Most real estate investors are conditioned to believe that the only way to acquire properties is by jumping through endless hoops at the bank—endless forms, strict qualifications, and a constant hope of approval. The system is built on barriers, and for many, it becomes the greatest obstacle standing between them and financial freedom.
But what if you could sidestep the banks entirely? What if you could build a portfolio from scratch, even if you’re strapped for cash or have imperfect credit? In a recent episode of the Raising Private Money podcast, Jay Conner welcomes financial activist and Seller Financing Academy founder Mel Dorman, who has done just that. Here’s what we can learn from her journey—and why seller financing may be the tool every investor is missing.
Moving Beyond Bank Limits
Like many beginners, Mel Dorman started with traditional financing. Her first deal was a classic “house hack”—an FHA duplex with 3.5% down. That left her with an empty savings account and only one option: figure out a new way to buy more properties. Around this time, inspiration struck as she started networking with other investors.
After a personal turning point—the passing of her father and leaving her job as a social worker—Mel Dorman threw herself into learning seller financing. She went all in with just $16,000 in her account, cold-calling, knocking on doors, and relentlessly searching for off-market deals.
The Power of Seller Financing
Seller financing means the seller acts as the bank—you pay them over time, often with more flexible terms than a traditional lender could offer. For Mel Dorman, building relationships was key.
Rather than pitching “seller financing” as technical jargon, she listens for the seller’s pain points—maybe they want to travel, avoid a large tax bill, or simply stop being a landlord. She then frames seller financing as a solution to their actual problems.
The Multiple Levers of Negotiation
Traditional deals focus almost exclusively on price. Seller financing, on the other hand, opens up four negotiable “levers”: price, down payment, interest rate, and loan term.
This flexibility allows you to create win-win scenarios. Sellers save on taxes, receive steady income, and avoid the headaches of property management. Buyers lock in better cash flow, take over valuable properties, and bypass the gatekeeping banks.
Who Are the Ideal Seller Financing Candidates?
Many may wonder: Who is actually willing to do seller financing? You might be surprised:
- 4 in 10 homeowners (and two-thirds of seniors) own their property free and clear—a vast pool of potential candidates
- Tired landlords, retirees downsizing, and owners moving to lower-cost areas are often eager for a steady, secure return
Finding these sellers means thinking creatively—using tools to identify free-and-clear properties, direct mail, cold calling, and thoughtful follow-up.
Combining Seller Financing with Private Money
Not only does seller financing unlock deals, but you can structure them to use Private Money for down payments—creating virtually limitless buying power. Mel Dorman structured her first deal this way, raising funds from friends for the down payment while the seller carried the rest—proving you don’t need deep pockets to get started.
Take Action—Flip the Script
If you’re stuck chasing funding and waiting for bank approval, seller financing offers a path to break free. As Jay Conner closes the episode: “Applicants don’t build wealth. They ask for permission. What you just heard in this episode is how real players… operate. Seller financing, Private Money, no begging, no approvals, no gatekeepers—just strategy.”
Rethink how you approach your next deal—start with service, creativity, and genuine conversation. The result could be the breakthrough your portfolio (and your life) has been waiting for.
10 Discussion Questions from this Episode
- What prompted Mel Dorman to transition from traditional financing to focusing exclusively on seller financing, and how did her personal experiences shape this shift?
- In what ways does Mel compare initiating a seller financing conversation to the process of dating, and what lessons can real estate investors draw from this analogy?
- What are some of the key “green flags” Mel looks for when evaluating whether a seller might be a good candidate for seller financing?
- How does Mel structure her conversations with potential seller financiers to prioritize their needs and concerns, and what specific language does she use to keep the conversation relational rather than transactional?
- What are the main benefits of seller financing to property owners, especially those who have owned their property for a long time?
- Why does Mel emphasize the importance of focusing on the monthly payment and cash flow rather than just the purchase price when structuring a seller-financed deal?
- How can Private Money be combined with seller financing in a single transaction, and what advantages does this combination provide both the investor and the seller?
- What marketing and outreach strategies does Mel recommend for finding property owners who are ideal candidates for seller financing?
- In what ways does Mel ensure her deals remain win-win situations for all involved parties (herself, the seller, and private lenders), based on examples she shared?
- Reflecting on Jay Conner’s closing thoughts, what barriers do you believe prevent most investors from pursuing alternative financing strategies like seller financing, and what can be done to overcome those barriers?
Fun facts that were revealed in the episode:
- First Seller-Financed Deal Was a “Kismet” Moment
Mel Dorman’s very first seller-financed property came from a chance connection with a bankruptcy attorney, who announced during the property walkthrough that he specifically wanted to sell via seller financing—turning Mel’s months of daily affirmations and outreach into real-world success. - $500 Out-of-Pocket to Multimillion-Dollar Portfolio
On her first major triplex purchase, Mel put down only $500—leveraging creative financing and Private Money—yet she turned this into a cash-flowing investment, kickstarting a multimillion-dollar real estate portfolio built in just five years. - Older Homeowners Hold the Key
Contrary to popular belief, around 40% of U.S. homeowners own their properties free-and-clear, and among people 65 and over, that number jumps to nearly two out of three—making them an untapped goldmine for seller-financing opportunities.
Timestamps:
00:00 Discovering seller financing options
05:46 Building Relationships for Seller Financing
08:04 Asking the right questions
13:15 Financial considerations when selling property
16:25 Homeownership and real estate equity
18:20 Targeting free and clear property owners
22:38 Using direct mail to connect
25:20 Structuring a successful seller finance deal
26:26 Connect with Mel Dorman:
https://www.SellerFinanceAcademy.com
28:47 Sharing motivation to take action
Connect With Jay Conner:
Private Money Academy Conference:
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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.
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The Seller Financing Playbook: Buy Properties Without Banks or Perfect Credit with Mel Dorman
Jay Conner [00:00:01]:
What if you could buy real estate without banks, without begging for money, and without perfect credit? What if the seller of the property became the bank? And what if that one shift could completely change how fast you build your wealth? Well, today’s guest didn’t just figure that out. She’s built an entire multimillion-dollar portfolio around it. In just 5 years. Well, hey there, I’m Jay Conner, the Private Money Authority, and welcome to Raising Private Money. Now listen, most real estate investors are stuck. They’re chasing deals, fighting for funding, waiting on approvals that never come about. But what if you flipped the script? Now today I’m interviewing my good friend, fellow mastermind member, Mel Dorman. She’s a financial activist.
Jay Conner [00:00:52]:
TEDx speaker, and the founder of the Seller Financing Academy. But here’s what really matters. Mel went from barely scraping by as a social worker to building serious wealth using creative financing, especially seller-financed deals. And now, well, she’s teaching everyday people just like you how to find off-market deals, structure win-win agreements, and create wealth without relying on traditional institutions. This is not theory. This is real-world strategy you can use right now. So buckle up, put your seatbelt on, because this conversation might completely change how you think about funding your next deal.
Jay Conner [00:01:39]:
In just a moment, you’re gonna meet my good friend Mel right after this.
Narrator [00:01:45]:
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’re 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.
Jay Conner [00:02:13]:
Mel, welcome to the show.
Mel Dorman [00:02:16]:
Thanks for having me, Jay. It’s great to be here.
Jay Conner [00:02:18]:
Yes. I’m excited to have you. All right, Mel, here’s where I wanna start. Take us back for a second. What was the exact moment when you realized that traditional financing was not going to get you where you wanted to go? What happened? Oh, wow.
Mel Dorman [00:02:36]:
Yeah. I mean, I think I realized this. I, I, my first, my first property was an FHA duplex, right? Like I got in for 3.5% down. It was really awesome, you know, but I, that was pretty much all my savings on that first one. And then I started networking with other investors in the area in Portland, and I started stumbling into this idea of seller financing. And it was like the more I heard about it, the more this myth became something that was real. And I started hearing stories of people putting nothing down or $1,000 down on a $900,000 property or getting paid to buy something. And that just rocked my world so much that after I’d— I bought my duplex, my dad passed away, and I quit my job.
Mel Dorman [00:03:21]:
I was all in on seller financing because I was just so inspired by it.
Jay Conner [00:03:25]:
Wow. Powerful. So you hit that wall, you used up all your savings, uh, for that first, you know, duplex, the FHA deal, but instead of stopping, you found another way. So tell me this: you went from scraping by. As a social worker to building this multimillion-dollar portfolio in just 5 years. What did that very first seller finance deal actually look like?
Mel Dorman [00:03:55]:
Oh yeah. Okay. So I, I learned about seller financing, and every day I, I, I literally just quit my social work job. My dad passed away. I was like, if he, if he clocked in his whole life with nothing to show for it, I’m not clocking anymore. I’m done with this recipe that we were handed. And called adulting. It’s not like— we’ve got to figure out a different way here.
Mel Dorman [00:04:13]:
So I quit my job at $16,000 in my checking account, and that’s all I had to work with. And so I was every day, you know, looking for off-market properties, cold calling, door knocking, sending out mail. And about 6 months into it, I stumbled into a conversation with a bankruptcy attorney. I was cold calling, and I was looking for his client. Well, turns out his client was dead, and so it was a little awkward for me, uh, but we just, we hit it off. He was a bankruptcy attorney; I was a former social broker. I was looking for pre-foreclosure properties at the time. And, uh, so a few months into the friendship, he actually invited me, uh, over to a triplex he owned and said he wanted to— he wanted to sell it.
Mel Dorman [00:04:52]:
And when I looked up the property, I saw he had owned it for 15, 20 years. And I thought, okay, this is the property I’ve been waiting for. This is the relationship I’ve been looking for. And I kid you not, you know, for 6 months I was saying affirmations: I’m gonna buy an off-market property seller-financed. And I showed up to that property, and the first thing he said to me as we were doing the walkthrough was, I want to seller-finance this to somebody. And I just knew it was this like kismet moment, like this is gonna be my first one. And so it was, it was pretty special.
Jay Conner [00:05:20]:
So on that first seller finance deal, you didn’t even have to bring up this idea of seller financing to the seller, cuz the seller wanted to seller finance it to you. So take us to, uh, a subsequent deal, seller finance. You’re talking to the seller. How do you even bring up that concept in conversation with a potential seller?
Mel Dorman [00:05:46]:
Yeah, so, you know, I like to talk about it like dating, right? Like, you wouldn’t show up to the first date and start talking about your wedding and planning your wedding. It would be very off-putting and scary for the other person. And so usually when I’m showing up and having these conversations with sellers, I’m really just— I’m focused on their needs and their wants, and I’m asking them, know, do they have the ingredients to make them a good seller finance candidate? So I’m listening for the green flags, the red flags. You know, green flags being, do they have a lot of equity? Have they owned it for a long time? Would there be a big tax burden if they sold it? Are they tired landlords? Are they not interested in doing a 1031 exchange? They just want to get out of the property. They want to— they like the passive income, but they don’t want to be responsible anymore. All of those are green flags that this is a person who’s in— who might be interested in seller financing. And so usually the way that I broach that topic is I’m just listening, I’m building a relationship. And you’d be surprised, you know, if it’s the right fit and you pitch that, often it’s, it’s rather than saying, do you want to do seller financing? I just sort of repeat back what they’ve said to me.
Mel Dorman [00:06:48]:
Like, hey, it sounds like, you know, you, you want to be able to travel. You don’t want to have the responsibility of being a landlord anymore. You don’t really need a bunch of money at closing. You’re more concerned about the tax burden. And I sort of reflect what they’ve said and almost frame it as like, their idea, right? Like, you, you’ve told me all these things and this just makes the most sense. What do you think about getting this much down and then each month I’ll just make you this much in an installment payment? Would that feel good to you? And so I, I, that’s how I usually broach it is first by listening and then connecting the dots.
Jay Conner [00:07:19]:
That is so smart. And I love the phrase that you just said: would that feel good to you, right? Instead of just asking that direct yes or no question.
Mel Dorman [00:07:30]:
Yeah.
Jay Conner [00:07:30]:
And I love, uh, how you just explained you’re, you actually are reframing what they have already told you.
Mel Dorman [00:07:38]:
Yeah.
Jay Conner [00:07:39]:
And when you do that, you just set yourself apart because, unfortunately, most people don’t listen like you are explaining. And a lot of people don’t ask like really, really good questions, you know. Would you say that’s part of your formula is asking really, really good, curiosity-evoked questions?
Mel Dorman [00:08:04]:
Yeah, what I, what I tell my coaching students is we’re looking for questions of proposition. We’re looking for questions that unlock the imagination. You know, you’re asking it in such a way, you know, would it, like I said, would it feel comfortable to get $1,000 a month or $2,000 a month for the next 5 years? You know, does that sound appealing to you? Versus using words more that are like jargon to me, right? Would you want to seller-finance that to me? That’s my world. That’s not their world necessarily, right? And so the other thing that I really like to do too is I like to stack agreements, right? You start with a small agreement. Like it sounds like you’re tired and you want to move on from this property. Does that sound right? It sounds like you’re really concerned about the tax bill. Does that sound right? If I’m hearing you correctly, you don’t necessarily need a bunch of money for that new RV. You need about ten thousand dollars down.
Mel Dorman [00:08:47]:
Does that sound right? And you’re just like stacking agreements so that when you get to the final one, which is Would this make sense for you if we structured it this way based on what you told me, I had this idea that I think might work for you. It’ll save you a bunch in taxes. It’s going to help you get that RV you want. It’s going to help you travel and become the grandparent you’ve always wanted to be. You know, so really, it’s just about gathering agreements, and that requires listening.
Jay Conner [00:09:09]:
I love that. And so you’re actually connecting with them on a very emotional level, such as you’re wanting to do the traveling, you’re wanting— what you just said, I love. Uh, you, you want to be able to become the grandparent that you really want to be and become. And that’s such an I mean, when it comes to selling a house, uh, they’re not wanting to sell a house. They’re wanting to— they really want something else, and it’s the selling of the property that allows them to get that something else. Uh, would you agree?
Mel Dorman [00:09:44]:
Absolutely. Yeah, you’re really walking into it asking yourself one question, which is, what is the problem that I can solve for this other person? And I’ve noticed if I come with that energy of service, if I’m trying to problem solve and think through their, their needs, their wants first, that that often that, that intention comes through, right? They feel that energy of me wanting to help them. And then on the backside, I’m over here also making sure the deal works for me, right? It has to cash flow day one. It has to be; there has to be some expandability. There has to be some way that I can create appreciation and force it, right? Like there’s, there’s elements that need to be there for me too, but I’m focused on their problem and solving their problem first and foremost.
Jay Conner [00:10:21]:
You know, I say, I say to my coaching students as well all the time, as long as you’re focusing on the other person and looking at how you can serve them and leading with a servant’s heart, don’t worry about being rejected. How in the world can somebody reject that?
Mel Dorman [00:10:36]:
Yeah, exactly, exactly.
Jay Conner [00:10:39]:
When you’re totally interested in them. So, you know, what you’re talking about, Mel, for our people that are listening and tuning in, this is a brand new concept for some people. So let’s, let’s simplify it. How do you explain— and you already started doing it, but go a little bit deeper— how do you explain seller financing to someone so someone hears it and then they say, oh yeah, I get it? Because I’m sure you’ve talked to, and your students have talked to, a lot of people that never even thought about that being a possibility, right?
Jay Conner [00:11:13]:
So it’s like, you know what, like, so let’s pretend I’m a seller and you and I are having a conversation, and you’ve asked me a couple of those questions, and I say, yeah, I’m, I’m, that sounds, I like the, I like the monthly income part. But then I ask this question as a seller. So logistically, how does that work? Mm-hmm.
Mel Dorman [00:11:34]:
Logistically, you know, so most of the time people will go to a bank, and they’ll go get a mortgage. And what happens is they pay for the house, maybe that’s $500,000, but then they’ll pay another house worth of interest. Another $500,000. And what happens is all that money goes to the bank versus the seller, right? And, and so in this situation, instead of me writing my check to Wells Fargo, I’d rather write my check to you directly, seller. And then you get to make those hundreds of thousands of dollars that would have ordinarily gone to a bank. And you’re going to be secure just like a mortgage would. You know, it’s going to be above board. It’s going to have the same paperwork basically.
Mel Dorman [00:12:10]:
And a real estate attorney is going to draft that all up. You’re going to be protected. And if I ever stop paying you, you get the property back. So you’re secured. This is a secure investment. And the best part is, you don’t have to pay a ton of capital gains tax because you probably own this for 10, 20, 30 years if we’re having this conversation. And so I’m going to save you, you know, tens, maybe hundreds of thousands of dollars in taxes by spreading out that gain over time. So there are a lot of advantages for the seller to do this.
Mel Dorman [00:12:36]:
It’s not charity at all. It’s, it’s really just a strategic move on, on their part.
Jay Conner [00:12:41]:
And so what it comes down to is actually being a win-win scenario for both the seller and, uh, and, and for you as well. Um, so you just named a couple of the, of the benefits. Uh, list as many benefits as you can that, when you’re having a conversation with a seller or doing seller financing, those different benefits. One you just said was, you know, spreading those taxes, you know, over time.
Mel Dorman [00:13:07]:
Right.
Jay Conner [00:13:08]:
Uh, but what were some of the other reasons someone would be really interested in the seller financing?
Mel Dorman [00:13:15]:
Yeah, you know, when you run the numbers, a lot of times folks who have owned for 10, 20, 30 years, you know, they sell a property maybe for $700,000, they’re going to be left with about $540,000 after Uncle Sam is paid. And so to reinvest that smaller amount, they’re going to have to get a much higher return than what I could pay them. So in other words, I’ll use the example of the first triplex I bought for $500 out of pocket. The seller made a lot of money because they were earning interest on $700,000 worth of interest or principal, versus if they sold it the normal way, they’d have $540,000. They have to reinvest that not at 5.5%, but at 7.3% to beat what I was paying them at 5.5%. And so a lot of people don’t do that mental math of like, what is it really costing you to sell? You’re going to have less to work with. So that’s a big part of it. It’s also that they’re lending on something they already trust and know.
Mel Dorman [00:14:06]:
They’ve owned this property a long time. They know the ins and outs of it. They’re not putting their money in the stock market and hoping and wishing and praying that it’s going to go well. Because a lot of older folks, they don’t have time for the market to recover. They need something safe and steady. And so a rental property they already know is a safe asset because if the buyer ever defaults, they’ll get the property back. And so it’s a much safer asset than the ups and downs of the stock market. And I think the, the, the other thing is often, you know, they’re, they’re able to charge 6%, 7%, 8% for their, for their loans because they’re doing what’s an interest-only loan versus an amortized loan, which is what the bank gives us.
Mel Dorman [00:14:43]:
And so in doing that, they can get a lot more interest than they would ever get if they stuck it in a savings account or a CD or a bond or the other things that older, older folks often rely on for stability. This is a much more stable investment with a much higher return.
Jay Conner [00:14:56]:
Do you, um, more often than not pay interest-only payments and not principal?
Mel Dorman [00:15:03]:
I personally do, yeah. As an investor, um, it usually cuts the payment down by a third, so my cash flow goes up day one. The seller’s not having to pay capital gains tax, so they’re really happy. They’re, they’re waiting, you know, they’re delaying those capital gains taxes, so that’s a great win for them too. They’re earning interest on pre-tax dollars, which is great. And, um, yeah, it allows me to take better care of the tenants, right, because I’m cash flowing. So if something comes up, you know, even on the first deal, I only spent $500 out of pocket. That deal cash flowed right away.
Mel Dorman [00:15:32]:
It was a 5.5% interest-only loan, and it cash flowed. And I was able to raise Private Money on that for $10,000 because I had plenty of cash flow to raise money against. So it’s really beneficial for the seller and the buyer if the property cash flows, because it’s, it’s the seller’s asset too. You know, they don’t, they don’t want you to default. They don’t want to have to go through a foreclosure. So doing an interest-only loan really helps both of you to make sure that the property is cash flowing and it’s a stable investment.
Jay Conner [00:15:59]:
Yeah, well, that’s a commonality between seller financing and the world of Private Money that I’m in so much, and that is typically we’re paying interest only or accruing interest only with our private lenders. Are there a certain type, or is there a certain common thread or type of sellers that are more open to seller financing, say, than other types of sellers?
Mel Dorman [00:16:25]:
Yeah, yeah, absolutely. You know, a lot of times I get this question of like, well, but who owns their property free and clear? Like, nobody, you know, like that’s sort of this misconception, this myth. Um, but truthfully, 4 out of 10 homeowners own their property free and clear. And if those folks are 65 and older, which is the perfect demographic for seller financing- folks who are ready to retire, uh- 2 out of 3, so 60, 64, 65% of those folks own their property free and clear. Um, there’s something like $17 trillion, uh, boomers own $17 trillion in real estate equity. So you have this whole demographic, this whole generation that has a ton of equity. And then you have young people like me that are really struggling to get into housing. And so it’s finding somebody who’s a tired landlord.
Mel Dorman [00:17:07]:
That’s a really good person to look for. Somebody who’s looking to downsize and retire. Maybe they are empty nesters. They have a big house, and they don’t need it anymore. Maybe they’re in an expensive city,y and they want— they’re trying to move to somewhere that’s cheaper in their retirement. That’s a really good candidate. And somebody who’s trying to, to really maximize their nest egg, you know, who, who maybe is struggling to keep up with the insurance that keeps going up or the property taxes or those sorts of things. Those folks are, are read,y and they’re primed to take advantage of seller financing.
Mel Dorman [00:17:34]:
And so you wanna find those folks and help them.
Jay Conner [00:17:37]:
Well, you just set me up for the big question. And the big question is, how do you find those people? Uh, like ordinarily they’re not gonna be in the Multiple Listing Service labeled seller financing available.
Mel Dorman [00:17:51]:
Yeah, definitely not. Definitely not. Yeah. So we really use, we have a software that we use for our students called DealMaker’s Desk. And basically that pulls information from county records. It pulls information from consumer data, and it really looks at who in your area owns free and clear. And you’d be surprised, there’s a lot of people in every city, about 40% of people own free and clear. Some places are 50 or even 60% in some states.
Mel Dorman [00:18:20]:
They just have a higher demographic of free and clear properties. But basically we target the folks that are free and clear or close to it. And we also look for other, you know, signs of distress, like maybe they don’t have it occupied, maybe it’s an empty, vacant house for a long time, and they’re maybe tired of the taxes and insurance, right? Or, or maybe they don’t want a landlord; they don’t want to deal with that. And so that’s somebody who’s going to be a better candidate because they’re just losing money and they’re more primed for it. Um, maybe you’re looking for somebody who has a lien on the property, maybe a construction lien or a tax lien or something like that. that, that might motivate them to talk with you even more. So there’s, there’s things that can sort of motivate the conversation. But generally, unlike most real estate, we’re not hunting for the person who’s in distress.
Mel Dorman [00:19:01]:
We’re actually not looking for that person. We’re looking for the person who’s been super responsible, paid off their property. They’re just, they’re concerned about the tax bill. That’s who you’re looking for.
Jay Conner [00:19:11]:
So when you’re doing seller financing, and you are running the numbers as to what you could actually offer for a property, then that’s going to be very different than paying all cash, say, with Private Money or whatever. So, um, to keep it as simple as you can in the short amount of time that we do, uh, this is not your 90-day coaching program. Um, but so how, how would you summarize? How do you run the numbers on a seller finance deal to make it work for you as the buyer anyway?
Mel Dorman [00:19:50]:
Yeah, so, you know, most investors, they’re starting with the price, right? They’re, they’re picking a price; the seller tells them the price, and they’re spending all their time just beating down the price. They have one lever of negotiation. That’s what most investors have. But when you do seller financing, it opens up 4 levers. So you have interest rate, you have down payment, you have the length of the term of the loan, and price. So you have these 4 things that you can sort of move and manipulate up and down. And I like to think about the first thing that we negotiate is the monthly payment, because I could care less about the price as long as it cash flows day one, and as long as I have lots of time for appreciation to happen before I owe that payment. And so I’m happy to overpay.
Mel Dorman [00:20:28]:
I’m happy to overpay a seller if the terms are good, if I get good terms, a good interest rate, it cash flows, all that stuff. So I really think about it in those terms. Of those 4 levers, I’m designing it around what the seller values most. So if they really value price, we’re working on a low down payment, a long term, and a low interest rate. So it’s going to cash flow, and it’s going to gain lots of appreciation before I owe that final payment. And that’s, that’s really the unlock there, if you can, if you can find a seller who wants a high price and they’re okay with the terms being flexible.
Jay Conner [00:20:58]:
So, Mel, are you saying you can actually pay full retail if the terms work and are attractive enough, right?
Mel Dorman [00:21:06]:
Yes, absolutely. Yeah, I’m happy to pay retail. I’m not— I don’t actually need to beat the seller up because, I mean, you probably know this better than most, but there’s the time value of money, right? Like, I might write this is worth $700,000 in today’s dollars, but by the time I owe it in 10 or 15 years, that $700,000 is like today’s $300,000. So I have no problem writing $310,000 or $350,000, right? That doesn’t matter today because I don’t owe it. For 5, 10, 15 years. And so, um, the note, uh, I like, I like money’s not real, right? Like it’s, it’s just when you owe it that it’s going to become real. So I, I have no issue overpaying, especially if, uh, if it, you know, it means that I get the terms that I need.
Jay Conner [00:21:50]:
Right. Mel, you identified some of the categories of people that would be interested in seller financing. What are your favorite ways to reach out to them, to market to them? And of course there’s all kinds of ways. I mean, there’s outbound calling. You mentioned that when we started. There’s, uh, direct mail. Uh, there’s outbound texting. Uh, there’s, um, all kinds of methods.
Jay Conner [00:22:15]:
What in today’s market, because it changes over time.
Mel Dorman [00:22:18]:
Yeah.
Jay Conner [00:22:18]:
I mean, I’ve, I’ve been a real estate investor since 2003, and I assure you what I do today to begin a conversation with a potential seller is not at all related to what I did in 2003. Uh, what are your favorite marketing methods today to reach out to these people once you identify them and their properties?
Mel Dorman [00:22:38]:
Yeah, so I, you know, because most of the people that we’re trying to work with are older generation, they’ve owned for 20, 30 years, um, we really focus on direct mail. Um, it’s a way to start a conversation. We send what looks like a birthday card, you know, it’s, it’s a colorful envelope, it’s handwritten on the outside, it’s got a signature on the inside, it’s got a very short letter that’s just telling them I want to get to know you. I want to talk to you about your property. I’m a neighbor down the street. And so really starting the conversation off in a very relational way, um, has been the most powerful way to start, uh, to start the conversation. But then following up too with a cold call, right? Hey, did you get my letter? I’ve been trying to get a hold of you. Um, you can take it even a step further, and if it’s— if the person’s local, you can drop off a little sticky note on their door.
Mel Dorman [00:23:23]:
Hey, not sure if you got a chance. I still am trying to get a hold of you. And truly, it’s about the follow-up. So mailing on a regular frequency, whether it’s monthly or quarterly, but what wasn’t important to somebody in March might be really important to them in June. And so you want to be there when opportunity strikes, when somebody’s decided they want to move forward and sell. So just the consistency is really important. But I would say direct mail, cold calling, and then beyond that, I’ve had students have a lot of success too on Facebook Marketplace looking for tired landlords and pitching them seller financing.
Jay Conner [00:23:55]:
Okay. That makes a lot of sense. As you know, the name of this podcast is Raising Private Money. A lot of my listeners are raising Private Money. So let’s connect with them on that topic.
Mel Dorman [00:24:09]:
Yeah.
Jay Conner [00:24:09]:
From your own experience, how could Private Money and seller financing actually work together on the same deal? In other words, how could combining these 2 strategies of Private Money and seller financing, um, you know, get more deals for you?
Mel Dorman [00:24:30]:
Yeah, yeah. I think, you know, I’ll reference my first deal as a case, a good case study. But when I met with that first seller, uh, for seller financing, he wanted $75,000 down, which was roughly 10%. You know, a bank would ask for 20 or 25, so he was, he was very reasonable. But I simply just asked him, you know, what would it cost to foreclose on me? And he said $15,000. He was an attorney. He knew that we’re in Oregon. That’s what it costs.
Mel Dorman [00:24:53]:
And so I said, well, why don’t we make that the down payment? Right? $15,000. And he agreed, which was awesome. Except for again, I was a social worker. I just quit my job. I had $16,000 in my checking account. So I didn’t actually have $15,000 for this property, but that didn’t stop me because once you understand how to raise Private Money and how to structure a deal so it truly cash flows day one, you don’t need money. After all, you’re creating money. You’re creating a cash flow, right? And so you can raise money against cash flow. So what I did is I just picked up the phone.
Mel Dorman [00:25:20]:
I knew that I had built a deal that was going to cash flow roughly $1,100 a month. Picked up the phone, I called about 5 or 6 people, and it took no time at all to find a friend who would lend me $10,000 of that $15,000 in a second-position loan at 4.5%. So about $850 a month was going towards that, and I had them paid off in a year. And then I had a property that was cash-flowing $1,100 a month. So that is a good example of how you can take a seller-finance deal, structure it so it cash flows day 1, interest-only payments, really good rate and all that stuff. And then take that cash flow and go raise Private Money for the down payment. And the seller was totally okay with it. The people that were lending the money, they were excited.
Mel Dorman [00:25:58]:
They were getting my cash flow for the first year. And that’s a lot of folks that I know; that’s all they do is they don’t really ever use their own money. They just structure the deal and place the money.
Jay Conner [00:26:09]:
And there you go, another example of a win-win-win scenario. The private lender won, the seller won with seller financing, uh, you won with the cat— with the property cash flowing. Win-win-win all around. Mel, this has been incredible. How can people learn how to learn more from you?
Mel Dorman [00:26:29]:
Yeah, you know, a great way is, uh, check out our website, Seller Finance Academy. We also have a webinar that we do every week where we teach you how to find these sellers, what to say to them, and how to structure a win-win deal. We go deeper into those topics, and that’s a really great way to get to know our community and what we teach. And of course, I have a book called Bank on Your Neighbor. So if you want to, it’s free. It’s, uh, you can download it on any major podcast. But if you really want to get to know what we do as a community, you can start there too.
Jay Conner [00:26:59]:
I love it. So I want to give out, of course, all this will be in the show notes. But I want to give out that URL website one more time: www.sellerfinanceacademy.com. sellerfinanceacademy.com. And when they get to that website, Mel, what should they do?
Mel Dorman [00:27:20]:
Yeah, so you can either book a call with our team to learn more, or you can check out our webinar. You can sign up there, and that’s just a way to really start to deep dive into these topics, learn how to structure it, and see if the Academy is a good place to get the support you need to implement these things.
Jay Conner [00:27:35]:
That’s awesome. Mel, thank you so much for your very, very valuable insights. You are an expert on seller financing for sure. Uh, you have built quite the portfolio. Thank you for sharing your expertise today here on Raising Private Money.
Mel Dorman [00:27:51]:
Yeah, thank you, Jay. This is such a great conversation.
Jay Conner [00:27:54]:
You got it. Now I’m getting ready to say something that might make some people not very happy. If you’re still relying on banks to fund your deals here in 2026, you’re not an investor. You are an applicant. And applicants don’t build wealth. They ask for permission. What you just heard in this episode, this is how real players like Mel Dorman operate. Seller financing, Private Money, no begging, no approvals, no gatekeepers.
Jay Conner [00:28:27]:
Just strategy. But here’s the truth. 95% of people listening right now won’t do a thing with what they just heard. They’ll nod their head. They’ll say, this was good. Go right back to playing small. But let me ask you a question. Are you in the 5% of the people that will do something? Because the move is simple.
Jay Conner [00:28:47]:
You either close this episode, nothing changes, or you just take 10 seconds, hit share, and send this to someone who will need it, who will get unstuck, still waiting, still thinking they need permission to win. And maybe, just maybe, you’re gonna wake ’em up. And if you’re serious about actually separating yourself from the crowd, make sure you’re subscribed to this podcast, Raising Private Money, because while the other people are filling out applications, you’re building empires. I’m Jay Conner, the Private Money Authority. And I’ll see you right here on the next episode of Raising Private Money.
Narrator [00:29:28]:
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 7 reasons why Private Money will skyrocket your real estate investing business right now. 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.