***Guest Appearance
Credits to:
https://www.youtube.com/@RafaelCortezCEO
“EP 71 | JAY CONNER – This is the right way to find private money for your deals! | Investor strategies.”
https://www.youtube.com/watch?v=TuS1QNcmiCw
In the dynamic world of real estate investing, access to capital often determines how quickly you can seize opportunities and scale your business. Many investors focus on traditional bank loans or hard money lenders, but there’s a powerful funding alternative that can transform a real estate business: private money. This topic was expertly explored when Jay Conner joined Rafael Cortez on the CEO Pulse Podcast, sharing his journey, strategies, and mindset that have made him a standout in the industry.
Jay Conner’s path into real estate began in the early 2000s, after years in the manufactured and mobile homes sector. In a small town in Eastern North Carolina, with a population of just 8,000 and a target market of 40,000, he found success not by volume, but through creating consistent high-value deals. His average profit per deal stands at an impressive $71,000, a testament to the effectiveness of his approach in a niche market.
One pivotal moment in Jay’s business occurred during the financial crisis of 2009. Prior to this, his deals were funded through local banks, relying heavily on lines of credit. Suddenly, with two lucrative properties under contract and over $100,000 in potential profit at stake, Jay discovered that his bank had closed his lines of credit. The market downturn had dried up traditional funding without warning. Rather than quit, he sought new answers—and that search led him to private money.
Private money, as Jay describes, is sourced from individuals—ordinary people with investment capital or retirement funds who are looking for secure, high returns. Unlike hard money lenders, who act as intermediaries and often charge higher rates and fees, private money comes directly from the source. For investors, this means lower interest rates, fewer fees, and greater flexibility. Jay’s system allows him to fund deals with up to 150% of the after-repair value, often resulting in a large check at closing with no out-of-pocket contributions.
Building a network of private money lenders hinges on education and relationship-building. Jay’s strategy doesn’t involve begging or desperately pitching deals. Instead, he focuses on teaching potential lenders about the value and security of real estate investing, particularly through self-directed IRAs. The education-first approach helps people understand how their funds can work harder, often yielding much higher returns than traditional financial products. Once the concept and program are explained, lenders are enthusiastic to participate—often finding Jay before he finds them.
Jay emphasizes the importance of having a clear, attractive private money program in place. This includes specifying interest rates, protective measures (like securing the loans with a mortgage or deed of trust), insurance, and a clear process for accessing funds or calling the note. Establishing relationships with self-directed IRA companies is also a key step, enabling lenders to invest with tax advantages.
For those new to raising private money, Jay outlines a five-step process: start by making a list of potential lenders within your warm market, initiate casual conversations (either one-on-one or in group settings like luncheons or Zoom calls), provide educational materials, teach the lending program in detail, and finally, secure a verbal pledge. Only after a lender is informed and committed do you match them with a deal, which projects confidence and proper preparation.
Jay’s approach demonstrates that the right mindset is foundational. Investors must recognize their role not as beggars, but as educators offering an opportunity. By preparing ahead and projecting confidence, the process of raising private money becomes collaborative and beneficial for all parties involved.
As Jay looks back, he credits adversity—like losing bank funding in 2009—as catalysts for growth, pushing him to discover better and more resilient financing options. His journey highlights the power of mentorship, networking, and consistently seeking ways to improve and adapt in a changing market.
For real estate investors seeking to build a sustainable business, embracing private money as a funding source could be the game-changer. It’s not just a strategy, but a mindset shift that puts the investor in the driver’s seat, ready to capitalize on opportunities and weather market challenges.
10 Discussion Questions from this Episode:
- Jay Conner mentioned that he always gets a big check at closing by utilizing private money. What are the key differences between private money and traditional funding, and why does this approach work so well for him?
- In a small market with only a 40,000 population, Jay Conner consistently makes high profits on fewer deals. What strategies does he use to stand out in this niche and maintain authority?
- Rafael Cortez and Jay Conner discussed the importance of reputation and branding in real estate. How do longevity and relationship-building impact deal flow, especially through referrals?
- When Jay Conner lost his traditional lines of credit in 2009, he pivoted to private money. What mindset shifts did he make during this adversity, and how did those changes create new opportunities?
- The formula “Event + Response = Outcome” was shared by Jay Conner as a critical mindset piece. How can this perspective be applied to other entrepreneurial challenges?
- Discuss the distinctions Jay Conner made between private lenders and hard money lenders. What are the pros and cons for real estate investors using either source?
- Jay Conner shared his step-by-step process for raising private money, including “making your list.” What are the most important qualities to look for in a potential private lender, and how should these relationships be approached?
- What role do self-directed IRAs play in private money lending, according to Jay Conner? How can real estate investors leverage retirement funds for their deals?
- Why does Jay Conner recommend teaching your private money program first, rather than pitching a deal immediately? What are the risks if you don’t follow this approach?
- Jay Conner reflected on the value of mentorship and mastermind groups. How can surrounding yourself with the right people accelerate your business success, and why might this advice be particularly important for a younger entrepreneur?
Fun facts that were revealed in the episode:
- Jay Conner has completely automated his real estate business to the point where he works less than 10 hours per week, despite having rehabbed over 400 houses since 2003.
- In Morehead City, North Carolina—a town of only 8,000 people and a target market of just 40,000—Jay Conner averages $71,000 profit per deal by leveraging private money to make all-cash offers.
- Jay Conner once raised over $2 million in private money in under 90 days, which eventually allowed him to help thousands of other real estate investors learn how to do the same.
Timestamps:
00:00 From Mobile Homes to Flipping
05:56 Shift from Mobile to Housing
09:47 Discovering Private Money Lending
10:41 Failure Only Happens If Quitting
13:58 Adversity Sparks Opportunity
17:06 Private vs Hard Money Lenders
21:18 Private vs. Hard Money Lending
24:13 Private Lending and Mindset Essentials
30:02 Teaching Private Lending Program
31:58 Step-by-Step Confidence Builds Success
35:21 Demystifying Private Money Strategies
37:39 Get a Mentor Early
41:20 Private Money Mastery
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
How Jay Conner Became the Private Money Authority and Automated a 7-Figure Real Estate Business
Jay Conner [00:00:00]:
Another big, huge distinction is when you buy a property, let me tell you what I love about private money. I always get a big check when I buy, when I buy, and bring no money of my own to the closing table, right?
Narrator [00:00:13]:
If you are a real estate investor and are wondering how to raise and leverage private money to make more profit on every deal, then you are in the right place. On 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.
Rafael Cortez [00:00:54]:
Hey, what’s up? Welcome back tothe CEO Pulse Podcast, where you get the real, the raw, and the mind of entrepreneurship. We are sitting down today with Mr. Jay Conner. Check this out, right? He has been in the real estate game. I’ll call it the game, right? Because there are so many different aspects to it. But in the real estate game since 2003, has rehabbed over 400 houses. And for the past 7 years, he’s completely automated his 7-figure real estate business to the point where he works, check this out, less than 10 hours per week on his business. All right? So one of his main things now is private money.
Rafael Cortez [00:01:28]:
And he is known as the Private Money Authority. So, because he has raised over $2 million in under 90 days, you know, at one point. So, it’s really impressive, right? To see the track record that Jay has. I’m very, very lucky to have him on the podcast. So, Jay, welcome to the show. Thank you for spending the time with us.
Jay Conner [00:01:48]:
Hey, Rafael. Thank you so much for inviting me to come along. And I’m excited to be here to talk about one of my favorite subjects.
Rafael Cortez [00:01:57]:
Let’s do it. Let’s do it. So, you started in 2003? In buying and selling houses, right?
Jay Conner [00:02:05]:
So, full-time 2003.
Rafael Cortez [00:02:09]:
Full-time 2003. And you’ve been, you’ve been in this space since, since how long before then?
Jay Conner [00:02:16]:
Yeah, so I was actually raised in the housing business. I was in for years and years, mobile homes, manufactured homes. But in 2002, 2003, pretty much all the consumer finance went away on that product. And so I knew if I ever got out of mobile homes, I wanted to get into single-family houses and flipping houses and all that kind of good stuff. So I went, uh, my wife Carol Joy and I, we’re here in Eastern North Carolina, a real teeny tiny small town. We’re in Morehead City, North Carolina, right here on the East Coast, population 8,000. And our total target market’s only got 40,000 people in it. So we don’t do, we don’t, we only do 2 or 3 deals a month, but our average profit per deal is $71,000 per deal.
Rafael Cortez [00:03:01]:
Wow. Wow. Okay. So you’re— this is crazy. Normally, we have the context that real estate, you know, it’s a volume game, especially for real estate investments. If you’re looking at, you know, locking up deals as an investor, for the most part, we’re either, you know, either buying from wholesalers or you are, you know, hitting volume. So to be in a space that small, and really niche it out and have a consistent business out of that. I mean, that’s impressive.
Jay Conner [00:03:28]:
How do you do it? Well, I’m able to buy all my houses with all-cash offers. Now that doesn’t mean I don’t buy some houses on terms, like houses that don’t need many repairs or much rehab at all. I’ll buy those, subject to the existing note, you know, that kind of thing. But that only accounts for about 25% of our business. The other 75% is that we’re offering all cash offers. Well, you see, there’s nobody else around here consistently in our area that is able to make all-cash offers. And the reason we’re able to do it is because of private money. We make our offers where we can pay all cash, and close in 7 days on our offers.
Jay Conner [00:04:11]:
And, um, so, you know, there’s really no other competition like that around here that’s doing the business consistently and every day, every week, marketing, locating motivated sellers.
Rafael Cortez [00:04:23]:
I can’t imagine, right? I mean, from a kind of like taking a step back, I can imagine that in a population of $40,000, I mean, that’s your niche client or target client, right? It’s, I mean— Yeah, 40,000 people. 40,000 people. Yeah. You become an authority. I mean, quite fast if you are consistent in what you’re doing, right?
Jay Conner [00:04:50]:
Yeah. Like, you know, I looked at, or my team and I, I don’t have to go look at a house when you’ve got a great team, but my team and I have already looked at 3 houses this week. And all 3 of them came from referrals of either individual for sale by owners or realtors referring them to us. Cause you know, we’ve been doing it for so long here in the area.
Rafael Cortez [00:05:14]:
So I mean, that goes to show longevity, right? You’ve been doing it for a long, long time, and now the deals are just kind of trickling in because you’ve built that background, you’ve built that reputation. And I mean, I think at the end of the day, it really comes down to the brand, right? I mean, you have your brand, you are a brand at that. This time, by this time, I’m sorry, you are already a brand. You’re the buyer, the buyer for the area, for those 40,000 people. So, yeah, interesting. So, you started wholesaling,g and I kind of want to— what’s your background before you jumped into real estate and full-time in 2003? What were you?
Jay Conner [00:05:56]:
Doing? Yeah. Again, it was mobile homes, manufactured homes. That product is pretty much, you know, gone away. I mean, there’s hardly any manufactured homes or mobile homes going up and down the highway, you know, like there was. I mean, here in North Carolina, South Carolina, Georgia, and Florida, I mean, this whole Southeast area was the mobile home manufactured housing capital of the world. So, um, but I knew, uh, oh shoot, 10 years before we started flipping houses, I knew that we wanted to get into this business if we ever got out of mobile homes. So I’ve always been around, pretty much my entire career, helping people own a home. So like, you know, we sell a lot of homes on rent-to-own, and we actually, particularly if we buy on terms, um, you know, subject to the existing note or, you know, seller financing.
Jay Conner [00:06:47]:
So when we sell on rent-to-own or lease purchase, we actually help the buyer get into their credit repair and actually help them own a house, which, as you know, is pretty different from what a lot of other real estate investors do. So it all comes down to having a servant’s heart and doing our best to make an impact in the community
Rafael Cortez [00:07:10]:
It’s really, at the end of the day, we’re all solving problems, right? Like, that’s the biggest thing. Anybody who comes to us and is willing to trade money for speed or convenience thasa problem. They have a problem that we can come in and help them solve. So, I’m seeing a pretty interesting transition here. So, you started fixing and flipping in 2003. So, you started with mobile homes before then. And then, eventually, you start putting money together and then becoming this authority in funding, right? And just, you know, private money.
Jay Conner [00:07:46]:
And I’ll tell you what, I’ll tell you, Raphael, it was totally by necessity, by necessity. Really?
Rafael Cortez [00:07:54]:
So, elaborate.
Jay Conner [00:07:54]:
Yeah, from 2003. So, I mean, this leads to having the right mindset of a successful real estate entrepreneur. So from 2003 to 2009, the first 6 years we were in the business, we relied on traditional funding. We relied on banks, local banks, to fund our deals. I didn’t know any other way to fund deals those first 6 years. And in January, uh, Rafael, January of 2009, I had 2 houses under contract. Between these 2 houses, there was over $100,000 in potential profit. And so I called up my banker, and I’d been using the same banker for the, for those first 6 years.
Jay Conner [00:08:39]:
I called him up, and I’d had this conversation, Rafael, with him many, many times, and told him where the properties were located. They’re under contract. Here’s my purchase price. You know, funding is going to be in 30 days or whatever. And you know, we need to close by then. Well, I learned from that conversation, Rafael, and you hear where this conversation’s going, right? I learned during that conversation very quickly that my lines of credit were closed. I had no funding available, and I didn’t know that prior to getting my houses under contract. So I hung up the phone, and my first thought was, well, what am I going to do? Um, and you know, fear of failure is a whole lot more motivation than hope of gain.
Jay Conner [00:09:22]:
And I’m getting ready to lose over $100,000 in potential profit. So I called up a friend of mine whose name is Jeff. He lived in Greensboro, North Carolina, at the time. And I told him what had happened. I told him the bank had cut me off. I didn’t have any way to fund my deals. And I said, and he told me right there on the phone, he said, well, welcome to the club, Jay. My bank cut me off last week.
Jay Conner [00:09:47]:
And I said, well, what are you, what are you going to do? Well, I never heard of private money. And Jeff was the— Jeff, my friend, was the first person to even tell me that phrase of private money. And so I learned all about it, Rafael, and I put my program together. And so, you know, in this world of private money, there are no applications, there’s no approval process. I put on my teacher hat, and I started teaching people in my own warm market, my centers of influence, what private money is, and I started teaching them about self-directed IRAs. And do you know what, Rafael? To this date, I’ve never asked anybody for money. I’ve taught them what potential private lenders, individuals like you and me, I’ve taught them what private money is. And when they learn what private money is and what my program is that I’m paying for money, now they’re chasing me.
Jay Conner [00:10:41]:
I ended up with a problem very, very quickly. I had more money than I could put to work. On the properties, right? Yeah, that’s a, that’s a good problem. So, and so, so, so here’s my, here’s my takeaway from that life experience. When I hung up the phone from my banker telling me I had no more funding, I had a choice to make. I had a choice, and that is I could quit, or I could continue to pursue, seek, and find a better and faster and put me in the driver’s seat way of getting funding for my deals. So one of my mantras that I started saying in my head that very day when I was on the phone with my banker was, it is impossible for you to fail unless you choose to quit. Unless you choose to quit.
Jay Conner [00:11:38]:
I learned— I tell you, um, another mindset piece there, Rafael. I learned a very valuable formula from Jack Canfield. Jack Canfield, you know, is the co-author of the Chicken Soup for the Soul series from years ago, he and Victor Hanson. And I learned this formula from Jack Canfield. The formula is E, as in Edward, E R O. That stands for event plus your response to that event equals the outcome. E R O. And so the way— the way the— yeah, the way the formula— so with this formula, you are in control of your destiny because of the power of choice.
Jay Conner [00:12:21]:
So the event, the event that happened, may be something you created or attracted, or it may not be an event that you attracted or created. So the event in this example isthat I lost my lines of credit. I didn’t have any way to fund my deals. That was the event. I didn’t do— I didn’t have anything to do with that event. I had perfect credit. We made our payments on time all the time, but the event was outside of my control. But guess what? The outcome I was experiencing of losing that line of credit, for that moment in time, I didn’t have any way to pay all cash for my houses and those 2 that I had under contract.
Jay Conner [00:13:00]:
But guess what? I am 100% responsible for the choice and the, and the response that I give to the event that happened, right? So I can choose my response to the event that’s already happened, and therefore, when I choose my response, I’m able.
Rafael Cortez [00:13:22]:
To choose my outcome. I love it. You, uh, you answered, uh, one of the questions that I was going to ask you right now. Just, um, uh, I mean, you, you were going through some game-changer distress, at, uh, you know, during 2009. I was going to ask you, how did you handle that? Because I know a lot of people just went flat out of business, especially, uh, they have— they had stuff in the pipeline. I mean, we had the whole housing, you know, market just come down on, on, you know, everybody. And anybody who was holding, you know, the wrong way or leverage, I mean, really, really took a hit. So, so, I mean, but that makes perfect sense.
Jay Conner [00:13:58]:
E plus others equals— oh, I love it. There’s always, always huge, huge opportunities that come along because of difficulty. So me being, me being cut off from the banks back in 2009, I tell you, Rafael, that’s the biggest blessing in disguise that ever happened to us in our business was losing our funding. Because look, if it wasn’t for that adversity, I would not have had any motivation or any reason to go look for other, you know, kinds of funding. So as a result, I got really good at raising private money. And then here’s the deal, Rafael, that opened up a huge opportunity, uh, in 2011 after I’d been raising a lot of money for a couple of years. Then I started teaching other real estate investors how to raise money as I do. And I tell you, it just really puts you in the driver’s seat.
Jay Conner [00:14:55]:
As a matter of fact, if I hadn’t had that adversity, I wouldn’t be on your podcast today because that adversity led me to having all these years of experience attracting private money for my.
Rafael Cortez [00:15:10]:
Deals and for, you know, thousands of my students. Well, it kind of put you out of, you know, your regular orbit, right? It just knocked you into a different space, and you had to adapt, adapt, and overcome, right? It’s one thing that we always used to say at the fire department, like, yeah, you come across something different. That’s a challenge you adapt to and you overcome. And I mean, you did it marvelously. You really created a whole different, you know, pocket of opportunity for yourself by diving, you know, head-on into this, seeing.
Rafael Cortez [00:15:45]:
The need that was there, and then taking that to other investors. So you’ve consulted with over 2,000 investors, you know, at this point, and taught them about, you know, private money funding and and, you know, the strategy that’s allowed you to build this, you know.
Jay Conner [00:16:00]:
This, this great machine.
Rafael Cortez [00:16:01]:
Exactly.
Jay Conner [00:16:02]:
And, you know, like another huge opportunity in 2009, you remember all those properties were, I mean, the market was flooded with inventory of foreclosures, right? Right. But, but banks weren’t lending money. So, you had to have the cash to make offers and buy those foreclosures and bank-owned properties. So, it was like a vortex that came together. I had all this private money and had all these foreclosures coming to the market, so I could actually pick and choose, you know, which.
Rafael Cortez [00:16:39]:
Bank-Owned properties I wanted to do. Hmm. I, so it’s, I mean, this strategy, this strategy is really putting you in the forefront of opportunity, really. Like it’s, you’re leveraging something that wasn’t there before just by the, by the way you’re packaging it, right? So, can you teach us a little bit about private funding and the way that you see it, right? So you have private funding, and then you have hard money, which is not the same thing.
Jay Conner [00:17:06]:
Can you elaborate on that? Sure. So a private lender is an individual, a human being just like us, who loans money either from their investment capital or their retirement funds, and that’s a big one right there. We’ve got 40-some private lenders funding our deals right now, and over half of them use their retirement funds to invest and loan money to us. So, a private lender is an individual, and a hard money lender is typically a broker of money, a middle person that goes out and raises money from individuals, private lenders. And those private lenders invest with the hard money broker into their fund. And then the hard money lender or broker loans it out to us, real estate investors. Well, the way I do it and the way I teach other real estate investors is to circumvent the hard money lender or broker and go straight to the source, go straight to the individuals. So, do business with them.
Jay Conner [00:18:09]:
So there’s 3 main categories of where you find private money from these individuals. The first category is your own warm market, people that you’ve got some kind of association with. They’re in your cell phone, email, Facebook, LinkedIn, and your own social network. The second category is what we call our expanded warm market. You know, sometimes, um, a client of mine, a real estate investor, will say, well, my people are broke, my people don’t have any money.
Rafael Cortez [00:18:35]:
Well, first of all, I don’t believe—.
Jay Conner [00:18:38]:
I don’t— my cousins borrow from me. Yeah. Um, but I teach people how to grow their center of influence very, very quickly. Where do you go? I say the more money you wallow in, the more money sticks to you. Right. So how can you grow your center of influence? Then the third category is existing private lenders, individuals, um, that are already loaning money out. And a great place to find those people— now I’ve developed the private lender data feed. We get every existing private lender, uh, deal in the nation into our software.
Jay Conner [00:19:12]:
But another great place to go to network is to, um, self-directed IRA companies that have like, uh, you know, networking events. And 70% of their account holders are looking to loan money out to real estate investors.
Rafael Cortez [00:19:27]:
But back to the hard money and private lenders. So, and let me just— sorry to barge in, but, um, you said you put together a database, so you have a software that has a full database.
Jay Conner [00:19:41]:
Of existing private money lenders, right? That’s what I got, right? Yeah. So yeah, so that all comes from public records. The software goes out to the entire nation, every county in the nation, every month, and we get every private lender note. We get the private lender’s contact information, the interest rate they’re getting paid, the, you know, their loan-to-value, the range of loans, range of money, etc. And then we make that available, you know, to our clients. You know, I started out having our paralegal, my real estate attorney’s paralegal, search public records in our local area. But that was a very, very slow process, you.
Rafael Cortez [00:20:24]:
Know how to find those existing private lenders. And as you started to build that base, you just kind of expanded on it and then, um, you know, increase the network, right? Um, exactly, exactly. I didn’t mean to cut you off. Oh yeah, I didn’t mean to cut you off from the hard money. I just, I wanted to highlight the fact that you guys have a database because that’s, uh, very hard stuff.
Jay Conner [00:20:45]:
To get to it, you don’t have the right resources. Sure, sure, I appreciate that. So yeah, so the big differences between a hard money lender or hard money broker and doing business with individuals are, of course, number one, interest rate. You know, your hard money— during COVID, D hard money lenders shut down altogether. Hard money lenders weren’t even loaning any money, right? You know, right after COVID came along. Well, I had more money chasing me than ever before from, from private lenders. Well, the interest rate is high, so I pay our private lenders 8%. 8%.
Jay Conner [00:21:18]:
We can structure the deals so that we don’t even make any monthly payments until we sell the property and just let the interest accrue. And so, you know, hard money lenders now are between 12% to 14%. So the interest rate’s a big difference. There are no origination fees or points with private lenders. TThere arealways origination fees with hard money brokers and lenders. You know, a hard money lender is going to do 6 months or 12 months on the length of the note. Our private lenders do either 2 years or 5 years, depending on whether it’s retirement funds or investment capital. If you haven’t cashed out with the hard money lender, they may extend your note, but what do they want? More money, right? That averages, you know, 2%.
Jay Conner [00:22:06]:
Origination fees average 4%. So with a hard money lender, you’re already up to 20%. In the first year, I’m still at 8% with private lenders. Another big, huge distinction is when you buy a property, let me tell you what I love about private money. I always get a big check when I buy, when I buy, and bring no money of my own to the closing table. Right? So we always borrow more than we need to purchase the property. So I can borrow up to 150% of the after-repaired value. Right? So, um, the cash flow is just amazing, amazing with private money.
Jay Conner [00:22:43]:
So, as opposed to a hard money lender or broker, I gotta always bring.
Rafael Cortez [00:22:48]:
A check to the closing of either, you know, 20%. And you’re talking a big fat check,k too.
Jay Conner [00:22:53]:
So it’s not, it’s not a little one. Oh yeah. I mean, I’m bringing home $30,000 or $50,000 when I buy. I mean, who wants to get paid to buy houses, much less or much.
Rafael Cortez [00:23:04]:
More get paid again when you cash out.
Jay Conner [00:23:11]:
Exactly. Yeah.
Rafael Cortez [00:23:11]:
So, what are the— and I know you have a whole structure, right, behind setting up the, you know, or finding private funding. What are some of the top things that,t if somebody wants to, I don’t know, start looking for their own private funding to put together deals? You already gave us, you know, the 3 top sources of where people can find them. But what’s something, or what are the top 3 things, or maybe 5 things that somebody can look out for when?
Jay Conner [00:23:39]:
Putting private money together? Well, first of all, they need to have their private money program. Alright. So again, teaching potential private lenders, what’s your program look like? What’s the interest rate that you’re going to pay? How are they protected? You know, with all my private lenders, I don’t borrow unsecured funds; it’s always backed by a mortgage here in North Carolina, it’s a deed of trust. Mm-hmm. Um, you know, we always give the private lender, uh, insurance. So their name is the mortgagee on the insurance policy. Mortgagees get paid first in case there’s a total loss. Okay.
Jay Conner [00:24:13]:
So, you know, how can they get their money? Can they get their money back in case of an emergency? I give all my private lenders a 90-day call option. So if they need to call the note due early, they can. Gives me plenty of time to replace their private money with somebody else’s private money. And so, you know, my book that I just recently released goes into all the details of exactly what the private lending program is that you would offer. And of course, a lot of people duplicate that. So the first thing you gotta know is what’s your program? What’s your program? But even ahead of that, Rafael, even ahead of that, we got to get our— I tell people, unless you own the real estate in between your ears, it’s going to be hard for you to own any real estate out here, right?
Rafael Cortez [00:24:58]:
Yeah.
Jay Conner [00:24:58]:
So we got to get our frame of mind right and our mindset right. I’m not chasing, I’m not begging, I’m not selling. I’m actually teaching people what private money is and what my program is. And I teach them about self-directed IRAs. That’s a huge bit right there. I mean, that’s another thing to get in place first. Establish a relationship— if somebody wants to use private money, establish a relationship with a self-directed IRA company that you can refer your new potential private lenders to who have retirement funds, because they’re going to move those funds over to the self-directed IRA company, so then they can loan the money to you tax-free or tax-deferred for them. And penalty-free.
Jay Conner [00:25:47]:
So you want to get your program in place, which doesn’t take long, you know, to do at all. And then if you’re working in the warm market, you know, your own centers of influence, there are 5 easy steps to raising private money. Step number 1: make your list. Make your list. In my book, I go over in detail how you should make your list of potential private lenders with whom you have some kind of connection. A great place to start aispeople that are retired. If someone is retired, there’s a good chance they have retirement funds, right? And there’s a good chance they never heard of self-directed IRAs. They can earn an unlimited amount of money.
Jay Conner [00:26:30]:
We have one private lender who made $65,000 tax-free in one year.
Rafael Cortez [00:26:37]:
Wow. So yeah, so it’s like from turning.
Jay Conner [00:26:39]:
The authority is in their bank account. Yeah. Yeah, when they learn you can do that, it’s amazing. So number 1, make your list. And my book goes into all these details, but make your list. Number 2, you go down the list, and you just have a casual conversation over the phone or in person, uh, or you can invite people to a Zoom party. Uh, I’ve raised a lot of private money at private lender luncheons as well. I’ve raised almost $1 million at just one private lender luncheon.
Jay Conner [00:27:09]:
So step number 2 is a casual conversation. Now, in that conversation— and again, my book goes into the exact scripting of that conversation, it’s really simple— but we have what’s called the direct method, and then we have the indirect method. What I’m talking about is your call to action in your conversation. So in the direct method, if I’m talking with you over the phone and you’re a potential private lender, after a little chit-chat, I may say, Rafael, I’ve opened up. I’ve now opened up my real estate investing business to people that I know and trust. I’m paying insane high rates of return safely and securely. It’s only for people with whom I have a relationship. But Rafael, unless you answer yes to the following question, there’s no need for me to give you any more information. And that question is, do you have investment capital or retirement funds not giving you a high rate of return safely and securely? I call that the magic question.
Jay Conner [00:28:11]:
That’s a direct question. Now, when I started, I was a little intimidated to ask that question. So I use what’s called the indirect method. The indirect method involves a sample in this— in the conversations. These scripts are in my book. But these conversations, the indirect method, are a little chit-chat. I’m telling someone that I’ve now opened up my business to people by referral only. That’s a powerful phrase, by referral only.
Jay Conner [00:28:37]:
And the indirect method is just simple. The call to action is, help me get the word out. Here’s a very powerful phrase: I need your help. I need your help. People are created by God wanting to help other people. It’s just our nature. We want to help other people if we can. So I need your help.
Jay Conner [00:28:56]:
And here’s how I need your help. When you run across someone who’s complaining about the volatility of the stock market or complaining about getting a stupid 0.17% rate of return in a 12-month certificate of deposit, would you let them know that I have a program now that pays really, really insane high rates of return? Well, guess what? If they’ve got funds and retirement funds, now they want you to tell them.
Rafael Cortez [00:29:24]:
What your program is.
Jay Conner [00:29:26]:
Yeah, but you simply ask me, yeah, what about me? That’s how I got one of my first private lenders. I said, I need your help. I need you to help me spread the word. And so at the end of that conversation, he became my first $250,000 private lender because I simply asked him to spread the word. Right, that’s step number 2. Step number 3 is I’ve got a 16-minute audio titled Stress-Free Investing that, if someone’s interested, I email them or I text them the 16-minute audio. It just gives an overview of what private money is. It doesn’t spill the beans and teach my program.
Jay Conner [00:30:02]:
Step number 4 is I teach them my program exactly, you know, what the 15 items are as to how the program works, how you’re protected, and how you get high rates of return safely and securely. Step number 5 is that they’re going to give you a verbal pledge, and I never have to ask them for the money. By the time I get to the end of teaching them the program, the private money program, which only takes 15 or 20 minutes, they’re chasing me. They’re saying, well, how do I get started? I mean, if they’ve got funds, they can’t get this kind of rate of return anywhere else safely and securely. So here’s a really, really important point, and I’ll take a breath and let you ask me the next question. But here’s a really, really important point. Never teach your private lending program and try to pitch a deal to the, to a private, to a potential private lender in the initial conversation. You already sound desperate.
Jay Conner [00:30:54]:
You’ve already compromised your position. We only want to teach the program. They give us a verbal pledge on how much money they have to loan. Do they have retirement funds? I need to introduce them to my self-directed IRA company. Now that they have verbally pledged how much they got, guess what? Now I’ll go find a deal ASAP, and I’ll call them up. I’ve never sold or pitched a deal, Rafael. I call them up, and I tell them 4 things. After a little bit of chitchat, I say, I got great news for you.
Jay Conner [00:31:22]:
I can now put your money to work. I got a house in Newport with an after-repaired value of $200,000. Uh, the funding required for the deal is $150,000. Closing’s next Thursday. Uh, you need to wire your funds to the real estate attorney’s trust account by next Thursday. End of conversation. I didn’t ask them if they wanted to do the deal.
Rafael Cortez [00:31:43]:
That’s the most stupid question I could ask them.
Jay Conner [00:31:46]:
Yeah. They’ve already said it before. Yeah.
Rafael Cortez [00:31:48]:
Yeah.
Jay Conner [00:31:49]:
I mean, they’re, they’ve been waiting on the phone call for our first deal. Right. So it’s important to.
Rafael Cortez [00:31:58]:
Do that one step at a time. I like the methodology that you have behind it, and I think it’s a golden nugget what you’re saying right there. Do not pitch the, uh, the deal at the same time you’re asking for money. I mean, it’s kind of like, yeah, it’s a desperate move. It really is. Um, and, uh, you need to, you need to project confidence when you’re asking, you know, people for their money because you’re going to put it to work. Um, it comes, you know, into a into preparation, right? Like, if you’re prepared, you have to prepare ahead of time for when the opportunity shows up. I love it.
Rafael Cortez [00:32:35]:
You mentioned the book, the— everything— what’s the name of the book that you, you wrote?
Jay Conner [00:32:39]:
And I have it, I have it here. But I just recently wrote it. The name of the book is Where to Get the Money Now, Where to Get the Money Now. And the subtitle is How and Where to Get Money for Your Real Estate Deals Without Relying on Traditional or Hard Money Lenders. And this book goes into detail, step by step,p exactly how I’ve done it, how I still do it, how thousands of my students across the nation do it. And, uh, Rafael, I would love to give the book— it’s $20 or $19.95 at Amazon— but I’d love to give the book to your audience, uh, if.
Rafael Cortez [00:33:17]:
They would just cover shipping, just cover shipping. Wow, that’s amazing. Thank you. You’re spilling the beans on that book in terms of how to find the private money. And I appreciate that, man. I think that’s a huge, huggiftve for my audience. Guys, if you’re not taking this just for the cost of shipping, you’re crazy, especially if you’re doing real estate investments and you’re trying to get deals done, come in and buy them, and use hard money. Just one of those things that is really beyond a strategy.
Rafael Cortez [00:33:53]:
I mean, I think it goes far beyond that because it really edifies your business, right? You are the buyer now, and youcano reach out and then get things done. A lot of times, hard money lenders have, okay, I got to appraise the property, I got to do this. They have things and red flags and stuff that they have to go through when private money lending is It’s different. It’s a totally different game. And when you know how to do it the right way, which is what you have, I mean, it’s a, it’s a.
Jay Conner [00:34:24]:
No-Brainer. So yeah, thank you. How can people get it? I got a special website where your folks can get the book. Oh, spill it. Let’s— Yep. So the special website for your audience to get the book, the book is free, just cover shipping, is www. JayConner.com/freebook. F-R-E-E-B-O-O-K, Jay Conner with an E-R, jayConner.com/freebook.
Rafael Cortez [00:34:56]:
And I’ll autograph it, and we’ll ship it right out. Beautiful. I’ll make sure to have thatinn the show notes as well. So people can just click on it and go straight to it. So if you’re listening to the podcast right now, on iTunes, or you’re watching on YouTube, make sure that you hit up that link and just do it right now. I mean, take advantage of this. It’s really good information. It can set you up for the next several deals that you have in the pipeline, maybe even shift the overall course of your business.
Rafael Cortez [00:35:21]:
So private money is one of those big, big things that people are often intimidated by. And I think it’s usually because there’s a lack of clarity and understanding as to how the whole thing works. But if you have that, the rest is just action. It’s just, you know, applied action. That’s what it is. Um, Jay, thank you so much. I, I think I mean, you, you’ve, uh, dropped a lot of golden nuggets, uh, and I clarified a lot of things that I myself was questioning about, uh, how to do private funding. I mean, I do work with a couple of private funding, private money partners, but those are relationships that I’ve had, you know, for years, right? I’ve never had to go out there and actually just, you know, break into different private, you know, money— private money providers, per se, and have those conversations.
Rafael Cortez [00:36:11]:
And I really— if I try to put it together and just collect a whole bunch of cash from people I don’t know, I wouldn’t know what to do. I wouldn’t know what step one is. I’m lucky enough to have a close network that I can reach out to, but that’s a whole different thing, right? Not everybody has access to something like that. So this is something huge, and I appreciate you putting it out there for us. For us. Um, Jay, if somebody wants to get a hold of you, maybe reach out, have a conversation, find out more about your coaching, maybe, uh, perhaps, or, or, uh, just, you know, ask you a couple of questions, where’s the best?
Jay Conner [00:36:42]:
Place to reach you? Sure. Well, I’ll give my website, my general website, and then we actually answer the.
Rafael Cortez [00:36:48]:
Telephone at my office.
Jay Conner [00:36:50]:
What? No, you don’t. Stop it. So you can actually put my telephone number in the show notes if you like. So yeah, they can just go to jayconner.com, J-A-Y-C-O-N-N-E-R.com. And our phone number is 252-808-2927, 252-808-2927. And yes, I love, I’m passionate about making an impact with other real estate investors. And any of your audience is welcome.
Rafael Cortez [00:37:18]:
To pick up the phone and just give us a call. Beautiful. Thank you so much. Very, very appreciative of that. I have one question that I’d like to ask before, before we sign off. And that’s, if you were walking down the street, and you ran into your 17-year-old self, what would you ask that young Jake Conner?
Jay Conner [00:37:39]:
Or what would you tell him? Yeah, even at 17 years old. So yeah, when I was 17 years old, I didn’t even know what a mentor was. I mean, I was going to college, but it just never occurred to me until many, many later and many, many later. As to how much— actually, two pieces of advice. How much is getting a mentor who is in a career realm of a career that you want to get into? Well, get a mentor and start working with someone who’s already, you know, proven themselves and has already been very, very successful at what you want to do. And that doesn’t just apply to real estate investing. I mean, that’s anything, you know, hang around the people that are already successful. And my other piece of advice is that when I was 17 years old, I never heard of masterminding.
Jay Conner [00:38:36]:
You know, masterminding and mastermind groups, actually, that phrase was coined, I’m sure you know, by Napoleon Hill all the way back in the book Think and Grow Rich. And so, you know, you and I are in a mastermind group together. I’m actually in 3 mastermind groups. And the benefit of that is hanging around like-minded people who are interested in what you’re interested in. And so that’s really two different ways, and I do both, to surround yourself with people that you want to be like. You know, what’s his name, Jim Rohn, is credited with the saying, you are the average of the five people you spend most of the time with. So if I were talking to my 17-year-old self, Be very selective and intentional.
Rafael Cortez [00:39:27]:
About who you spend most of your time with. Wow. Wow. That’s, that’s gold right there. That’s golden. And yeah, you’re completely right. I mean, masterminds, I know they have changed the course of my business and my mindset altogether. Big shout out to, to Matt Andrews for putting together Family Masterminds.
Rafael Cortez [00:39:47]:
I mean, he’s done a stellar job there. I mean, just putting in all kinds of great, great people. Every time I walk into that room, uh, I, I feel like I’m, I’m the slowest one in the room, and I think that’s a good thing. I think that’s a very good thing.
Jay Conner [00:40:00]:
I like to— yeah, I mean, I.
Rafael Cortez [00:40:01]:
Want to be around people who are better than me. Yeah, yeah. Jay, thank you so much. It’s been a total, total pleasure having you. I know you’re a busy guy, and I appreciate you taking the time, uh, to sit down with us and just, you know, clarify, you know, everything that you have, um, in terms of private funding.
Jay Conner [00:40:21]:
And of course, thank you so much for having me.
Rafael Cortez [00:40:23]:
It’s been a blast. So much for having me, team. There you have it.
Rafael Cortez [00:40:53]:
It’s a wrap. Stay focused. You got this.
Narrator [00:40:53]:
Are you feeling inspired by the knowledge you gained in this episode? Then head over to wwwJayConner.com/moneyGuide. That’s wwwJayConner.com/moneyGuide and download your free guide that shares 7 reasons why private money will skyrocket your real estate investing business right now. Again, that’s wwwJayConner.com/moneyGuide to get your free guide. We’ll see you next time on Raising Private Money with Jay Conner.