conner [00:26:28]:
Right. So I make sure we put the money to work. So if I don’t, if I’ve got more private money than I can use than the number of deals that I’m doing, which I average two to three deals a month. Average profits now are about $82,000 per deal per transaction. We do. And by the way, I don’t share that to brag, I share that to make a point. And that is, you don’t have to do that many deals a month to have a significant income, even in, you know, a small market. But I already forgot the question, Darren.
Jay Conner [00:27:01]:
What was the question?
Darrin Gross [00:27:02]:
Well, just the investors’ or the lenders’ capital.
Jay Conner [00:27:06]:
Oh, right, right, right. So I run a mastermind, and my Mastermind members are able to have access to and tap into my private lender’s funds as well. So we make sure we keep, we keep, the money invested and deployed because you know, if it’s sitting there, if you don’t use it, your private lender is going to find somewhere to put it.
Darrin Gross [00:27:33]:
Right, right, that’s, that’s good. And your Mastermind, how big of a group do you have as far as the?
Jay Conner [00:27:40]:
Yeah, right now we’ve got 3,738 members in the Mastermind. And, I also have another membership called Platinum Plus. There’s probably, it’s probably 4, probably 40 or 50 of those right now. But yeah, we have a great time. We were just together two weeks ago. They all come in here to Morehead City, Atlantic Beach, North Carolina, three times a year in person. And we go from 7:30 in the morning until 6:30 in the evening. And then we go eat good, we’ll do sunset sales, have dinner out on the water because we live here in a resort area, but we have a lot of fun.
Darrin Gross [00:28:25]:
Well, that’s great. So we’re somebody who’s listening right now who, their interest has been piqued, and they have the need that they’re trying to turn into an opportunity. What, what would you advise them on how to get started?
Jay Conner [00:28:43]:
Well, here’s how you get started. I’m going to answer it two different ways. First of all, you’ve got to get your mindset right. I tell people that until you own the real estate between your ears, it’s going to be hard to own real estate traditionally. Right. So what I mean by that is, remember, in this world of private money, you’re not asking, begging, chasing, persuading, trying to sell anybody. You’re leading with a servant’s heart. And I mean, you know, Carol, Joy, and I have received numerous handwritten notes over the years of how this program that we have offered people how it’s changed their lives, how it’s changed their retirement years.
Jay Conner [00:29:22]:
So you want to get the mindset straight first. In addition to that, how can they get started? Darren, I am so excited. I just recently launched my brand new Private Money Challenge. And what is the Private Money Challenge? Well, this is a series of seven videos, and they’re only about 15 to 20 minutes long. But the Private Money Challenge gives just a great foundation on how to raise a lot of money very, very quickly without ever having to ask for money. And I share my scripts, and exactly, you know what I say. So I invite your audience to go to www.private money challenge.com. Again, that’s www.private money challenge.com.
Jay Conner [00:30:10]:
And I promise you, you’re going to learn how to raise private money. And at the same time, we’re going to have a lot of fun together. I’ll be right there on the video with you, engaging with you. And I say, if you can’t have fun while you’re doing it, then don’t do it.
Darrin Gross [00:30:23]:
That’s great. Hey Jay, if we could, I’d like to shift gears here for a second. As I’ve mentioned before, by day, I’m an insurance broker and as such, I work with my clients to assess risk and to determine what to do with the risk. And there are three strategies we typically consider. We first look to see if there’s a way we can avoid the risk. When that’s not an option, we look to see if there’s a way we can minimize the risk. And if we’re unable to avoid or minimize the risk, we look to see if we can transfer the risk. And that’s what an insurance policy is.
Darrin Gross [00:30:56]:
It’s a risk transfer vehicle. And as such, I like to ask my guests if they can look at their situation. It could be the Fed, the political climate, interest rates, whatever it is that you identify and consider to be the biggest risk. And again, for clarification, while I’m an insurance broker, I’m not necessarily looking for an insurance-related answer. And so if you’re willing, I’d like to ask you, Jay Connor, what is the biggest risk?
Jay Conner [00:31:29]:
Well, when you ask that question, Darren, the first answer that comes to my mind is not a traditional answer. I’m thinking about Charlie Jones. Charlie Jones is known for his quote that says, Within the next five years, two things will have the biggest impact on your growth within the next five years. Those are the new people you meet and the new books you read. So my answer to the question, what do I see as the biggest risk? The biggest risk I see is someone being happy with the copacetic and ecstatic and missing out on all the opportunities that this world has to offer and that God has to offer. And how you can learn about these opportunities is what Charlie Jones says. The people you meet and the books you read. My good friend Tom Crowell, who was the founder of Wholesaling Inc.
Jay Conner [00:32:33]:
Which was the largest wholesaling instruction company in the nation? Tom preaches to read a page a day, just read eight pages a day of a nonfiction book, autobiographies, biographies, or self-improvement, do. Commit to that and join very reputable networking groups or masterminds, people with like-minded goals. So the biggest risk that I see, Darren, is people missing out on all that there is out there to be offered by staying static and not embracing and being committed to self-growth. By the way, just as an aside, success is a lousy teacher. Success is a lousy teacher. It’s where we fail, it’s where we make mistakes that we grow. I was so blessed six weeks ago to meet John Maxwell in person and have a chat with him. He was our keynote speaker, one of the masterminds that I’m a member of.
Jay Conner [00:33:50]:
And the audience member asked him,, What’s the one thing that you attribute your success to? And John Maxwell says, well, I just fail more than anybody else. He said, You know, our wins are only about 30% of what we try. But if somebody else tries 10 new things, they fail seven times, they win three times. I’m going to try a hundred new things, I’ll fail 70 times, but I’ll get 30 wins.
Darrin Gross [00:34:22]:
Now that’s beautiful. I love that.
Jay Conner [00:34:25]:
Yep.
Darrin Gross [00:34:26]:
My parents always said I could have told you, but you wouldn’t learn anything. So another mantra.
Jay Conner [00:34:34]:
So yeah, pain is a wonderful teacher.
Darrin Gross [00:34:39]:
Yeah, amen to that. Hey Jay, where can listeners go if they’d like to connect or learn more?
Jay Conner [00:34:48]:
Sure. So, of course, www.PrivateMoneyChallenge.com, and then I’m very, very easy to find on the Internet. ww.JayConner.com.com and by the way, Darren, I’d love to invite your audience to come check out and listen to my podcast. We are now in our eighth year of podcasting, and the name of my podcast is I know this will be hard to believe. The name of my podcast is Raising Private Money with Jay Conner. You can also find me on YouTube. All your podcast favorite platforms. Come join the party.
Jay Conner [00:35:28]:
I always have amazing guests on the show. I release the podcast twice a week, early on Monday mornings and Thursday mornings. And I’m all the time interviewing other real estate investors as to how they have gone about raising private money and how they do it.
Darrin Gross [00:35:44]:
Awesome. Well, Jay Connor, I cannot say thanks enough for taking the time to talk. I always enjoy talking with you, learn a lot, and look forward to doing it again soon.
Jay Conner [00:35:55]:
Thank you so much, Darren. God bless you.
Darrin Gross [00:35:58]:
All right, for our listeners, if you like this episode, don’t forget to like, share, and subscribe. Remember, the more you know, the more you grow. That’s all I’ve got this week. Till next time. Thanks for listening to Commercial Real Estate Pro Networks. C R E P N Radio.
Narrator [00:36:17]:
You’re listening to CREPN Radio for influential commercial real estate professionals. For more information on this or any of our guests, like us on Facebook, CREPN Radio.
Narrator [00:36:17]:
Are you feeling inspired by the knowledge you gained in this episode? Then head over to www.JayConner.com/MoneyGuide, that’s www.JayConner.com/MoneyGuide, and download your free guide that shares seven reasons why private money will skyrocket your real estate investing business right now. Again, that’s www.JayConner.com/MoneyGuide to get your free guide. We’ll see you next time on Raising Private Money with Jay Connor.