***Guest Appearance
Credits to:
https://www.youtube.com/@motivatedsellerscom
“1-on-1 with Jay Conner: How This Investor Raised $2M in 90 Days Without Banks or Credit”
https://www.youtube.com/watch?v=n5WKN17_dlg
If you’re a real estate investor—or an aspiring one—chances are you’ve run up against the biggest hurdle in the game: funding your deals. Traditional bank loans can be restrictive, slow, and, as Jay Conner discovered in 2009, suddenly unavailable. But what if there was a way to fund your real estate deals without banks, hard money lenders, or credit checks, and keep all the profit for yourself?
That’s the secret Jay Conner, now known nationwide as the Private Money Authority, shared on a recent episode of “Investor One on One” with Or Sapir. Jay’s story isn’t just inspiring—it’s a masterclass in creative real estate financing and a roadmap for investors looking to access private capital.
From Bank Rejection to a Private Money Breakthrough
Jay’s journey began in small-town North Carolina, flipping houses the traditional way by relying on the local bank for funding. “I closed my first six years’ worth of deals with unsecured bank credit,” he admits. But like so many investors during the 2008-2009 financial meltdown, he found himself abruptly cut off from his bank—no warning, no recourse.
Shocked and frustrated, Jay did what any true entrepreneur does: he turned his problem into an opportunity. He reached out to a friend who introduced him to the concept of private money—capital provided by individuals, not institutions, who want to earn higher returns by funding real estate deals.
Jay dove in, learned everything he could, and attended his first seminar. The result? He raised over $2 million in private capital in just 90 days. That move not only saved his career, it launched him as a leader in teaching others how to use private funds to fuel their real estate ambitions.
Private Money vs. Hard Money: What’s the Difference?
As Jay explains, private money comes directly from individuals (think: people in your own network who have retirement accounts or extra savings) rather than institutions or hard money lenders. It’s not a JV partnership; the private lender acts as the bank, secured by a mortgage or deed of trust, while you, the investor, retain full ownership.
Jay highlights several advantages to using private money over hard money loans:
- Lower interest rates (Jay pays 8%, compared to 12-14% for hard money)
- No points or origination fees
- No extension fees
- 100% financing of the purchase and rehab costs
- Faster and more flexible closings
How to Raise Private Money Without Begging or Chasing
One of the biggest myths Jay busts is that private lenders are hard to find or only fund experienced investors. His approach? Don’t chase. Don’t beg. Don’t sell. Don’t persuade. Instead, become a teacher. Jay wears his “private money teacher” hat and simply educates people in his circle about the opportunity to earn stable, above-market returns by becoming a lender for his deals.
His key strategies include:
- Teaching (not pitching) the basics of private lending
- Explaining how their investment is protected (collateral, insurance, title, etc.)
- Laying out the program terms with total transparency
- Building trust by keeping deal discussions separate from the initial introduction
Proof in the Pudding: Real Results and Action Steps
Jay’s system has helped him—and countless students—secure all the funding they need, often with people they already know. In his world, there’s actually more private money available than there are deals to fund. With average profits of $86,000 per deal in his market, Jay’s proof is in the numbers.
Final Advice: Start With Education and Service
If you want to raise private money, Jay insists you start with the right mindset. “Lead with a servant’s heart. You’re not asking people for money—you’re offering them an opportunity they never knew existed.”
Whether you’re new or experienced, Jay’s story is proof that losing your bank can be the best thing that ever happened to your real estate career—if you’re willing to embrace private money.
10 Discussion Questions from this Episode:
- Jay Conner describes private money as having a greater impact on his real estate business than any other strategy. What are the main reasons he believes private money is so transformational for investors?
- Jay recounts the moment his bank cut off his funding, which forced him to pivot. How did that obstacle become an opportunity, and what key lesson did he learn from it?
- The episode emphasizes not “chasing, begging, or persuading” when seeking private money. What is Jay’s approach to connecting with potential private lenders, and how is it different from traditional methods?
- Jay provides a script he uses when calling potential private lenders. What elements stand out to you from his approach, and how do you think this builds trust?
- How does private money differ from hard money or traditional bank loans, according to Jay? What are some of the advantages and disadvantages he highlights?
- Jay shares a story about raising $2 million in less than 90 days. What were the two keys to that rapid success, and how might someone replicate that today?
- The discussion covers many myths about raising capital as a new investor. Which myth surprised you the most, and why do you think these misconceptions persist?
- Jay emphasizes combining strategies such as using private money with creative financing or lease options. How might this flexibility change your approach to potential deals?
- For those struggling with the fear of rejection when raising capital, Jay offers the perspective of leading with a “servant’s heart.” How can this mindset shift impact your success in attracting private lenders?
- Jay shares his advice about the importance of finding a mentor early in your investing career. If you were starting now, what kinds of mentors or educational resources would you seek and why?
Fun facts that were revealed in the episode:
- Jay Conner Raised Over $2 Million in Private Money in Just 90 Days: After being cut off from traditional bank funding in 2009, Jay pivoted quickly and was able to secure more than $2 million in private funds—his first $500,000 came from a single conversation at his church!
- He Always Brings Home a Big Check When Buying Properties: Jay’s method for using private money allows him to actually get paid at the closing table, often walking away with a check of $30,000–$50,000 (or more) when he purchases a property—without having to use his own money.
- Private Lending Was New to All His Lenders: None of Jay’s 47 private lenders had ever heard of private money or self-directed IRAs before he taught them about it. By putting on his “teacher hat,” Jay turned friends, fellow church members, and community contacts into enthusiastic real estate partners.
Timestamps:
00:01 Private Money Expert: Jay Conner
04:41 Secretive House Sale
07:06 Bank Cutoff’s Life-Changing Impact
10:02 Discovering Alternative Funding Options
14:49 Self-Directed IRA Investment Pitch
19:02 Private Lender as Mortgagee Policy
23:13 Real Estate Discount Buying Strategy
24:13 Real Estate Investment Strategy
27:37 Real Estate Investment Referral Pitch
33:41 Real Estate Investment Strategies
36:37 Abundance of Private Money
39:50 Pre-Listing Strategy: ‘Coming Soon’
43:02 Offering Financial Opportunities, Not Begging
45:33 Value of Experienced Mentorship
47:59 Health and Real Estate Transformation
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
Cracking the Private Money Code: Jay Conner’s Secrets to Real Estate Funding Success
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. In 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 [00:00:29]:
But I wouldn’t have gotten, I wouldn’t have made $160,000 unless I’d had the motivated sellers.com lead and the private money. I closed that deal in seven days. If you’re investing in the podcast for all.
Jay Conner [00:00:46]:
Things real estate investing.
Or Sapir [00:00:48]:
So welcome back to another episode of Investor One on One, the podcast where we connect the nation’s top real estate investors who are reshaping the industry and redefining success. Today’s guest is a legend in creative real estate financing, known nationwide as the Private Money Authority. He’s helped countless investors fund their deals without banks, credit, or hard money. After being blindsided when his bank cut off his funding, he turned frustration into innovation, developing a system that landed him over $2 million in private money in just 90 days. He’s a creator of where to get the Money now and and his strategies are allowing investors everywhere, big or small towns, to profit without limits. So let’s dive in and see how he cracked the code to private money and built a funding empire that fuels real estate deals coast to coast. Welcome to the show, Jay Connor. It’s a pleasure having you, man.
Jay Conner [00:01:39]:
Or thank you so much for inviting me to come along and talk about the subject that I’m so excited about and so passionate about, being private money. And I’ll tell you why I’m so excited about private money. It’s because since I started using private money all the way back in 2009, I’ve never missed out on a real estate deal. After all, I didn’t have the funding. Private money’s had more of an impact on our real estate investing business than any other strategy that we have put to work.
Or Sapir [00:02:11]:
I love it and I’m so excited to hear more from you, especially because you’re so passionate about it. You’ve been doing this for such a long time. So let’s start off with your story. Take us back a little bit. What was your first real estate deal like, and how did that set the stage for your journey?
Jay Conner [00:02:26]:
Oh, wow. So my first real estate deal goes all the way back to 2003. 2003. And my wife, Carol, Joy, and I live here in Eastern North Carolina, in a very, very small town, Morehead City, North Carolina. Our total target market is only 40,000 people. So we’re in a small market. But since that time, we’ve bought and sold and rehabbed over 500 houses. Since we started in the business and the first six years, or from 2003 until January 2009, all I knew to do to get my deals funded was go to the local bank and get on my hands and knees and say, Please fund my deal.
Jay Conner [00:03:12]:
So, you know, that’s how I got my first deal funded. Now, this was way before I knew anything about private money. I had an unsecured line of credit at the local bank. This was in 2003. Back in that time, if you could fog a mirror and prove you had a pulse, you could get an unsecured line of credit. I had a $250,000 unsecured line of credit. And so I really didn’t know what I was doing. I looked at the Homes magazine.
Jay Conner [00:03:41]:
I found this foreclosure, this bank-owned property. And so I got it under contract. I bought it with. For $50,000. I put $50,000 worth of rehab in it. And I had. So then I had 100,000 in it using the unsecured line of credit. So it was all beautiful, totally rehabbed.
Jay Conner [00:04:03]:
And I put it in the multiple listing service. And I tell you, it’s funny, 45 days went by with no showings, and this home was absolutely beautiful. I had it listed for $139,900. So, with no showings in 45 days, I was reading one of those books on creative selling. And so the. What I read in the book was, it said, if you put an ad in the paper. This was back when people put ads in papers. If you put an ad in the paper that offered owner financing, you could sell your house really fast.
Jay Conner [00:04:41]:
So I put an ad in the local paper offering owner financing. And I didn’t put the address of the house. And one of the first people who called me, his name was Linwood. Linwood called me up and he says, Jay, I want to see this house. And I said, Well, Linwood, it’s sort of hard to find in Morehead City, North Carolina. I said, if you meet me at the second gas station, you can follow me into the house. Well, you see, the fact of the matter is, it was on Mayberry Loop Road. And if you went down the ugly side of Mayberry road, you’re not looking so good.
Jay Conner [00:05:14]:
But if you go down the beautiful side of maybe look road, then that’s looking good. Leading up to this house that I had for sale. So Lin would meet me at the gas station. He followed me into the house, pulled in the driveway. I had it landscaped, absolutely beautiful. And I opened up the door, and he went in and looked around. He came back, he says, Jayy, I’ll give you an $18,000 lease option. Deposit it right now.
Jay Conner [00:05:42]:
There was only one problem with that. I didn’t know what a lease option deposit was, but my daddy told me, if somebody offers you money, you take it and you’ll figure it out. So Linwood wrote me a check for $18,000 as a lease option deposit to sell it to him on terms, you know, rent-to-own or lease purchase. Well, I was mortgage-broke, still at the time, originating mortgages. And back then, if you had a mid credit score of 580, I could get you done and get you a mortgage. Well, God is good. Linwood had a 583 credit score. I got him an FHA mortgage.
Jay Conner [00:06:21]:
I applied that $18,000 to his closing cost and his FHA down payment, and I cashed him out, and I cashed the property out. So that first deal, I made $39,000, and I don’t even know what in the world I was doing. So as I said, I used local bank funding for my first six years here in the business. But then all that changed in January 2009, and that’s when I learned about private money.
Or Sapir [00:06:55]:
And that’s kind of following up on my next question. So eventually the bank kind of cuts you off, and that’s what led you to private money. How did that moment shape your approach moving forward?
Jay Conner [00:07:06]:
Well, that moment when I was cut off from the bank changed everything. I mean, if it had not been for that moment or the bank cutting me off in January of 2009, you and I wouldn’t even be here, you know, visiting on this podcast. I remember it, or if it were yesterday. I was sitting right here at my desk and, you know, believe it or not, we actually still have handsets and cords here in North Carolina. But anyway, I was sitting here at my desk, and I picked up my phone and called up Steve. Now, Steve was my banker. Steve had been my banker for six years. He had funded a bunch of deals for me, and I had two houses under contract.
Jay Conner [00:07:49]:
And so I called him up to tell him about the funding that I needed for these two houses. Now, this was January 2009. After being in the business for six years. And I learned that over the telephone or that the bank had closed my line of credit with no notice. I said, Steve, what in the world are you telling me the bank has cut off my line of credit? Why? He said, Jay, don’t you know there’s a global financial crisis going on right now? I said no, but you just gave me a financial crisis by cutting me off with no notice. He says, so SorryJay. He said, The bank’s not loaning money out to real estate investors anymore. So.
Jay Conner [00:08:31]:
Or I hung up the phone, and I sat here for a moment. I want to share with you or with your audience a very powerful question that I asked myself right after I learned that the bank had cut me off. And you know, the powers and questions and this question I want to share with you will help fix any problem that anybody has. I don’t care if it’s health, financial, career, relationships, or money doesn’t matter. And here’s the question, by the way, as a side note, these people running around saying every problem is an opportunity. I want to throw up. I want to be like the Kool-Aid guy who runs into a brick wall. I didn’t have an opportunity; I had a problem.
Jay Conner [00:09:18]:
Now the problem became an opportunity, or you and I wouldn’t be here. But at that moment in time, for goodness ‘sake, let’s face the facts, I had a problem. Here’s the question I asked myself. I said, Jay, who do you know that can help fix your problem? I immediately thought of a good friend. His name is Jeff Blankenship. In fact, Carol, Joy, and I just saw him this past weekend. We know each other from church and going to a cappella gospel singing events. And I knew Jeff at that time was investing in single-family houses in Greensboro, North Carolina.
Jay Conner [00:10:02]:
So I picked up the phone, I called Jeff, and I told him what had just happened about me getting cut off at the bank. Jeff says, Well, Jay, welcome to the club. I said, What club is that? He said, That’s the club of having your line of credit cut off by the bank. I said, wWellJeff, why are you telling me that? He says, because my bank cut me off last week. I said, Well, Jeff, how are you going to get your deals funded? He said, Well, have you ever heard of private money and private lending? I said, No. He says, Have you ever heard of self-directed IRAs and how people can use retirement funds that they already have to earn interest that we would pay them, they would fund our deals, and the interest they earn would be tax-deferred or tax-free. I said, Jeff, I don’t have a clue what in the world you’re talking about. I said, What is private money? He said, Well, there’s this gentleman down in Jacksonville, Florida, by the name of Ron LeGrand.
Jay Conner [00:11:02]:
I said, Who is Ron LeGran,d and what is private money? He says, I don’t know what private money is, but Ron Legrand says, we can get a lot of it. I said, Okay. So I went to my first real estate investing seminar with Jeff to the Ron Legrand event all the way back in January 2009 to learn about private money and private lending. And I did. I learned about private money. And you know what? I learned? Or I came back from that seminar and I learned that the way to attract private money for your deals, the secret, is not to don’t chase, beg, sell, or try to persuade anybody into anything. You know, the worst time in the world to be trying to raise private money is when you need it for a deal. Now here’s a ride or downer or desperation’s got a smell to it.
Jay Conner [00:12:01]:
And if you’re looking to raise private money and you have a deal to fund, you already sound desperate. So here’s the secret sauce. What did I do? I separated the conversations of talking about private money to people in my own warm market with my own connections, and then having a deal to fund. So here’s what I did, here’s how I went about doing it. You know, the traditional way is to go to the local bank, fill out applications, have your credit score pulled, and they do appraisals, all that stuff. Well, here’s a very, very important distinction to understand. People ask me all the time, Jay, how do I get started raising private money? I tell you, the very first thing you’ve got to do is own the real estate between your ears. Now what does that mean? What that means is to have the right mindset.
Jay Conner [00:12:51]:
You see, I’ve never asked anybody for money to fund my deals. So how do I get my deals funded? Here’s the secret. I put on my teacher hat, which says private money teacher. Now, here’s what’s so powerful about this. You see, I’ve got 47 private lenders right now funding my real estate deals. And. And you know what’s interesting,g or not one of these 47 people ever heard of private money. Until I told them about private money, they had never heard anything about self-directed IRAs.
Jay Conner [00:13:30]:
So what did I do? I went about teaching people in my own warm market, people I go to church with, people in the Rotary Club, people that I ordinarily see regularly. I put together my program that I was going to offer. So you said, instead of asking for a mortgage in this world, I’m offering a mortgage. So I teach them the program. I teach them, say here, here’s what private money is. Here’s how you can use investment capital, or you can use retirement funds to fund your deal. And I’ll pay you either tax-free or tax-deferred interest, depending on the type of retirement funds you have. So I told him the program. I’d say, look, here’s the interest rate I pay, which by the way is 8% no points.
Jay Conner [00:14:15]:
I’ve been paying 8%, no points ever since 2009. Here’s how you protect it. Here’s how you can get your money back in case of an emergency. So then they tell me they like the program and how much money they get to work with. Here’s the last secret I’m going to share, a nd I’m going to turn it back to you, or I’m going to share the exact script. The exact script I say when I pick up the telephone and call a private lender to fund my deal. You see, they’ve already told me how much they’ve got to work with. So let’s do a little role play here.
Jay Conner [00:14:49]:
Or let’s say you’re one of my new private lenders. Hypothetically, let’s say you and I have known each other for quite a while. We’re friends, you know, you already trust and like me and all that. And I’ve told you about private money, and you’ve told me you’ve got $150,000 in a retirement account, a 401k in a previous employer. So I’ve introduced you to my self-directed IRA company that I recommend. And let’s say that you’ve moved that $150,000 over and you have now established your self-directed IRA account. And guess what? When you did that, I told you I’m going to put your money to work for you just as soon as possible. So a week or two goes by, and I call you up, you answer the phone, and we have a little chat.
Jay Conner [00:15:42]:
Here’s the exact script, the exact words that I say for you to fund my deal. So I call you up, we have a little chat, and I said, or I have got great news for you. I can now put your money to work. I’ve got a house over in Newport, North Carolina, with an after-repaired value of $200,000. Now the funding required for the deal is $150,000. That matches up to the funds that you’ve got set aside in your retirement account. Now, closing is going to be next Tuesday, so you’ll need to wire your funds from your account to my real estate attorney’s trust account. I’m going to have my real estate attorney email you the wiring instructions.
Jay Conner [00:16:30]:
That’s the end of the conversation. The most stupid thing that I could ask OR is Do you want to fund the deal? Of course. Or wants to fund the deal. And I’ll tell you why. Or wants to fund the deal. Number one, because he’s moved that money over to the self-directed IRA company at my recommendation. So he’s already moved the money over. Number two.
Jay Conner [00:16:56]:
Or knows I’m not going to bring a deal for him to fund unless it matches the criteria of the program I already taught him. And number three, for goodness’ sake, or’s not earning any money until I put his money to work as I promised him I would. So I’m ethically bound and obligated to invest or ‘s’ money. Unpack that. I taught him about private money. I told him about the program. He loves the program. He’s moved his money over, and now I’m going to put his money to work, and everybody is happy.
Jay Conner [00:17:35]:
Love that.
Or Sapir [00:17:36]:
Well, that’s a really good script. So I really wanted to invest. As you were saying that, I was like, take my money for a moment. Let’s go a little bit back and talk about what exactly private money is for our investor. Hearing this, because we have some newbies, we have some seasoned investors, but I want to hear what private money is to you and how it differs from hard money or traditional bank loans, like we spoke a little bit about.
Jay Conner [00:17:57]:
Thank you. Yeah. So private money. So here’s what a private money lender is. Here’s who a private lender is. A private lender is an individual, a human being just like you and me, who loans either their investment capital or their retirement funds to U.S. real estate investors. So the private lender is the bank.
Jay Conner [00:18:22]:
So when we say private lender, I’m not talking about a JV partner. The private lender does not own any of the property. The private lender acts in the same capacity as a bank. So it’s your land trust, your LLC, whatever entity that you’re investing in. You own the property; your entity owns the property. The private lender is the bank. Which means we’re going to protect them the same way we protect the local bank or mortgage company. We’re not going to borrow any unsecured funds; we’re going to give them a mortgage or a deed of trust to collateralize the promissory note.
Jay Conner [00:19:02]:
We’re going to name them on the insurance policy as the mortgagee. So if there’s ever a claim against that insurance policy, then the insurance company makes the check payable to the lender, to the private lender, and to your company. We’re going to name the private lender on the title insurance policy as an additional insured in case there are any title issues down the road. So the private lender is the bank. Now, let’s be very, very clear. I’m not talking; when I say private money, I’m not talking about hard money. Now, hard money is typically a source of money. A hard money lender broker is typically a broker that’s gone out and raised money for their fund for people to invest in.
Jay Conner [00:19:52]:
And then the hard money lender turns around and loans that money out to us real estate investors. And so there are lots of differences. By the way, I’m not poo pooing hard, hard money lenders. Some of my best friends are hard money lenders. They use my techniques to raise private money for their fund that they turn around and loan back out to real estate investors. So I say establish as many relationships as you can with as many people. But here are some very, very important distinctions and differences between hard money and private money. First, interest rate.
Jay Conner [00:20:31]:
As of today’s recording of this podcast, you’re going to be paying between 12 and 14% to a hard money lender. My land’s 12 to 14%. Goodness gracious. Well, private money, I’m paying 8%. Big difference in the interest rate. Secondly, hard money lenders are going to have points for origination fees, typically going to be two to four points. Private money, I never pay origination fees, no origination fees, just a straight 8%. Another big distinction is extension fees.
Jay Conner [00:21:07]:
So on hard money, if you haven’t cashed out in the length of the note, which is typically six months, nine months, maybe 12 months, then the hard money lender, if you extend the note, they want more money. I know one hard money lender that charges 3 more percent of your amount borrowed just to extend 90 days, that’s 1% a month, right? So with hard money, you’re going to be up to like 20% in your first year. With private money, there are no extension fees. Still just a straight 8%. Then another big distinction is how much money the hard money lender and the private lender are going to loan to you or advance when you buy the property. A hard money lender is only going to loan you 60 to 80% of your purchase price. Private money lender, big difference. You’re going to get 100% of your purchase price.
Jay Conner [00:22:06]:
And if you’re rehabbing, you’re going to get 100% of the rehab. We always bring home a big check when we use private money. We never take any of our own money to the closing table. Here’s the question. Who wants to get paid to buy properties without taking any of their own money to the closing table? Right. I always bring them a 30,000, 40,000, $50,000 check. Now I do want to make this distinction. Private money is not only for the ugly house business.
Jay Conner [00:22:40]:
Private money is not just for rehabbing private money. Here’s a writer downer. Private money is for when the seller doesn’t care if the seller is for sale by owner. An institutional, you know, REO bank-owned property, short sale, auction, it doesn’t matter. You’re going to use private money when the seller requires all the cash, period. Even if it’s for sale by owner. And so you know, and here’s, here’s a, here’s another writer downer. This is really important.
Jay Conner [00:23:13]:
Here’s a check and balance when you’re using private money to pay all cash for a, say single-family house. If you can’t bring home a big check when you buy and take none of your own money to the closing table, you’re paying too much for the house. So just to clear this up, keep it simple. This only works if you’re buying a property, no matter what condition it’s in, at a discounted price. Because you see, we’ll borrow up to 75% of the after-repaired value. So, back to that example where or is my private lender, you got a $200,000after-repaird value house that you’re going to buy? I didn’t say purchase price, I said after-repair value. Well, I’ll buy that house all day long for $100,000 or less than 50% of the after-repaired value. Well, you can borrow up to 75% of the after-repaired value.
Jay Conner [00:24:13]:
So follow the money. Follow the money. If the after-repaired value is 200,000, you can borrow up to 150,000. But if you’re buying it for 100,000, follow the money. $150,000 comes into the trust account for the real estate for the attorney who’s closing the deal. There’s $150,000 there in the trust account, 100,000 of that 150 goes to the seller. Now you have a $50,000 excess cash to close when you buy. Well, of course you’re going to use 30 or 40,000 of that for the renovation, but that leaves you another 10 or 15,000 in equity that you can use any way you want to. Marketing, carrying, cost, take a cruise to the Bahamas, whatever, it doesn’t matter, right? So that’s another big distinction.
Jay Conner [00:25:10]:
You always get to bring home a big check when you use true private money to fund your real estate deals.
Or Sapir [00:25:19]:
Those are amazing insights and really differentiate, you know, between the different ways to get money. So thank you for sharing that, Jay. One of the stories that kind of like caught on to me is how you raised over 2 million in 90 days. What was the key to that rapid success, in your opinion?
Jay Conner [00:25:37]:
Well, there were two keys. Two keys to getting $2 million in less than 90 days, right after being cut off from the bank. The first key was again, no chase and no begging, no selling, no persuading. I got my first $500,000 of that 2 million from one conversation. Let me share that in a short story. So Carol, Joe, and I are very involved in our local church, the Church of Christ here in Morehead City, North Carolina. And we go to Bible study on Wednesday nights. So it was a Wednesday night.
Jay Conner [00:26:13]:
Shortly after being cut off from the bank and me learning about private money, wwentgo to Bible study at 7:30 on Wednesday night here on Barber Road in Morehead City. I walked into the foyer. I was looking for a gentleman by the name of Wayne. Now Wayne and I had known each other for some time. I walked up to Wayne, I said, Wayne, I got something I’d like to talk to you about confidentially after Bible study. Have you got a few minutes? He said, Sure, brother J. So we have Bible study, we get together, and we walk down to the nursery. I closed the door.
Jay Conner [00:26:45]:
Here’s exactly what I said to Wayne. Here’s the script. Exactly what I said. I said, Wayne, you know everybody in this town. And he did. He was the Zenith Television dealer in Morehead City, North Carolina. Now, if you don’t know who the Zenith Television dealer was, that means you’re too young or too old to remember life before Walmart came to town. That’s where you bought your TVs.
Jay Conner [00:27:15]:
He’d come out and install your TV. He’d repair your TV, he’d finance your TV. Wayne had put a TV in everybody’s house in Morehead City. And so I said, Wayne, you know, Everybody in this town. And he did. He was very well with. Connected with the Rotary Club and all that. I said, Waynee, and here’s the magic phrase.
Jay Conner [00:27:37]:
Here’s the magic phrase. I said, Wayne, I need your help. I said, you see, I have now opened up my real estate investing business by referral only, and I’m now paying insane high rates of return to my investors. When you run across somebody who’s complaining about losing money in the stock market and hardly making anything in the local bank and a certificate of deposit, would you refer them to me, and I’ll tell them about my program? And Wayne looked at me. He says, Well, now, brother Jay, what you got going on there? And I said, Well, what are you saying, Wayne? I said, Are you saying you might be interested? He said, Well, I might be interested. I said, Well, why is that? He said, Well, I’m losing money in the stock market, as you just said, and I’m only making 3% in the local bank in a certificate of deposit. That’s what it was back in 2009. He said, What kind of rate are you paying? I said, well, Wayne, that just sort of depends on the deal.
Jay Conner [00:28:42]:
I said, What sounds high to you? He said, Well, I’m making 3% in a certificate of deposit. He said, I don’t know. I guess maybe 5 or 6%. I said, Wayne, I can’t pay you 5 or 6%, but I can pay you 8%. He said, Put me down for $250,000. So the next day, I went to his and his wife’s home here in Morehead City, and I put on my teacher hat, and I taught them about private money. They never heard of private money. I taught them my program.
Jay Conner [00:29:18]:
I taught them my interest rate I pay, how they’re protected, the maximum loan to value, and how I name them on the insurance policy. Remember the secret sauce? I didn’t talk about any deals that I needed funding for. I just talked about the program and the opportunity without any deal attached to that conversation. And you know what’s interesting? Or after two cups of coffee that afternoon, I went to their house the next afternoon. And after two cups of coffee, that $250,000 became $500,000. And so I told them I’d put their money to work for them just as soon as possible. And then I did. I gave him a call with good news phone call.
Jay Conner [00:30:05]:
That was the first 500,000. I got another $969,000 at one private lender luncheon. What in the world is that? I invited 20 people for lunch, and I paid for their lunch. And I had my CPA and my Realtor and my real estate attorney there, my credibility team. And at the end of lunch, I took 20 minutes and taught them. There you go again. Put on my teacher hat. And not one of these 20 people had ever heard of private money or several, several IRAs.
Jay Conner [00:30:43]:
So I had my little PowerPoint presentation, teaching the opportunity in the program again, with no deals attached to it. And at the end of that luncheon, I got $969,000 pledged from people who were interested. So right, there was one and a half million dollars of the 2 million that I got in the first 90 days.
Or Sapir [00:31:05]:
There are some amazing stories now that you get this money from, you know, these private lenders. You said you invest in only Morehead, or you invest all over North Carolina, Eastern North Carolina.
Jay Conner [00:31:19]:
So my rule is, if I can’t, in a reasonable amount of time, drive by the property, I don’t want to do it. Now, I’ve got friends that invest all over the nation, and I say have at it if you want to invest all over the nation. You see, I’m not wholesaling. Yeah, I’ve never wholesaled a deal in my life. By the way, for those of you wholesalers that are listening, the beautiful thing about private money is that now you can stay in any deal that you want to, without just taking an assignment fee. Right. By the way, if you are listening to this podcast and you are not signed up with motivatedsellers.com, you need to just don’t, don’t pass go, don’t go to jail, don’t pay $200. You need to get signed up for mmotivatedsellers. comright now.
Jay Conner [00:32:10]:
Listen, I’ve been with this crowd for over 7 years, getting motivated seller leads all the time. And the beautiful thing about their program is you don’t pay for any marketing until you’ve actually got a motivated lead that you’re talking to. Motivatedsellers.com is my number one source for motivated sellers. I digress. Anyway, again, if you’re a wholesaler with private money now, you get to stay in any deal you want to buy. My average profits right now here in eastern North Carolina are $86,000 on a single-family house. I just made $160,000 on the condominium. And guess where the lead came from? Motivatedsellers.com.
Jay Conner [00:32:57]:
Right, but I wouldn’t have got. I wouldn’t have made $160,000 unless I’d had the motivated sellers.com lead and the private money. I closed that deal in seven days. And if I hadn’t had the private money lined up, I would have missed out on that deal.
Or Sapir [00:33:16]:
That’s amazing. So now let’s say you find a good deal, you know, it could come from us or from anywhere else, and you find a deal, an off-market deal, and let’s say Morehead in North Carolina, and then you have someone you know is willing to give you that money. First of all, do you, let’s talk a little bit more about strategies. Do you buy and hold? Do you like flipping? What are your methods of investing?
Jay Conner [00:33:41]:
Yeah, it depends on how I buy it. So if I buy it with private money and I’m going to renovate it into a beautiful, beautiful, looks like a brand new home, I don’t want to leave private money buried in that house. So if I’m paying with all cash, my rule of thumb is just to cash out, flip, flip in, flip out, right. However, if I buy the property on terms, say subject to the existing note, or creative financing such as seller financing, if I buy it on terms from the seller, then typically I’m going to want to sell it on terms. Rent to own, lease, purchase. And you see, here’s an advanced strategy. You can combine two strategies. In one deal, you buy the house on terms from the seller, and if they’ve got equity, I can use private money in second position, a smaller amount like 20,000, 30,000 for renovations or rehab, or any kind of repairs that are needed.
Jay Conner [00:34:44]:
Or if they’re facing foreclosure and they’re behind on their payments, I can use private money to bring those payments current. So again, an answer to your question, or it depends on how I bought it. If I’m paying all cash for private money, I want to cash out. If I’m buying it on my own terms, I want to sell it on lease, purchase, or rent-to-own.
Or Sapir [00:35:06]:
That’s a really good point. Now, you’ve been in this industry for such a long time, and you are the private money guy. You’ve probably heard a lot of different stories, different myths. What are some of the biggest myths or misconceptions you hear about raising capital?
Jay Conner [00:35:21]:
Oh, my word. There are a lot of myths. One myth is that a new real estate investor will say, Nobody’s going to loan me money. I’ve never done a deal. Who in the world is going to, who’s going to loan me money? I’ve never done a deal. Well, here’s the answer to that myth. The answer is that if you don’t pay them, the Property does. Now, what in the world does that mean? You see, you’re not borrowing money unsecured. You’re going to collateralize the note with the deed of trust or the mortgage.
Jay Conner [00:35:58]:
Therefore, if you don’t pay them, the lender gets the property, and they actually end up making more money than the interest that you would have paid them. So that’s one myth. I can’t get any money because I’ve never, you know, done a deal. What’s another myth? Private lenders are hard to find. Private lenders are hard to find. That is a myth, because let me tell you something from experience right now. There’s more money out here to loan to you than there are deals. I mean, I got a problem right now.
Jay Conner [00:36:37]:
As of the date of this recording, I have over $1,250,000 available to me in private money. And it’s just sitting there. I mean, I’ve got eight and a half million of private money that I use, and I just roll it from house to project to project to project. We’ll have 12 or 15 projects going on simultaneously. But I’m telling you, there’s more money available than there actually are deals out there. There’s. There’s money all around you. And so another myth about private money that I’ve already talked about, but this is huge.
Jay Conner [00:37:13]:
Another big myth about private money is that he who has the money makes the rules. Not so. Not so. Not in this world. Right? We make the rules. We set the interest rate. We are, as the borrower. We are our own underwriter.
Jay Conner [00:37:36]:
Right. Another myth. Well, since the lender makes the rules, there’s no negotiation of the interest rate and the terms. Guess what? That statement is partly right. There is no negotiation. We make the rules, we set the interest rate, and that’s it. There’s no. There is no negotiation in the industry because you’re in the driver’s seat.
Jay Conner [00:38:02]:
You are your own underwriter. And you know what I say, just duplicate my system, just duplicate my program, because it seems to work pretty well. And I’m actually going to give it to you here in just a little bit.
Or Sapir [00:38:17]:
Well, I’m excited for you to share that, and I’m happy you cleared out these myths, because I see there are a lot of myths and fear when it comes to private money. But let’s talk a little bit more about your program, kind of talk more about how this works in the field. So, can you walk us through a typical private money deal from one of your students from start to finish?
Jay Conner [00:38:36]:
Sure. So I’m thinking of one particular deal. So it came in on motivatedsellers.com, and the purchase price was $150,000. $150,000. And it was a major renovation. The after-repaired value was $400,000. That’s a pretty good spread. 150 to 400.
Jay Conner [00:39:08]:
And so it was a major renovation. The renovation was about $75,000. So all in 225, after the repaired value, 400,000. And so, of course, the good thing about the market we’re in here in North Carolina, in fact, this house was just put on the market less than a month ago. And here’s what the student did that I taught the student to do. When the house is ready to sell and put in the multiple listing service, list it with your realtor. I only pay 5%, not 6% of the sale price. And on Monday, put it in the multiple listing service.
Jay Conner [00:39:50]:
Have your realtor put it in the multiple listing service under a category called coming soon. Coming soon. What that means is nobody can look at the house, but they can look at the price, they can look at pictures, and they can look at the description. But then on Friday, have it go active. That means people can look at it. So what we want to do is line up a bunch of appointments, or your realtor lines up a bunch of appointments for people to see that house on Friday, after going, you know, active. For this particular property that I’m thinking of, my student had over 20 showings in 48 hours, multiple offers, and went under contract for $20,000 more than the asking price. Now, here’s the takeaway from that illustration and that story.
Jay Conner [00:40:45]:
Unless my student had been signed up with motivatedsellers.com, they wouldn’t have gotten the lead. The second takeaway is that unless they’d had the private money lined up to offer to pay all cash, they would have missed out on the deal. So it’s a pretty, pretty easy conclusion. Sign up with motivatedsellers.com and get private money lined up before you need it.
Or Sapir [00:41:08]:
Wow. I love it. You know, straight to the point. Sometimes people take things and they make it so complicated, they get scared. But, you know, if you just like you’ve been giving us all these examples, you kind of took the way of doing things, and you jumped into the water, you know what I mean? And then things along the way happened, and eventually, you know, you reach the. The vision that you had before. So thank you for sharing that story. It’s very inspirational, very motivational.
Or Sapir [00:41:33]:
And just like we spoke a little bit about fear, you know, a Lot of people who are now hearing this. Maybe private money is new to them, or maybe they’re just starting to invest. What fears did you have when you started raising money in the beginning? And how do you handle objections like this sounds risky, or I’ve never done this before?.
Jay Conner [00:41:52]:
Yeah, I’m glad you brought that up. Or because new real estate investors who have never raised capital will say to ms Jay, I just don’t know how to do this. And what they’re saying is they say they have a fear of rejection. A fear of rejection. Let me answer that question or that concern with a question. How can you have a fear of rejection if you’re not asking anybody for anything? I haven’t asked anybody for money. All these examples I talked about, I haven’t asked anybody for money. I told you about Wayne.
Jay Conner [00:42:32]:
I didn’t ask him for money. I asked him for his help to spread the word, to let people know that I now have an opportunity. I didn’t ask him for money. But what did he do now? He’s interested. Right. And by the way, Wayne did spread the word, nd we got a ton of referrals. So how do you overcome the fear of rejection? Lead with a servant’s heart. You see, this is not about you.
Jay Conner [00:43:02]:
This is not about you getting the money. This is about you serving these other people and offering them an opportunity that they have never heard of. And if you’re not asking anybody for money, and you’re just teaching them what private money is and what self-directed IRAs are. You know what’s interesting? Or over the years, we have gotten so many thank you notes in the mail for how we have been a part of changing people’s retirement years by offering them an opportunity that they had never heard about. One in particular I’m thinking about, they thanked us for changing their retirement years because that private lender, they got to go visit their grandchildren down in Florida anytime they wanted to because of the rate of return in private money that we were paying them that they were, they would not have gotten otherwise. So it’s all about win-win solutions. Again, you’re not asking, begging, chasing, or persuading. You’re offering an opportunity.
Jay Conner [00:44:04]:
You’re teaching people what this is all about without ever asking. It’s all about serving.
Or Sapir [00:44:12]:
I love that. I was gonna say it’s all about serving. And you know, both sides are winning. So you always have to see how the other person is gonna gain out of this. And it’s very similar to marketing. You know, I come from a marketing background. I’ve been doing marketing for years. It’s like if I market something and tell you, buy it, buy it, buy it, I show you that we’re desperate to sell a product versus teach you about the product, you know, make it more valuable for you.
Or Sapir [00:44:35]:
And then eventually you see, like, wow, this is interesting. This is what I needed. Then you kind of come to me, you know what I mean? So that’s a very interesting take. And I think that strategy is what’s going to get investors to really, you know, get the money they need.
Jay Conner [00:44:49]:
Absolutely.
Or Sapir [00:44:50]:
Now, following up on that, let’s say you started. You know, you’ve had a very amazing career, and you’re still doing really cool things. And I. I love today’s conversation. You know, I got a lot of value from it myself. But if you had to start from scratch, and this is a question I love asking so many kinds of investors, because, you know, I talk to people in the industry that do so many different kinds of things. We all have the same goal in mind. You know, I mean, we want to help as many people as we can.
Or Sapir [00:45:14]:
We want to increase our profits. We want to get as many deals as we can. But if you had to completely start from scratch today, May 5, no deals, no private money, no connections, you know, just you, Jay Connor. But you wanted to succeed in real estate all over again. What steps would you take in the first 90 days?
Jay Conner [00:45:33]:
Get a mentor who knows what they’re doing. I was in this business for six years without having a mentor or coach holding my hand. And it wasn’t until I lost my line of credit at the bank that I searched for a mentor and, you know, to learn about private money. But, you know, or I think about in the past, those first six years, I lost hundreds of thousands of dollars because I didn’t know what I didn’t know. I’m thinking of one particular property, a condominium I invested in. I was planning on flipping it. The market turned. I hadn’t run the numbers on cash flow, so I had to rent it out.
Jay Conner [00:46:18]:
And for a long time, I lost money every month because I hadn’t understood the numbers on renting it out. So those types of very, very expensive lessons will save you so much money if you get a mentor or a coach right up front instead of waiting until you have a problem, that’s. That’s the biggest thing I would have done differently.
Or Sapir [00:46:42]:
And to conclude this, what’s one book, podcast, quote, or just a piece of advice that, you know, comes from you, Jay, that’s made a lasting impact on both your real estate career and your personal life?
Jay Conner [00:46:56]:
Well, so many books. I mean, it’s the books you read and the people you meet that will have the biggest impact on your destiny and your future. I’ll share one book that changed my life, literally changed my life, changed the trajectory of where I was going. And that’s when I was 24 years old. I was in a very, very dark place. And I woke up one morning saying, you know, life has got to be better than this. Had no relationship with God. The family had sort of cut me off.
Jay Conner [00:47:28]:
I didn’t have any friends to really speak of. And so I went to the bookstore, and I went to the personal development section, and I found a book that changed my life. The name of the book is University of Success, and it’s by OG Mandino. It’s still in print. It changed my life.
Or Sapir [00:47:50]:
Wow. And what’s next for you, Jay, for your career and for your personal life? Just to get a little bit more, you know, more about you.
Jay Conner [00:47:59]:
What’s next for me is to get my health in better health. I want to lose 50 pounds. I’m telling you I want to get in better health, or for goodness’ sake, but that’s not the kind of answer you were looking for. So what’s next for me? What’s next for me is looking for more opportunities to make an impact and help other real estate investors transform their lives and transform their businesses. Private money transformed mine and had the biggest impact on my business. And so I’m at a stage of life right now where I just love giving back. I love being passionate and sharing my passion about how private money can transform other people’s real estate investing businesses. And that’s what’s next for me is looking for as many ways as I can to share inspiration, transformation, and true knowledge on how to be in control of your real estate investing business by using private money, for sure.
Or Sapir [00:49:02]:
And thank you today, you know, for inspiring me. And in general, Jay, I love the energy, the perspective you have on life. It’s very, very important in and out of our careers, and in general, thank you for sharing your insights today and experiences, and all those amazing stories with us today. It’s been a pleasure having you on Investor One-on-One. If our investors who are watching this want to connect with you or learn more, how can they find you?
Jay Conner [00:49:24]:
Thank you. Or as a thank you to all of you who have been listening and tuning in here to Investor One on One, I’d love to give you a gift. And the gift is a copy of my most recent book, How to Get the Money Now. Where to get the Money Now Subtitle: Where to get all the money for your real estate investing deals without relying on institutional money or hard money lenders. I will send this to you via express mail, and it’s 20 bucks on Amazon. But don’t go to Amazon. Let me give you the book for free. Just cover shipping, and you can pick up the book at www.JayConner.com/Book.
Jay Conner [00:50:10]:
That’s www.JayConner.com/Book. I’ll rush you right out. I’m also going to include two tickets to the Private Money Conference, which is coming up right around the corner. This is a $3,000 event, but because you’re listening to investor one on one, I’m going to include those two tickets valued at $3,00,0, and you get to come for only a 97 registration fee. That’s just to hold your seat. So I’ll send you the book, I’ll send you tickets to the live event, and also my podcast. Obviously, you love podcasts. You wouldn’t be tuning in. I’m now in my eighth year of podcasting, and the name of my show is Raising Private Money.
Jay Conner [00:50:52]:
Imagine that, Raising Private Money with Jay Conner. It’s on all the podcasts, platforms, and every week, twice a week. I got two shows a week. I interview other real estate investors who have raised private money and how they go about doing it. Come join the party.
Or Sapir [00:51:10]:
Wow. So that’ll be linked below, and everyone is watching. Thanks again for tuning in.
Narrator [00:51:18]:
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 jconner.com moneyguide to get your free guide. We’ll see you next time on Raising Private Money with Jay Conner.
