Attracting private money is critical for real estate investors, yet the process can seem intimidating, especially for those just getting started. In a recent episode of “Raising Private Money,” Jay Conner, together with several mastermind members, shared powerful insights and practical strategies that demystify the process and highlight the true keys to success.
Focus on Service, Not Convincing
A common stumbling block for new investors is the idea that you need to convince private lenders to invest. Crystal immediately reframed this notion, emphasizing that the goal isn’t to chase or persuade anyone. Instead, she explained that building relationships through education and serving is the heart of attracting private money. When you stop chasing and start focusing on teaching others about the opportunity and protecting their interests, you naturally become someone lenders trust—and want—to work with.
You Don’t Need Years of Experience
Lack of experience is one of the main worries for new investors. Chaffee addressed this by explaining that even those who haven’t closed a single deal can successfully attract lenders. The secret lies in using a proven system—like Jay Conner’s—that offers structure, safety, and clarity for both parties. By plugging into experienced mentorship, utilizing transparent systems, and leaning on the credibility of mentors and team members, even a brand-new investor can present themselves with confidence. This collaborative approach allows lenders to feel secure, knowing there is a knowledgeable team supporting each deal.
Private Lenders vs. Bank Financing
The panel also touched on the difference between relying on banks and developing relationships with private lenders. Scott pointed out that banks can pull their approvals unexpectedly, derailing deals and business growth. Private lenders, on the other hand, offer flexibility and speed, especially crucial in a competitive or tightening market. The panel stressed that nurturing a small group of reliable lenders is the true “secret sauce,” offering investors security and a powerful edge.
Real-World Prospecting Tactics
One of the mastermind members, Jeff, shared real-world tactics he’s used to find and attract private lenders. He started by reaching out to known private lenders via email and letter, proactively introducing himself to people at church, joining local investment and Christian organizations, and speaking at community events. His approach centered on teaching people how private lending works and demonstrating how it could benefit them, rather than just pitching for money.
Chaffee expanded on this, emphasizing the importance of being visible and broadening your network. He recommended joining networking groups like the Rotary Club, Business Network International, or local business organizations to meet and serve more people. Getting involved and being genuinely helpful establishes credibility and attracts referrals naturally.
Build Relationships with Community Influencers
The panel recommended going a step beyond general networking and building connections with key influencers in your community. Scheduling coffee or lunch with attorneys, CPAs, or local government officials—not to sell, but to learn about their work and share yours—positions you as a connector and resource. As you develop these relationships, your reputation grows, and people begin to talk about you and recommend you to others. That’s when you shift from seeking lenders to attracting them.
Make Consistent and Persistent Action Your Habit
Jay Conner rounded out the discussion by emphasizing the core takeaway: consistency and persistence. It’s not enough to take sporadic action—you need to show up, network, educate, and provide value on an ongoing basis. Make a clear, intentional plan for what activities you’ll do every week to grow your list of private lenders and follow through, no matter the immediate result. Success in this business comes from persistent effort and building a reputation as a knowledgeable, helpful leader.
In Summary
Raising private money isn’t about slick sales tactics or years of experience. It’s about consistent relationship-building, education, and serving others. Focus on becoming an expert resource, connect with your community, and take small, persistent actions every week. Over time, your efforts compound, and the right private lenders will seek you out—helping you skyrocket your real estate investing success.
10 Discussion Questions from this Episode
- What are some actionable steps you can take consistently and persistently to attract private money, as emphasized by Jay Conner?
- According to Crystal and Chaffee, what are the key differences between syndication and using separate notes for each private lender on a deal?
- How do you determine the ideal number of private lenders to involve in a single project, and what are the potential drawbacks of including too many, based on the conversation between Crystal and Chaffee?
- Why do Crystal and Chaffee stress the importance of serving and educating potential private money lenders instead of “convincing” them?
- What role does having a proven system or process play in attracting private lenders, even for new investors, according to Chaffee?
- How can leveraging bank money (e.g., through HELOCs) be used to make money in real estate, and what cautions did the speakers, especially Chaffee, suggest?
- Jay Conner and Crystal discuss the importance of asking the right questions when raising private money. How can shifting your focus from “finding” to “attracting” private lenders impact your results?
- Why is setting up a trust account not essential for attracting private lenders, as explained by Jay Conner?
- What networking strategies did Jeff share to expand his pool of potential private lenders, and what additional suggestions were given by Chaffee?
- According to the episode, how important are consistency and persistence in the process of raising private money, and what practical activities did Jay Conner and others recommend to support these qualities?
Fun facts that were revealed in the episode:
- Single vs. Multiple Lenders
Having multiple private lenders on a single real estate project isn’t as complicated as many think. Each lender can have their own separate note and deed of trust or mortgage, listed in priority order (first, second, third position, etc.), and there’s actually no legal limit to the number of private lenders you can have on a project—though working with fewer is often easier and more cost-effective. - No Convincing Required
A key philosophy shared is not to “convince” anyone to lend you private money. Instead, the approach is about educating, serving, and presenting opportunities—so lenders come to their own conclusions without any pressure. - Consistency is King
Consistently and persistently taking action is highlighted as the secret sauce to attracting private money. Whether it’s networking, educating potential lenders, or building relationships with community influencers, the most important question to ask is, “What am I doing consistently and persistently to attract private money?”
Timestamps:
00:00 Managing investor contributions
04:44 How Jay’s system works
08:58 Using private lenders for success
11:21 Finding and attracting private lenders
16:29 Importance of networking skills
17:19 Building relationships for referrals
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The Power of Education and Service in Private Money Investing
Jay Conner [00:00:01]:
What am I doing consistently and persistently to attract private money? So it is with intention. What is your plan? What are you, what actions, and actionable activities are you doing consistently and persistently? The list is long to choose from as to what you can be doing to attract, you know, the private money. But it’s got to be consistent and persistent.
Narrator [00:00:39]:
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 to raise 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.
Crystal Baker [00:01:06]:
Like we got Mark, who says, ” How do you handle multiple lenders on one project? Do you file one mortgage deed of trust or one for each private lender? Is there a limit to how many private lenders can be on one project? How do you avoid registering it with the SEC when you have multiple private lenders on one note? It’s a lot in one question. Mark. I love it. It’s a great question.
Chaffee-Thanh Nguyen [00:01:28]:
There were like 10 questions.
Crystal Baker [00:01:30]:
I think it was the simple answer. Mark is, as Jay would say, these are single, single-family houses. You’re doing one-offs. So you’re going to do a single note for each lender. So you are not creating a. My brain just left me syndication. Thank you. The word was gone all of a sudden.
Crystal Baker [00:01:52]:
But you’re not creating a syndication. You’re not, you’re not putting any of these or pooling these funds. You’re putting them all on separate notes. So how do you handle that? You put them in order, and they are identified as such. So you have to say they’re in first position, second position, third position. How many can have as many as you want? I wouldn’t recommend having a million because you have to pay for each of those positions. You have to pay to have the documentation done. You are going to have to pay interest on that at some point.
Crystal Baker [00:02:20]:
It doesn’t make sense. So the numbers have to walk you through what you’re going to put in there. But there’s no limit. And you don’t have to file with the FCC because it’s a one-off; it’s a note, promissory note, deep trust, or mortgage on a piece of property, real property, for each person, each lender. Anything you want to add to that? Chaffee?
Chaffee-Thanh Nguyen [00:02:42]:
Yeah, I was just going to say that’s key. Too, is that while there is no limit to the number that you put on, you should keep in mind that, for example, if you’re paying your attorney 500 bucks for, for each person, right, for paperwork, which, you know, initially, it might be more, but if you work with your attorney for a while, it might be, you know, less. It’s. But let’s just say 500 bucks for their work,k, and you have, you know, you need a hundred thousand dollars, and you get $10,000 from 10 people, you know, that adds up, right? Ten times 500, that’s $5,000. So if you can find one or two people with, you know, a hundred thousand or 50,000 each, that’s gon do much better for you mentally as well, because you have to track all 10 people as well as pay interest and all that. So all that fun stuff. So, you know, just keep it. I know Jay has, for bigger projects, you know, done three, four, and sometimes five on a rare occasion, but usually it’s one or tw,o and sometimes three is where you want to keep that at.
Chaffee-Thanh Nguyen [00:03:41]:
S, and since you’re not pooling funds and you are collateralizing the funds, then you are under the SEC radar, which means that they are not looking at you, right? If you’re doing a syndication and not collateralizing, or you’re doing some kind of raising money and not collateralizing those funds, then the SEC will get on your case. So be careful about that.
Crystal Baker [00:04:05]:
So, grassroots question. If I have not done any deals, what can I say to a potential private money lender to convince them to invest with me?
Chaffee-Thanh Nguyen [00:04:17]:
That is always a great question.
Crystal Baker [00:04:20]:
Convince is a terrible word. We’re not convincing anybody. We’re not chasing, we’re not begging. We’re not trying to get anyone to do anything. We are just teaching and serving. So if you learn nothing else today, please walk away with that message. It will serve you as you’re trying to serve others. Don’t ever try to convince anyone of anything.
Crystal Baker [00:04:42]:
Go ahead, Chaffee.
Chaffee-Thanh Nguyen [00:04:44]:
Here’s the quick answer. And the quick answer is that when you have a system such as Jay’s put together and the way that we deliver that system and share that system with individuals and teach them and educate them about private money, as Crystal said, there’s no convincing, right? It’s just that this is how the process works. This is how the system works. Here are all the protections in place for you and for your money, and here’s how we operate. And so the system and the process that Jay’s put together does all the talking and educating, and they come to their own conclusion of what to, what to invest with you and when and how much. And so again, there’s no, it doesn’t really matter if you’ve done deals or haven’t done deals. We have worked with Jay and the team, have worked with people who are brand new, have never even started real estate investing, to people who have done over 200 deals and come into the Jay Conner world of investing. And so now I will also add to that that once you do start working with us on one of the mentorship programs, you always have a huge team of people, Crystal J, myself and all the Mastermind members and Platinum plus members to lead upon as your partners and to be able to get Jay on the phone as your partner and have him talk to your potential private lender or potential seller is huge.
Chaffee-Thanh Nguyen [00:06:11]:
And so, you know, there’s always that option as well, which is to lean on somebody else’s credibility and use their, their experience if you don’t have your own. And again, the quick answer is that when you’re using a system that has all the protections in place, that’s what people are looking for to feel safe and secure in order to invest with you.
Crystal Baker [00:06:30]:
Oh yeah. So the other piece of the question was how one can make money using a bank’s money?
Chaffee-Thanh Nguyen [00:06:35]:
Well, that’s kind of a wide-open question that can be answered in multiple different ways.
Crystal Baker [00:06:43]:
Yeah, I mean I think the easiest way to answer it is it’s kind of like anything else you evaluate has to make sense for what’s the interest rate look like, what are your payments, what’s your carrying costs, what’s the time of the length of the note, can you get the project, you know, figure in all the variables and then that’s how you make money. You have to make sure that you clear more substantially than what it is. So plug in all the data like Jay teaches and compare that when you’re borrowing the money from a bank versus, you know, if you were to do stuff from a private lender. So there is money that can be made using a bank, by the way, it’s not impossible. It is very different, though. The timeline is different, and the number of things you have to qualify for is very different. It’s a very different experience. But it can, you can make it work.
Crystal Baker [00:07:34]:
It just wouldn’t be the primary teaching because it’s not the easiest way to get things done. And obviously, you’re then not helping your potential private lenders because you’re not investing their funds, and so you’re not able to provide service. Many people.
Chaffee-Thanh Nguyen [00:07:48]:
Here’s a great way though, and just, you know, we teach this all the time, is that if you find somebody that has grade A credit or, you know, has a house and they’re able to get what we call a HELOC or a home equity line of credit on their property at a very low interest rate and they are willing to lend that to you as a private lender. So let’s say they get a HELOC for, you know, 5% on their property,y and they could borrow $100,000 on their property and lend that $100,000 to you at 8%; they’re going to make a 3% spread for using bank money. Right. And so there’s a simple way of doing it as arbitrage. Right. You’re using the bank’s money to make money, and it doesn’t cost you a dime because most HELOCs don’t cost you anything. So there’s, as you know, the bottom line is that if you can make more money than it costs to borrow money, then you can, you know, make money from the bank. Right.
Chaffee-Thanh Nguyen [00:08:43]:
And you just have to be careful of making sure you pay all that money back. So whatever you do in a timely manner or on time, it’s due. Crystal, do we have another one?
Scott Paton [00:08:54]:
Chaffee, can I just chime in on that one?
Chaffee-Thanh Nguyen [00:08:57]:
Sure.
Scott Paton [00:08:58]:
Before you move on, it’s like my, my response would be, why? Why would you do that? And I think people get, they get something, an idea in their head, and then they feel like they want to do it that way. But you know, we have a proven system and it frees you from going into a bank one day and having the guy that you talk to all the time say I’m sorry, like we’re not sending you, we’re not giving you money for your deal, which happened to Jay, you know, a while back and which changed the whole direction of his business and made it far more successful. Right. So I would really like to ask, like, why are you concerned about, like, what? There must be some reason, you know, and you need to deal with that because otherwise you’re going to keep going back to it. But it’s a loop that is not really going to bring you the success that, that you want. You know, having a small group of private lenders that you can pull money from quickly to do deals is the, is the secret. Right. Particularly when the markets get poorer because everybody gets more desperate, and those that have money, you know, anyway, I just, it just struck me as like the wrong Question to ask.
Scott Paton [00:10:17]:
And a lot of people who teach success tell everyone. Tell you, you know, you need to ask the right questions. So I just wanted to throw that out.
Chaffee-Thanh Nguyen [00:10:25]:
So the question is, what challenges are you having with raising private money? And somebody posted. Bill posted. I set up a trust account with a company. Okay. And having trouble finding investors.
Jay Conner [00:10:38]:
Let me give this comment first, Chavy. I want to make this clear for everyone. You don’t set up a trust fund to borrow private money. Now. Now you can have, you know, you can have a land trust on each property. My entity structuring is using an LLC for my buy-and-hold properties and then an LLC for my flips. But there’s a disconnect in my mind about setting up a trust fund, and then I can’t find private lenders to. That’s like Apple.
Jay Conner [00:11:21]:
That’s like apples and oranges. Having a trust fund has nothing to do with attracting, you know, private money from private lenders. So I just want to get it clear for everybody. Don’t worry about having some kind of trust fund set up because that’s got nothing to do whatsoever with attracting private money. Now, when it comes to having trouble finding private lenders, the list or the answer to that could be as long as the reasons why they’re having trouble finding private lenders. So without them there, I mean, if they were here, I would need to ask some clarifying questions. And the biggest one is, well, what have you done to attract private lenders?
Chaffee-Thanh Nguyen [00:12:13]:
You know, that was a key. A couple of things. First of all, as you said, setting up a trust has nothing to do with raising private money. That’s why I skipped over it, because it has nothing to do with it. But secondly, you know, the key that you said, Jay, which was what have you done to attract private lenders, versus the question, which is, I can’t find any private lenders. Right. And there’s a big difference between attracting people and finding people. But regardless of that, you know, diving into what some challenges are in finding, searching, or attracting private lenders.
Chaffee-Thanh Nguyen [00:12:50]:
Does anybody else here? On that challenge, like you, you have tons and tons of people you can talk to, so this is not an issue. Jeff, you have that challenge, right? You want to unmute and, you know, go back to what Jay just shared with the group again- what you’ve done so far to talk to private lenders.
Jeffrey Jackson [00:13:12]:
Yes, absolutely. Through the recommendations of the team here, I’ve gone out, and I have started sending individual emails or mails out to known private lenders. To be able to introduce myself. I have taken a more assertive approach with others that I come in contact with, to be able to introduce myself as someone who can educate them on how that they would be able to get better returns on their investments than where they’re at today unless they’re doing extremely well and just making myself more available to try and serve others and give them my life experience as to what I’ve experienced as being a personal private lender so that that can help encourage them.
Chaffee-Thanh Nguyen [00:13:55]:
Good. And where have you gone to talk to people?
Jeffrey Jackson [00:13:59]:
Mainly at church. I’ve also got investment groups that I am a part of, and I have. I go to meetups,s and I’ve also got a Christian organization that I’ve got an appointment with that we’re going to have a meeting in the next month, so I’ll be doing it there as well.
Chaffee-Thanh Nguyen [00:14:15]:
Awesome. So you’ve gotten, you’ve gotten the word out, and you’re starting to spread the word out, then?
Jeffrey Jackson [00:14:19]:
Yes, sir. Thick as I can.
Chaffee-Thanh Nguyen [00:14:22]:
Good. And so, you know, where else might you be able to find more people to talk to?
Jeffrey Jackson [00:14:28]:
Well, I would. I’m assuming that in the near future, I’ll be looking at joining the business network, international groups in my local area, perhaps experiencing or expanding into the Rotary Club, or other civic organizations, where I might be able to plug in and find a place that I can serve and see what I can do to help them.
Chaffee-Thanh Nguyen [00:14:48]:
Awesome. So. So I guess that’s the answer right there. For a lot of people, if you haven’t done half of what Jeff has done, you know, do what Jeff is doing first. Right. So great job getting out there, Jeff. And secondly, getting out there, more is key, and sharing that information more is critical as well. So many, many different ways of getting the word out there. Crystal, anything you want to add to that?
Crystal Baker [00:15:12]:
No, I just want to like. Well, I want to encourage others. So if there’s anybody else that’s been looking and, and you know, you feel like you’re out there searching and not finding, and, and as we say, you should be attracting, sharing, and serving. But if you haven’t, then what would be your challenge, or what have you done already? If you, if you would be willing to share. But I just wanted to give a shout-out to Jeff because Jeff did indeed very much take our instruction, and he took advantage of an opportunity to have a conversation and didn’t lean on other things or ways to get out of the conversation. He went straight into who he was,s who he serves, and what it meant to him, and created a different kind of connection than previously was there. So super important. And that’s what happens.
Crystal Baker [00:16:01]:
And that’s the magic, because it’s. It sounds like a kind of magical connection. Now there are more opportunities that weren’t previously there. That’s the magic that happens when you start introducing yourself as the expert in this space, as the educator, and are there to serve. So I just wanted to give a shout-out, Jeff, based on what you had shared, which, to me, was really important, and you’ve taken some great strides.
Chaffee-Thanh Nguyen [00:16:29]:
Let me just add, while we’re on this topic, Crystal, at the live event and in the mentorship and everything, we talk a lot about networking. We talk a lot about getting out there and talking with people, meeting people. And the real purpose of networking isn’t just to go out and pass a bunch of business cards or brochures or just say, ” Hey, what’s up? And have a good time. It’s to build relationships. It’s really about getting to know people, providing value, and seeing how you can help them. And so, one thing, taking this a step further, Jeff, I don’t know if you’ve done this, and this is for everybody there as well, is scheduling time to meet with certain key influencers in your community, in your network. Right. So, you know, what brings it up? As Lisa talks about, you know, she has a cpa.
Chaffee-Thanh Nguyen [00:17:19]:
So, Jeff, have you scheduled time with your CPA and say, ” Hey, can I talk to you about what I do and get more about what you do so that we can refer more people to each other? Right. Scheduling time, having a cup of coffee with an attorney, or getting to know some of the key influencers in the local government. Right. And saying, hey, this, you know, I’d love to get to know more about what you do, so maybe that we can, you know, refer business. And so, you know, the power and the strength of getting to know people so that you can refer people. And being a connector in the community is where you start getting referrals, and as Jay says, start attracting people. Right? Because now these key influencers will start talking about you when they’re out networking as well. And so I’ve had that happen with me many a time, where I will get people coming up to me randomly that I’ve never met and say, ” Oh, I heard about you from so and so, or I heard about you at this event or whatever, and they’ll just introduce them to me because they heard about me from other people.
Chaffee-Thanh Nguyen [00:18:18]:
And so that’s the level, that’s the point you want to get, and you get there by again building those relationships with some of the key influencers in the community.
Jay Conner [00:18:26]:
Yeah. Let me share two keywords for Jeff and everybody. And here’s the question to write down. What am I doing consistently and persistently to attract private money? So it is with intention. What is your plan? What are you, what actions, and actionable activities are you doing consistently and persistently? The list is long to choose from as to what you can be doing to attract, you know, the private money, but it’s got to be consistent and persistent.
Narrator [00:19:13]:
Are you feeling inspired by the knowledge you gained in this episode? Then head over to www.JayConner.com/MoneyGuide– that’s www.JayConner.com/MoneyGuide, and download your free guide that shares seven reasons why private money will skyrocket your real estate investing business right now. Again, that’s www.JayConner.com/MoneyGuide to get your free guide. We’ll see you next time on Raising Private Money with Jay Conner.