Episode 208: Leveraging Private Money: Jay Conner on Strategic Real Estate Financing


***Guest Appearance

Credits to:

https://www.youtube.com/@duratusproperties 

“Ep. 25 – How to Raise Private Money for Real Estate with Expert Guest Jay Conner”

https://www.youtube.com/watch?v=gSMuEeoodHM&t=23s 

In a recent episode of the Raising Private Money podcast, Jay Conner joined Maura McGraw on her  Mastering Real Estate podcast and shared his invaluable insights on mastering real estate investment. The discussion was rich with practical strategies and personal anecdotes providing a roadmap for novice and seasoned investors. Here’s a comprehensive dive into the key takeaways from their conversation.

The Fallacy of “Get the Deal, Money Will Follow”

Both Jay Conner and Maura McGraw reflected on a pervasive piece of advice commonly given to real estate professionals: “Get the deal under contract and the money will show up.” Though well-meaning, this advice often leads to undue stress and poor decision-making.

Maura recounted her experience with her first coach who urged her to secure deals without first lining up the necessary funding. This led to precarious situations where she struggled to manage finances. Jay echoed her sentiments, emphasizing that a successful real estate strategy must start with securing money.

Building a Resilient and Strategic Mindset

Jay Conner detailed how his career was transformed by adopting a resilient mindset. After being cut off from banks during a pivotal moment, Jay didn’t despair. Instead, he pivoted towards private money. This mindset—converting setbacks into opportunities—is crucial for anyone in real estate.

He highlighted the importance of budgeting for unexpected costs, as the unpredictability of real estate projects is governed heavily by Murphy’s Law. Investors are bound to face unforeseen issues. Being mentally prepared and financially buffered for these hiccups sets successful investors apart.

From Humble Beginnings to Scaling New Heights

Jay Conner’s story is inspiring. He began his journey modestly by focusing on one house at a time. Through hard work and a systematic approach to building his team and automating his processes, he gradually scaled his operations. Technology played a crucial role in managing leads and streamlining team communication.

The Power of Private Money

A significant portion of the discussion focused on the advantages of private money. Jay Conner believes that securing funds before finding deals provides a solid foundation for growth.

For those interested in raising private money, Jay Conner suggests:

  1. Defining Your Program:
    Establish key details like interest rates, loan length, and payment frequency.
  2. Targeting Potential Lenders:
    Focus on individuals with idle retirement funds.
  3. Partnering with Self-Directed IRA Companies:
    This facilitates easier transfer of funds for lenders.

The 7-Day Private Money Challenge

One of Jay’s major highlights is his 7-day private money challenge. This accelerated learning program provides daily actionable insights on attracting private money without directly asking for it. Jay outlines a revolutionary approach where the borrower sets the terms, separating the educational aspect from presenting actual deals. This method not only empowers investors but also builds trust with potential lenders.

Balancing Work and Life

Throughout the episode, Jay emphasizes the importance of balancing work and life. To reduce stress and create more freedom for himself, Jay automated as much of his business as possible. This transition allowed him to pursue other interests, including his passion for writing music with his wife. Notably, one of their songs, “It Was Time,” has even been featured in movies at Universal Studios.

Must-Read Resources and Recommendations

Jay Conner credits much of his success to continuous learning and mentorship. Among his top recommended resources are:

  • “University of Success” by Og Mandino:
    A life-changing book that offers timeless wisdom.
  • “The Go-Giver” by Bob Berg:
    A book that reinforces the value of leading with a servant’s heart.
  • Building Relationships with a Reliable Team:
    Real estate investment is a team effort. Having trusted professionals—realtors, attorneys, home inspectors, and general contractors—can make all the difference.

Takeaways and Further Learning

Listeners who want to delve deeper can join Jay Conner’s Private Money Academy or his 7-day challenge. They can also explore his book, “Where to Get the Money Now,” which offers extensive knowledge on raising funds for real estate deals.

For real estate professionals seeking property investment opportunities and partnerships, particularly in Alabama, Maura McGraw’s Doradus Properties is actively looking for collaborators.

10 Discussion Questions from this Episode:

  1. Jay Conner and Maura McGraw both discussed the prevalent advice in the real estate industry about getting deals under contract without securing money first. How do you think this advice impacts new investors and their financial stability?
  2. Jay emphasized the importance of having a successful mindset and taking 100% responsibility in real estate investing. What are some real-life applications of this mindset that you think are crucial for new investors to understand?
  3. Maura mentioned the stressful money management situation she experienced with her first coach. How could her outcomes have been different if her coach had provided advice on securing funds first?
  4. Jay shared his struggle of being cut off from bank funding and finding success through private money. How can investors prepare for such sudden changes in their financing options?
  5. Both Jay and Maura agreed that real estate investments are unpredictable and require resiliency. What are some strategies they mentioned for managing unexpected costs, and how could they be applied in practice?
  6. Jay recommends building relationships with a reliable team in real estate. How significant do you think these relationships are in the success of real estate investments, and why?
  7. Jay Conner has diversified into various business ventures and emphasizes work-life balance. How can real estate investors scale their business while maintaining a healthy balance in their personal lives?
  8. Jay provided a step-by-step approach to attracting potential private lenders. What are the key components of this approach, and which elements do you find most effective?
  9. How does Jay Conner’s advice on prioritizing securing funds before finding deals differ from traditional real estate investment strategies, and what advantages does it offer?
  10. The episode concluded with information on Doradus Properties’ interests in buying and flipping properties. How can listeners in the Birmingham, Mobile, or Baldwin County areas benefit from connecting with Doradus Properties, and what steps should they take?

Fun facts that were revealed in the episode:

  1. Jay Conner has enjoyed writing music for Christians and the church with his wife since 1996, with their song “It Was Time” being featured in movies at Universal Studios.
  2. Jay’s favorite book is “University of Success” by Og Mandino, which he finds life-changing.
  3. Jay’s strategy for raising private money involves teaching investors about self-directed IRAs and private lending without directly asking for funds.

Timestamps

00:01 Raising Private Money Without Asking For It

05:53 Transition from mobile homes to single-family houses.

09:42 Real estate finance made accessible and manageable.

11:45 Private lenders learn about self-directed IRAs.

13:53 Pitching bank deals are different from private money.

18:36 Real estate investors must have a successful mindset.

20:19 Event plus response equals outcome, liberation through choice.

26:27 Entering business for freedom and wealth.

27:57 Transition from chaos to organization through systems.

32:49 Prioritize money first, unique real estate approach.

35:43 Establish a relationship with a self-directed IRA, copy program.

38:59 Build relationships with real estate attorney & team.

43:20 Podcast sponsored by Duratus Properties in Alabama.

 

Connect With Jay Conner: 

Private Money Academy Conference: 

https://www.JaysLiveEvent.com

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:

https://podcasts.apple.com/us/podcast/private-money-academy-real-estate-investing-with-jay/id1377723034 

Facebook:

https://www.facebook.com/jay.conner.marketing  

Twitter:

https://twitter.com/JayConner01

Pinterest:

https://www.pinterest.com/JConner_PrivateMoneyAuthority

 

Leveraging Private Money: Jay Conner on Strategic Real Estate Financing

 

 

 

Narrator [00:00:01]:

If you’re a real estate investor and are wondering how to raise and leverage private money to make more profit on every deal, then you’re in the right place. 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 [00:00:29]:

Private money has had more of an impact than anything else we’ve done in our real estate business and allowed us to scale beyond belief.

 

Maura McGraw [00:00:47]:

Welcome to the Mastering Real Estate podcast. This podcast is for real estate investors and professionals looking to take their real estate game to the next level. Each week, I review the industry’s leading real estate books and break down the main lessons that you can apply to your life and business. Then every other week, I review my lessons learned from flipping over 100 houses and being a full-time real estate investor since 2018. Stay tuned each week so that we can all become masters of real estate together. Welcome back to the Mastering Real Estate podcast. This is episode 25, and today we are talking to Jay Conner about raising private money. If you’ve ever wondered where and how to raise money for your real estate deals, you have to listen to this episode.

 

Maura McGraw [00:01:43]:

Jay gives us the ins and outs of how and why to raise private money, and this episode is a literal gold mine of great information. I’m your host, Laura McGraw. I’ve been a full-time real estate investor since 2,000 18. I’ve managed over 100 flips, founded and grew a real estate investment firm, and I am now a licensed real estate agent in Alabama. And I live and work in the real estate industry every day. Before we jump into the interview, let’s learn a little bit about Jay. Jay Conner began investing in real estate in 2003, initially relying on traditional bank financing, which required large down payments, fees, and personal guarantees. After the 2008 market crash, his banker cut him off forcing Jay to explore creative financing methods like subject to and lease options.

 

Maura McGraw [00:02:38]:

During this challenging period, Jay discovered private money lending and developed a system to attract private funds for his deals. He refined this system over several years, securing $250,000 from his first private lender and raising over $2,000,000 within months. Jay’s innovative financing strategy has transformed his business, consistently generating 7 figure profits annually, and with efficiency and automation, he’s incorporated. He now works less than 10 hours a week enjoying both financial success and personal freedom. Okay, Jay Conner. Welcome to the Mastering Real Estate podcast. I am so happy to have you here today.

 

Jay Conner [00:03:24]:

Mara, thank you so much for inviting me to come along. I’m so excited to be here to talk about my favorite subject that I’m so passionate about. And, of course, that’s private money. Why am I so excited about it? Because private money has had more of an impact than anything else we’ve done in our real estate business and it allowed us to scale beyond belief.

 

Maura McGraw [00:03:45]:

I am so excited to hear all about this. I’ve used private money a little bit, but not nearly to the extent that you have. But before we hear all about private money, I want to know a little bit about you, about your background, where you grew up, how you got into real estate, and how you found yourself focusing on private money.

 

Jay Conner [00:04:06]:

Sure. I was raised here in Eastern North Carolina in a very small market. Moorhead City, North Carolina has only 8,000 people. My total target market here in 2 counties is only 40,000 people. So we’re right here on the beach, near Atlantic Beach, over there on the island as a resort area that we live in. How did I get into this? I grew up here, and I grew up in a family of people that helps or helped other people get and own affordable housing. My father, Wallace Conner, who’s 91 and a half makes sure the half. He’s 91 and a half years old right now.

 

Jay Conner [00:04:45]:

And he’s still Wheeland and Dylan, he’s still doing development right now, and he’s building 350 houses in a development near where we live. But, anyway, at one time, his company was the largest manufactured housing or mobile home company, if you will, in the nation.

 

Maura McGraw [00:05:04]:

Oh my gosh.

 

Jay Conner [00:05:05]:

And so his company actually helped over 100 1,000 families own homes over the course of that career. So I grew up in that environment, in that business. In the early 2000s, Mara, the industry, mobile home industry, fell out of favor with Wall Street. So pretty much the consumer financing for that product went away. And so today, there are hardly any mobile home dealers or manufactured housing dealers. And in 2003, we wrapped up and closed that company. I know if I ever got out of mobile homes and manufactured housing, I knew I wanted to get into single-family houses. And that was because for years, I’d sell a single wide mobile home, and I’d try to make a $3,000 profit on that.

 

Jay Conner [00:05:53]:

But we had good friends in the early nineties who flipped a house and made $30,000 in less than 90 days. I said I like 30,000 better than 3,000. So I’d already decided if I got out of mobile homes, I was gonna get into single-family houses. So we started in 2003. From 2003 until January 2009, we used traditional funding for our deals. Conventional deal but what does that mean? That means you go to the bank, get on your hands and knees, put your hands underneath your chin, and raise your skirt so they can see your assets and your financial statement see what you got, and decide if they want to loan you money. So that’s what I did the 1st 6 years, 2003 to 2009. And, things changed abruptly for me in January of 2009.

 

Jay Conner [00:06:44]:

And since that time, we haven’t used any traditional funding. I’ll tell you that story in a moment. But fast forward, as of today, we’ve rehabbed and renovated over 500 single-family homes here in the local area. And we also work with other real estate investors on raising private money and that kind of thing. But, anyway, that’s how we got started.

 

Maura McGraw [00:07:06]:

Amazing. I’m very similar to you. My father was in it. That’s how I learned about it, but that’s an incredible story, and I’m interested to hear in a second here how the financial crisis shaped your journey. Let’s tell the audience a little bit about some of the things you have going on because you have a lot of stuff going on. You have your private money academy. You have your podcast. You’ve written a book.

 

Maura McGraw [00:07:33]:

Could you just tell us a little bit about what we’ve learned about where you came from? Let’s hear a little bit about what you have going on today.

 

Jay Conner [00:07:42]:

Sure. Friends and colleagues of of mine and my wife, Carol Joy, have just encouraged me for years years to get your book out. Get your book written. So I finally finished it. The name of it is Where to get the Money Now, where to get the money now. This is what it looks like. But anyway, the subtitle and this, by the way, this is not an ebook. This is an actual book.

 

Jay Conner [00:08:03]:

Believe it or not, the United States Postal Service is still in business. I’ll give this to your audience for free, just cover shipping. The subtitle is How and Where to Get Money for Your Real Estate Deals without relying on traditional or hard money lenders. My world of private money is not hard money. We’re not talking with brokers. But anyway, yeah, this lays out exactly step by step how I was able to raise $2,150,000 in private money without ever asking anybody for money. We’ll talk about how I do that. But, yep.

 

Jay Conner [00:08:36]:

So I’ve got my book. They can pick it up for free at www.JayConner.com/Book.  I’m glad to autograph it and send that out. And then a couple of years ago, we started our, monthly membership. We have 100 and 100 Private Money Academy members. I go live on Zoom twice a month with the membership talking about how we raise private money.

 

Jay Conner [00:09:02]:

But I’ll tell you the thing I’m most excited about, Mara. I just released this. I just released and launched the private money challenge. So that is a 7-day challenge where I come on 15 to 20 minutes a day, 7 days in a row, so it’s very digestible, consumable information, actionable items on how to attract private money without ever asking for it. And so I invite your audience to join me at www.PrivateMoneyChallenge.com,  and we dive deep into it there. That’s that’s some of the stuff that I’ve got going on.

 

Maura McGraw [00:09:42]:

That is so cool. I know my audience will love that, and I love it. A private 7-day challenge, that’s very, like, manageable. Sometimes real estate finance can feel very overwhelming to people, especially at first. So making it accessible and easy is a really important hurdle for most people to get over when they first get into real estate. So I don’t want you to have to give away all your secrets. I know that we’re gonna link everything below. People will get your book, but if you could just tell us a little bit about your process and how you raise private money, how you use it, What’s just a little bit that people can learn about and then maybe they can go further?

 

Jay Conner [00:10:29]:

So first of all, here’s what’s different in this world about getting funding for your real estate deals. The traditional way to borrow money is you go to the bank like I did for the first six years, and you apply. You provide financial statements. They pull your credit. The bottom line is they make the rules. The lender makes the rules. But here in this world of private money, guess what? We make the rules. That’s one of the biggest challenges for new people to get their minds wrapped around.

 

Jay Conner [00:11:02]:

We’re not asking for a mortgage. We’re not applying for a mortgage. We are offering a mortgage. So how is it that I’ve got 47 private lenders, 8 and a half $1,000,000 of private money that we use from project to project, and I’ve never asked for money? Here’s the secret right here, Mara. I put on my private money teacher hat, my private money teacher hat, which says private money teacher, and I simply teach. I lead through education what private money is. And when I first started raising private money back in 2009, I raised the money only through my network of connections.

 

Jay Conner [00:11:45]:

Here’s what’s interesting. All 47 of our private lenders never heard of private money. They never heard of self-directed IRAs and how they can use their retirement funds to, loan out and get returns either tax-deferred or tax-free. They didn’t know any of that stuff until what did I do? I put on my teacher hat and started teaching right what it is all about. Now desperation has got a smell to it. Okay? Desperation’s got a smell to it. And what I mean by that is if you, as a real estate investor, are talking with someone that you have a connection with, you go to church with them, you play golf with them, your kids are in soccer. Your kids are in baseball.

 

Jay Conner [00:12:30]:

Your kids are in football. Wherever you see people consistently week in and week out, that’s one first question you wanna ask yourself. Where do I see the same people all the time? Because those are people you have connections with. Here’s what’s interesting. Not one of my 47 private lenders ever heard of self-directed IRAs. They never heard of private money or private lending until I told them about it. Now, here’s what I mean by desperation has a smell to it. If you’re talking about private money and your program, I’d say just duplicate mine.

 

Jay Conner [00:13:06]:

It’s in the book. I teach it in the private money challenge. Just duplicate my pro program. What’s the interest rate you’re gonna pay? 8%. I’ve been paying 8% since 2009. I don’t care what the interest rate market’s doing. We make the rules, that’s what I pay. So we pay 8%.

 

Jay Conner [00:13:22]:

We set the length of the note and the frequency of payments. We set all that, and so we teach it. And then they tell us how much they’ve got to invest. Here’s part of the secret sauce. We separate this is critically important. We separate the conversation between teaching the program to a potential private lender, them telling us how much they have to invest, and then having a deal for them to fund. Well, it’s interesting. I never pitched a deal in my life.

 

Jay Conner [00:13:53]:

I did when I was borrowing money from the banks. I pitched deals all the time. But in this world of private money, I’ve never pitched a deal. And people say, Jay, how do you get people to fund your deals and you never pitch the deal and you never ask them to fund the deal? It’s really simple. I’m gonna give you the script right now. If I’ve got a new private lender and they’ve moved their retirement funds over to a self-directed IRA company at my recommendation, they’re not making any money until I put their money to work. So you see, when they tell me they’ve got x amount of dollars, say they say I’m talking to somebody and they got a $150,000, and let’s say it’s retirement funds and they wanna get a nice high rate of return, They’ll move that $150,000 to the self-directed IRA company that I recommend, and I’ll say, I’m gonna put your money to work pretty soon. Expect a phone call with me from me in about a couple of weeks.

 

Jay Conner [00:14:49]:

So here’s the script. I call them up with what I call the good news phone call. And so I call them up, and let’s say Mara is one of my private lenders, and let’s say Mara has said she’s got $150,000 to invest. Here’s the script on the good news phone call. I call up Mara. I say, Mara, I got great news. I can now put your money to work. I’ve got a house under contract in Newport with an after-repaired value of $200,000.

 

Jay Conner [00:15:18]:

Now the funding required for the deal is $150,000 Closing is next Friday, so you’ll need to have your funds wired to my real estate attorney’s trust account by next Thursday. I’m gonna have my real estate attorney email you the wiring instructions. End of conversation. The most stupid question I would have asked Mara is, do you want to fund the deal? Of course, she wants to fund the deal. She’s been sitting by the telephone waiting for the phone call for me to put her money to work. So that’s why it’s critically important to separate those conversations.

 

Maura McGraw [00:15:54]:

That is brilliant.

 

Jay Conner [00:15:56]:

Brilliant. You.

 

Maura McGraw [00:15:57]:

I love it.

 

Jay Conner [00:15:57]:

Let me tell you how brilliant that is. I had to screw it up well when I started to get it right.

 

Maura McGraw [00:16:04]:

As we all do.

 

Jay Conner [00:16:07]:

So, yes, by trial and error, I figured out this is the way to do this. And by the way, Mara, I’m getting ready to say something. And I know you’ve heard it more than 100 times, and it drives me stupidly crazy. And here’s what drives me crazy. Now if you don’t agree with this, ask I’m gonna ask for forgiveness right now. But here’s what drives me crazy. The gurus that go around telling new real estate investors, quote, unquote, oh, just get the deal under contract. The money will show up.

 

Maura McGraw [00:16:40]:

Oh, yes.

 

Jay Conner [00:16:42]:

I want to throw up. Like, where is the money gonna show up? They say it all that says, oh, if the deal’s good enough, the money will show up. Okay? The deal’s good enough. Where is the money? For goodness sakes. Is it gonna, like, rain out of clouds or something? I just don’t wanna stress out on not knowing where funding’s gonna come from when I’m making an offer. Absolutely. Seems like common sense to me.

 

Maura McGraw [00:17:08]:

I know. That’s so brilliant. And it’s so much it’s also easier for the investor. Absolutely.

 

Jay Conner [00:17:15]:

Yeah. I was a guest on a podcast not long ago, Mara, the host and I were having this conversation. I said I wish I knew why those people are going around the country saying just get the deal under contract. The money will show up. He says, Jay, I can tell you why they’re doing that. I said, why? Please tell me. He says, because they’re selling a course on how to get deals under contract, and they’re not teaching you how to get the money. Just get the deal under contract and the money will show up.

 

Jay Conner [00:17:40]:

Make me throw up.

 

Maura McGraw [00:17:41]:

Very true. That was true for me when I first started. That’s what my first coach told me. And he was right in the sense that once I got the deal under contract, I really had a fire lit under my butt to figure out the money situation, and I luckily did, and that was my first foray into private money. But believe me, it was stressful.

 

Jay Conner [00:18:01]:

Was it stressful?

 

Maura McGraw [00:18:02]:

Was it stressful?

 

Jay Conner [00:18:04]:

My word. Yes. And how many more offers would you have made if you had another few $100,000 waiting?

 

Maura McGraw [00:18:11]:

Several more. Probably several more. So this is absolutely genius. Okay. I am curious. At this point, you’ve probably worked with 100 of real estate investors and helped them raise private money for their deals. What are some common traits that you’ve noticed among your successful students or successful real estate investors?

 

Jay Conner [00:18:36]:

Absolutely. The first successful attribute that comes to mind is for them to be successful, before they started trying to own real estate, they owned the real estate between their ears, and they got their mindset right. Okay? So what do I mean by that? How do you get your mindset? First of all, successful real estate investors do not live in a world of blame, shame, and justification. Unfortunately, a lot of people are living in blame, shame, and justification and not taking responsibility for what happens in their lives. I love Jack Canfield’s book, The Success Principles, in which he has 69 success principles in his book. The very first principle is taking 100% responsibility for everything that happens in your life, and I love his formula. His formula for taking responsibility is e+requals0. What in the world does that stand for? The e stands for the event.

 

Jay Conner [00:19:37]:

So there’s an event that happened in your life. Alright? So the event that I just referenced was I got cut off from the banks. No notice. That’s what happened in January 2009 when I called up my banker and I had lost my line of credit. And and, hey, look. No fault of my own. That’s just what was going on in the world. And so that’s when I put my program together and raised a couple of $1,000,000 in 90 days and haven’t missed out on a deal.

 

Jay Conner [00:20:02]:

So that was the event. The global financial crisis is going on for goodness’ sake. I didn’t have anything to do with the global financial crisis. I didn’t own Lehman Brothers and didn’t have anything to do with that. Global financial crisis. That’s the event. Now I’m cut off from the banks. I have no way to fund my deals.

 

Jay Conner [00:20:19]:

Unfortunately, most people are walking around in a world of a different formula, which is e equals o. The event determines your outcome, and you can’t do anything about it because I’m a victim instead of a victor. Right? So that’s how a lot of the world operates, but a successful real estate investor realizes e plus r equals o. I am 100% responsible and I have the choice. Isn’t that liberating? I have the choice as to how I want to respond to any event that has taken place. So when I was cut off from the banks, I could have put my tail between my legs and gone home and crawled up in a ball in a corner and cried and eaten Cheerios and milk with extra sugar, or I could decide I want to respond to this event in a way that will make a different outcome in my life. So what did I do? I found out I was cut off from the banks. I sat here.

 

Jay Conner [00:21:17]:

I asked myself a question. Who do I know that can help me with my problem? And by the way, these people going around and saying every problem is an opportunity. I wanna throw up. I didn’t have an opportunity. I had a problem. I had deals under contract. No way to fund them. So I asked myself, who do I know that can help me with my problem? By the way, that question will help you fix any problem in your life, personal, financial health, relationships, business, career, etcetera.

 

Jay Conner [00:21:42]:

So immediately, I answered that question to myself. Jeff Blankenship, my good friend in real in Greensboro, North Carolina, was investing in real estate. I called him up. I told him what had happened, and he said, welcome to the club. The bank cut me off last week. I said, how are you gonna fund your deals, Jeff? He says, have you heard of private money? I said, no. He says, have you heard of self-directed IRAs? And I said no. So because of Jeff Blankenship and me asking the question, that’s where the power is in question, I called him up and asked for help.

 

Jay Conner [00:22:15]:

So I studied private money, and that changed my course. So e plus r, I was cut off from the banks. My response was to find a better and quicker way to find my deal and fund my deals, therefore, that changed my outcome. Our business, Carol Joy and Ma’s business tripled in the next 12 months from being cut off from the banks because now I have this better and quicker way to fund my deals. That’s when all those foreclosures were going on. Banks weren’t lending money. You had to have the cash to buy those foreclosures. So now I had the cash, and I could just pick and choose which deals that I wanted to do.

 

Jay Conner [00:22:52]:

So back to new real estate investors. You wanna get your mindset right. Resiliency. I’m telling you, if you don’t have a strong back and a strong will, don’t get in this business because Murphy lives every day in your world. Mhmm. And if something can go wrong, it’s gonna go wrong. And listen, we’ve rehabbed and renovated over 500 single-family houses here in our local market. I was a guest on a podcast earlier today, and the host said, Jay, I’m sure you’ve had 2 or 3 deals go sideways and didn’t go the way you planned.

 

Jay Conner [00:23:29]:

Tell us a story about one of those. I said, are you kidding? I’ve never had a deal go as planned.

 

Jay Conner [00:23:36]:

I mean, does a renovation budget ever come in on on on budget? No. It never comes in on budget. So how do you mitigate the risk? You mitigate the risk not by getting your repairs exactly right. You mitigate the risk in your offer in your offer. Like, when I make my offers, I always account for or budget an extra, depending on the project, 10 to $20,000 of the unexpected that might show up. So successful real estate investors, with a resilient mindset, we live in a world of abundance. We do not live in a world of scarcity, but you do if you choose to. Be 100% responsible for everything that happens and surround yourself with other like-minded people who are successful to help encourage you along the way.

 

Maura McGraw [00:24:35]:

So true. It’s so refreshing because so many real estate gurus out there, they always talk about how easy this is, how anybody can do it, and it’s not the case. Something is always going wrong. And probably after doing 500 flips, you know how it is. It’s you could probably count on your fingers and toes how many have gone completely smoothly. It’s not common, so you have to be able to deal with Murphy on a daily.

 

Jay Conner [00:25:04]:

Sometimes Murphy’s cousins, Murphy’s aunts, and uncles. You know. We’re renovating a house in Havelock right now at 123 Paradise Circle. Let me assure you, when we started this renovation, it was not Paradise. It just happened to be on Paradise Circle. But, anyway, we had some foundation issues that we were not anticipating to the tune of $14,000 not anticipating. In addition to that, the room on the backside of the house, we did not know was an unpermitted add-on room by some former owner.

 

Jay Conner [00:25:38]:

But, of course, that’s just part of the game. That’s part of the business. You mitigate that by making your offer discounted enough so you can anticipate those unexpected renovations that always come along.

 

Maura McGraw [00:25:54]:

So good. So you have been in business for a long time now. You’ve been through the recession, the pandemic. You’ve succeeded through all of it, and you’ve also started several different business ventures. You’re not just in real estate or private money. You’ve written a book. You have a coaching program. Can you tell us a little bit more about how you balance all those things, and what has helped you be in so many different arenas and through some trying times?

 

Jay Conner [00:26:27]:

Yeah. Thank you for that question. When Carol Joy and I started in 2003, we thought we had to do everything ourselves because, after all, nobody can do it better than you can. After we’ve been in this business for about a year, we were at Lowe’s Home Improvement at quarter to 9 on a Saturday night buying the materials, and picking out knickknacks for staging. And I looked at Carol Joy. I said, what in the world are we doing at Lowe’s Home Improvement at quarter to 9 on a Saturday night? Did we not get into this business for some freedom? Did we not get into this business for some wealth? You can be making over $1,000,000 a year and have zero freedom. Right? So the question is, how do you want to create your life? I’ll never forget one night. We’ve been in it for a couple of years.

 

Jay Conner [00:27:17]:

I came into the kitchen about 10 o’clock one evening, and my Carol Joy was sitting there at the table kitchen table and she was crying, stressed out. She looked at me. She says I can’t take it anymore. And right there, I promised myself, Mara, I would never be putting my Carol Joy in that position to where she’s stressed out. So I set out on a mission to automate this business. What’s the definition of automation? The bottom line definition of automation is to get out of your way and dictate, delegate, and disappear, and follow up to make sure things are happening. So I started putting my team together. I started building my systems.

 

Jay Conner [00:27:57]:

I ran this business entirely too long on Post-it notes everywhere. I was the most disorganized mess on the planet. Running around with my hair on fire, and that’s why it’s as thin as it is today. And, first of all, get the software in place. What kind of CRM, contact retention management? What kind of software are you gonna use to put all of your seller leads? Because we ain’t buying anything in the multiple listing service. It’s all for sale by owners off the market. Where are you gonna keep up with all those seller leads? Where are you gonna keep up with your buyer leads if you’re selling creatively on rent-to-own? So getting the systems in place, and getting my team in place made all the difference. So I set out on a quest.

 

Jay Conner [00:28:39]:

It took me an entire year to automate the business to where we got the systems in place. Fact, these systems I teach, actually, at our live event 3 times a year called the Private Money Conference. I teach these systems. And so now today, we are running the business instead of the business running us to where I work in the business, oversee the business less than 10 hours per week. And how can I do that? Because I got the team in place. I’ve got an acquisition that talks to all the sellers. I haven’t talked to a seller in years years. My acquisitions talk to the sellers.

 

Jay Conner [00:29:22]:

I’ve got a project manager who oversees the projects. Now you’re not gonna start like this by all means. I didn’t start like that. I started in 2003 doing one house at a time and finished that one until I was ready to move to the next one. So my 1st year, I only did 3 houses because I wanted to, you know, learn some lessons along the way. And so then I started scaling my business. So that’s how we evolved from having our hands in everything to stepping back to where you can run the business. The most valuable way you can spend your time is working on your business instead of working in your business.

 

Jay Conner [00:30:05]:

I had an attendee at one of our live events a while back. Well, I was talking about rehabbing and they raised their hand. They said, Jay, I just wanna let you know, I do all my rehabs. I do all my renovations. I do all my rehabs. I said, why do you do that? He says because rehabbing my houses is like therapy to me. I said, Son, anybody that rehabs their own houses needs therapy.

 

Maura McGraw [00:30:32]:

So funny. That’s so true. Oh my gosh. That is so funny. That is so great. Can you tell us I love what you’ve done? You are living the dream. Do you have any favorite tools right now that you are using in your business that don’t need to tell us all the automation, but any of your favorite tools in your toolbox that have helped you to grow scale, and automate your business?

 

Jay Conner [00:31:00]:

I mentioned it. My favorite I’ve used other contact management programs, but I have a lady who turned me on to this program that she developed, and it’s called www.ReiSoftware.com.  The engine it’s a little boutique company. She developed the software. Hardly anybody knows about it. I never mentioned it unless somebody asked, and you just did. But her name is Marla Harmon.

 

Jay Conner [00:31:26]:

She’s a Christian, wonderful lady. And so I love the software. It keeps up with with everything. And so if you’re interested in checking it out, you can go to reisoftware.com. Just tell Marla that Jay Conner sent you and, she’ll probably give you a way to sign up for you or whatever. But, anyway, that software, our acquisitionist has been with us for 18 years. Her name is Kim. Because of the software and all the communication that we do in the software, Kim and I might say hello to each other once every 3 months.

 

Jay Conner [00:31:58]:

Wow. It’s all communicating right in the software. We have the pipeline. All of our leads come in either through Google Ads or Facebook Ads outbound calling or direct mail postcards, all the different ways that we market. When a lead comes in, it automatically goes into the software without anybody manually having to put it in, and then it goes to the pipeline at different stages. And when it gets to a stage that I’m supposed to make a decision, I’m notified that, hey, Jay. You need to decide on a property. And so that streamlines our business.

 

Maura McGraw [00:32:38]:

That sounds amazing. Okay. Can you tell me something that you believe or think that no one agrees with you about?

 

Jay Conner [00:32:49]:

One of them we just said, and that was I practice and preach the money comes first. Right? Get the money lined up first and then there’s always gonna be plenty of deals. But, yes. There’s something that I do that’s very different from a lot of other educators and trainers and speakers, in the real estate investing space. And that and if you’re listening to this episode and you’ve been to any kind of seminar or conference, what I’m getting ready to say, you will relate to. You’ll go to a seminar or conference, and it seems as though you get just enough information to make yourself dangerous. And then it’s all about a pitch for coaching or whatever. And I’m not of that philosophy.

 

Jay Conner [00:33:36]:

I’m of the philosophy is I give you all I’ve got, the very best information I’ve got without holding anything back because quite frankly, that comes down to another attribute of a successful real estate investor and that is an abundant mindset. There’s plenty to go around. I’m not worried about missing out. So the abundant mindset will lend itself to your success. So what do some people not agree with me? Some of my other educator friends would say, Jay, you’re telling them too much. You’re teaching them too much. You’re giving them too much. I say, that’s your opinion.

 

Jay Conner [00:34:14]:

Let me worry about giving my people too much.

 

Maura McGraw [00:34:17]:

I love that. I love it. If someone wants to get started in raising private money for real estate deals, how or where should they get started?

 

Jay Conner [00:34:31]:

I’m gonna answer that in 2 different ways. Here’s the first way or the first thing I would say. The first thing to start doing is make a no. That is not the first thing. The first thing you wanna do is learn what program you’re gonna offer to your potential private lenders. I’d say duplicate mine. It seems to work pretty well. But you need to decide remember, you make the rules, not the lender.

 

Jay Conner [00:34:57]:

You make the rules. So decide what’s your program. What interest rate are you gonna pay? What’s the length of the notes? What’s the frequency of payments? What’s your maximum loan-to-value? And I do maximum loan to value of after repaired value. I’ll I’ll borrow up to 75% of the after-repaired value, not the purchase price. That’s very different. So first of all, what are you gonna teach? What are you gonna offer to potential private lenders? The second thing that you would do is make a list, make your list of potential private lenders out of your contacts. So I say go to your cell phone, make a list first of people that are retired. Because retired people, there’s a good chance that they’ve got what? Retirement. Funds.

 

Jay Conner [00:35:43]:

Right? And I promise you that if they’ve got retirement funds, there’s a good chance they are not happy with the returns that they’re getting on their retirement funds. Now before you contact them and share your program with them, I would also establish a relationship with a self-directed IRA company that you can refer people that you meet who have or who have retirement funds so that when they do, you can introduce them to your rep at the self-directed IRA company. They can help them move their funds over. What’s the program you’re gonna teach? Just copy mine. Make a list of retirement people because they’ve got retirement funds. Have a relationship with a self-directed IRA company, and if you want to get on the fast track, then just come on over and join me in the 7-day private money challenge, and I’ll get you off to the fast start.

 

Maura McGraw [00:36:38]:

Perfect. That sounds perfect. Okay. What are your top three favorite resources? Like, your favorite books, podcasts, what things are you loving right now?

 

Jay Conner [00:36:53]:

My top three favorite resources. The first one I’ll share is the book that changed my life when I was 24 years old. Now this is in addition to the Bible. Of course, the Bible is the win-all, have-all life-changing books, but in addition to the Bible. 24 years old, I was in a very dark place. It was not a happy time, and I was rock bottom. And so I went to the bookstore and I thought to myself, Jay, there’s gotta be a better way to live this life. At 24 years old, I was making some very stupid decisions.

 

Jay Conner [00:37:26]:

And so I went to the self-help section in the bookstore, and I came across this book, and I bought it, and I devoured it, and it changed my life immediately. The name of the book, and it’s still in print, is University of Success. University of Success. It’s by Og Mandino. Changed my life. 2nd resource, I’m gonna give you another book. And I was so, honored to have the coauthor, Bob Berg, on my podcast, Now I interviewed him. So, the name of the book is The Go-Giver.

 

Jay Conner [00:37:58]:

Mara, I’m sure you’ve heard that.

 

Maura McGraw [00:38:00]:

Fantastic. The

 

Jay Conner [00:38:01]:

Go-Giver. And they have more than one now, but I say get the original one in red. The Go-Giver, it’s not thick at all. It’s all about leading with a servant’s heart and these different topics that we’ve been talking about. The other resource I would share is a blanket statement. It’s not just one resource, it’s a philosophy, and that is to establish relationships with the best team that you can. What do I mean by that? You’re not in business unless you’ve got a great relationship with a realtor unless you are a realtor yourself. I’m not on purpose.

 

Jay Conner [00:38:38]:

I’ve been using the same realtor for 19 years. 19 years. Same realtor. We work together. His name is Chris. He pulls all of my comps and gives me my after-repaired values on properties that we wanna make an offer on. So your realtor is a very important part of your team. Secondly, establish a relationship with a real estate attorney.

 

Jay Conner [00:38:59]:

If you don’t have a good relationship with a real estate attorney, you’re not in business. And, again, the worst time to be looking for an attorney is like the worst time to be looking for a private lender, and that’s when you need one. Yep. Right? So you wanna establish these relationships first. If you’re gonna be doing any renovations you need a relationship with a home inspector to inspect your homes before you make offers. So again, the team and if you’re gonna do any renovations you need a good relationship with 1 or 2 general contractors. So put the team in place before you need the team.

 

Maura McGraw [00:39:34]:

Great advice. Those are 3 great recommendations. Okay. Last question. Outside of work, what are you doing? What types of hobbies or interests do you have? What do you love to do when you’re not doing your 10 hours of work inside the company?

 

Jay Conner [00:39:52]:

Carol Joy, my wife and I, love writing music for Christians and for the church. We’ve been writing music together ever since 1996. And, we’ve written a lot of songs, a lot of Christian names of that song is It Was Time. And I started The name of that song is It Was Time, and I started recording piano music in 1997, fluky. My piano music made it in the movies at Universal Studios.

 

Jay Conner [00:40:27]:

And, music and singing and gospel songs are a very important part of my and Carol Joy’s life. In fact, we met at church my very first Sunday in Texas when I moved out to Texas. We’re very passionate about music.

 

Maura McGraw [00:40:42]:

Oh my gosh. Well, you have to send me your favorite song, and I’ll put it in the pod a little clip from it in the podcast because that is so love. Cool and unique.

 

Jay Conner [00:40:52]:

Sure. I appreciate that. Yeah. The most popular song is called I Close My Eyes. It’s been recorded by quite a few groups, but I think I’ll share with you the recording. I’ll send you 2 recordings and you can choose which one. There’s a quartet called Narrow Way. They did a beautiful job, but I closed my eyes.

 

Jay Conner [00:41:11]:

But then there’s a chorale, choir, and by the way, everything we do is acapella, except when I’m playing the piano instrumental music. But, there’s a chorale called Concordia Sacre. They’ve just recorded it 2 years ago. Beautiful. I’ll send you links. You can listen and see what you want to publish.

 

Maura McGraw [00:41:29]:

That sounds amazing. That’ll be so cool. Okay. Tell us one last time that the audience can learn more about you and get a hold of you.

 

Jay Conner [00:41:39]:

Really, the best place to connect with me. You’ll see me right here on video, and that is the private money challenge. Come into my world at www.PrivateMoneyChallenge.com, and I’ll be seeing you right here on your telephone.

 

Maura McGraw [00:41:56]:

Awesome. Jay, thank you so much. This has been an amazing conversation. I know that I learned a ton from you in just this small conversation, and I know that my audience will get so much value out of it. So thank you so much for taking the time and coming on the Mastering Real Estate podcast.

 

Jay Conner [00:42:15]:

Maura, thank you so much for having me, and god bless you.

 

Maura McGraw [00:42:18]:

Awesome. Thank you so much to Jay for coming on the podcast. What a great interview. Jay mentioned in the interview that he composes music with his wife for fun, And I thought it was so cool that I wanted to insert a quick clip of one of his favorite songs that he’s composed here. This one is called I Close My Eyes.

 

Jay Conner [00:42:40]:

I close my eyes. I see his majesty.

 

Maura McGraw [00:43:20]:

Thank you so much for listening today. This podcast is made possible by Doradus Properties or My Real Job. Doradis is a real estate investment firm in Alabama. If you are a real estate professional located in or around the Birmingham, Mobile, or Baldwin County areas, we would love to connect and work with you. Despite the crazy interest rates these days, we are still always looking for properties to buy, and we want to expand our network of business partners. So feel free to send me an email atmora@deratusproperties.com or fill out any of the forms on our website, deratusproperties.com, so that we can connect. Right now, we are actively looking for more properties to flip and add to our rental portfolio, so keep us in mind. This concludes today’s episode.

 

Maura McGraw [00:44:06]:

Thanks so much for listening. Come back next week to learn about residential assisted living with the legendary Isabelle Guarino. Share helps immensely. Also, make sure that you’re following us on YouTube and social media. You’ll get a lot more behind the scenes and content there daily. See you in the next one.

 

Narrator [00:44:51]:

Are you feeling inspired by the knowledge you gained in this episode? Then head over to jconner.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.