Episode 210: Achieving Real Estate Freedom Using Private Money: Jay Conner’s Journey


***Guest Appearance

Credits to:

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“The Untold Secrets of Private Lending Prosperity”

https://www.youtube.com/watch?v=cw5txrXj6Vs 

In a recent episode of the Raising Private Money podcast, Jay Conner and Ida Crawford dive into the fascinating world of private money for real estate investments. The conversation unpacks the journey of Jay Conner, who successfully transitioned from traditional bank financing to the more flexible and profitable method of using private money, especially after the financial crisis of 2008.

The Transition from Traditional Bank Financing to Private Money

Initially, Jay Conner and his wife relied heavily on bank financing to fund their real estate ventures from 2003 to 2009. However, like many investors during the financial crisis, they faced a significant hurdle when banks tightened their loaning capabilities. Jay recounts the arduous moments when traditional financial institutions cut them off, compelling him to seek alternative funding options. This pivotal moment led him to discover private money, marking a transformation in his approach to real estate investing.

The Power of Private Money

Jay Conner’s introduction to private money came through a fellow investor who enlightened him about using self-directed IRAs. Within a strikingly short period of 90 days, Conner managed to raise over $2 million in private funding. This shift not only revitalized his business but also allowed him to set rules that worked in his favor.

Control and Benefits

One of the most significant advantages of private money is control. Unlike bank loans, where terms and conditions are strictly set by financial institutions, private money allows investors to negotiate favorable terms, making the deals more profitable and less stressful. Furthermore, private money is not limited by the same stringent guidelines that banks enforce, resulting in virtually unlimited funds and no constraints on the number of lenders or the amount they can contribute.

Quick Closings

Another notable benefit is the ability to close deals rapidly. Jay shared that his fastest closing, an oceanfront condominium, happened in a mere five days. This agility provides a competitive edge in the real estate market, enabling investors to capitalize on opportunities swiftly.

No Personal Investment Required

Using private money also often means that investors can secure additional funds at closing, which aids in improving cash flow without necessitating personal investment. This aspect liberates investors from the constraints of their financial standings, allowing them to pursue high-yield projects confidently.

Building Relationships and Educating Future Lenders

Jay Conner’s success with private money didn’t come from merely asking for investments; it thrived on building relationships and educating potential lenders. By focusing on a servant leadership approach, Jay was able to demystify private lending.

Educative Approach

Instead of directly soliciting funds, Jay educates individuals on the lucrative opportunities available through private lending. For instance, he uses a 16-minute audio introduction available on YouTube to outline private money’s benefits without divulging sensitive details. This approach reduces the fear of rejection and attracts genuine interest from potential lenders.

Leveraging Personal Connections

It’s noteworthy that Jay’s private lender network, which includes everyday people like retired school teachers and church acquaintances, was built entirely through word-of-mouth. In one recount, Jay shares how an 89-year-old friend, initially wary of private investments, was convinced, resulting in a significant lifestyle improvement.

Luncheons and Ethical Obligations

Jay Conner also organizes private lender luncheons as a strategy to educate multiple potential lenders simultaneously. Such an event managed to garner him $969,000 from attendees. He emphasizes the ethical obligation to ensure that funds transferred to self-directed IRA accounts by his lenders begin generating returns promptly, maintaining trust and transparency.

Private Lending through Retirement Funds

Highlighting the potent combination of private lending and retirement funds, Jay Conner reveals that over half of his 47 private lenders use their retirement savings for investments. Establishing relationships with self-directed IRA companies allows these individuals to invest their retirement funds in stable programs, offering consistent returns and no volatility since 2009.

Conclusion: An Invitation to Learn More

In wrapping up, Jay Conner extends his gratitude to the hosts and invites the audience to explore more through his private money challenge and dedicated podcast. Offering resources like a free guide on the benefits of private money and a 7-day video course, Conner encourages real estate enthusiasts to consider the profitability and stability of private lending.

Jay Conner’s transition to private money has not only sustained his business but also provided a method for others to achieve similar success. The insights shared during this podcast episode drive home the benefits of private money in real estate, emphasizing control, rapid deal execution, and the power of building genuine relationships.

10 Discussion Questions from this Episode:

  1. What were the main limitations Jay Conner faced with traditional bank financing, and how did the 2008 financial crisis influence his shift to private money?
  2. Discuss the advantages of using private money for real estate investments as outlined by Jay Conner. Which benefits do you consider the most impactful and why?
  3. How did Jay Conner’s approach to automation enhance his ability to work minimal hours while generating substantial profits in real estate investing?
  4. Jay Conner emphasizes the importance of maintaining control over business deals. In your opinion, how does private money facilitate this control compared to traditional financing?
  5. What strategies does Jay Conner use to attract private lenders, and how does his focus on education rather than direct solicitation contribute to his success?
  6. Jay Conner’s method includes the concept of the “good news phone call.” How does this approach differ from traditional funding requests, and what are its advantages?
  7. How does the ethical obligation to efficiently utilize funds from self-directed IRA accounts impact Jay Conner’s relationship with his private lenders?
  8. What misconceptions about private lending did Ida Crawford and Jay Conner address during the episode, and how do these misconceptions affect potential investors?
  9. Reflect on the story of the 89-year-old woman who became a private lender. What can this story teach us about the diverse backgrounds of private lenders and the potential for private lending to accommodate different needs?
  10. Discuss the role of self-directed IRAs in private lending as explained by Jay Conner. How do these accounts provide tax advantages for investors and what impact does this have on their investment strategy?

Fun facts that were revealed in the episode: 

  1. Jay Conner raised over $2 million in private funding within 90 days after learning about private money post-bank cutoff.
  2. Jay once raised $969,000 in a single private lender luncheon.
  3. One of Jay’s private lenders is an 89-year-old woman who initially preferred stock investments.

Timestamps

00:01 Invested in real estate; relied on banks.

05:36 Controlled lending with unlimited private money potential.

06:33 Private money allows 75% after-repair value loans.

09:48 Seeking referrals for private lending program investors.

15:24 Offer to fund Newport house investment deal.

16:15 Urgent need to invest Ida’s retirement funds.

19:31 Join the 7-day Private Money Challenge for investors.

23:03 More cash than deals for real estate.

28:41 Transferred 50% of 401(k) funds tax-free.

30:53 Join the Private Money Challenge go to

https://www.PrivateMoneyChallenge.com  or call.

 

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Have you read Jay’s new book: Where to Get The Money Now?

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What is Private Money? Real Estate Investing with Jay Conner

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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

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Achieving Real Estate Freedom Using Private Money: Jay Conner’s Journey

 

 

Narrator [00:00:01]:

If you’re a real estate investor 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.

 

Ida Crawford [00:00:31]:

Welcome, ladies and gentlemen, to Just Minding My Business Media. I’m your host, Ida Crawford. And today’s guest, Jay Conner, started investing in real estate in 2003 initially relying on traditional bank financing, which required large down payments and personal guarantees. Feeling burdened by the bank, he eventually discovered creative financing strategies like subject-to-and-lease options. After the 2008 market crash, his bank cut him off forcing him to explore private money as a new financing method. Jay developed a system to raise private funds and quickly secured millions of dollars for his deals. This system now allows him to generate 7 figure profits annually while working fewer than 10 hours per week, thanks to automation. Wow.

 

Ida Crawford [00:01:34]:

Welcome, Jay.

 

Jay Conner [00:01:36]:

Oh, my lands, Miss Ida. I’m so excited to be here with you on your show and to talk about my favorite topic that I’m most passionate about, that’s private money. And that’s because private money has had more of an impact on my real estate investing business than any other strategy that I have implemented.

 

Ida Crawford [00:01:56]:

Yes. And I could I definitely can understand that because when you’re at the mercy of banks, you’re, like, on pens and needles. Are they gonna give it to me? I hope I get it. And

 

Jay Conner [00:02:11]:

That’s right.

 

Ida Crawford [00:02:12]:

And who wants to be in that kinda situation? You know? Exactly. You wanna be able so what are your top reasons to use private money? I kinda already know, but we need to put it out there.

 

Jay Conner [00:02:25]:

Well, then the list is long. You know, the the first 6 years, my wife, Carol Joy, and I, started investing in real estate, single-family houses primarily, full time back in 2003. And from 2003 to January 2009, all I knew to do, Ida, was go to the bank. That’s all I knew to do, get on my hands and knees and put my hands underneath my chin and say, please fund my deal and, you know, raise my skirt so they can look at my assets and pull my credit score, and that’s all I needed to do. You know, they made the rules. They made the rules. And I tell you what, in January of 2009, I was sitting here at my desk and, I called up my banker, his name was Steve, and we’d done a ton of deals those 1st 6 years, you know. Mhmm.

 

Jay Conner [00:03:16]:

And I learned like that over the telephone that my line of credit had been shut down. I said, Steve, what are you talking about? Why are you closing my line of credit? He said, Jay, don’t you know there’s a global financial crisis going on right now? I said, no, but you just gave me a global financial crisis because I can’t fund these two deals, that I’ve got under contract. So I hung up the phone, Ida, and I asked myself a very important question. You know, power’s into question. I said, Jay, who do you know that can help you with your problem? And by the way, these people going around saying, oh, every problem’s an opportunity. I wanna throw up. I didn’t have an opportunity. I had a problem.

 

Jay Conner [00:03:58]:

Right? Well, I thought of my friend, Jeff Blankenship, who lived in Greensboro, North Carolina, and he was invested in real estate. I called him up. I told him what happened. He said, welcome to the club. I said, what club is that? He said the club is getting cut off at the bank. My bank cut me off last week. I said, well, how are you gonna fund your deals? He said, well, have you ever heard of private money? I said, no. And, he said, well, have you ever heard of self-directed IRAs and how people can use retirement funds to be a private lender and earn tax-free or tax-deferred, interest?

 

Jay Conner [00:04:29]:

I said, no. I never heard of that. So I studied private money very quickly, and I was able to raise $2,150,000 in less than 90 days of new funding. So in answer to your question, what do I love about private money? Well, how I went about raising that private money, and still to this day, I never ask anybody for money. Well, how in the world do I get money without a raise without asking for money? Well, here’s what we do. I put on my teacher hat, and here’s my teacher hat, and it says private money teacher. So what I started doing is I just started teaching people in my mark, my connections. Right, people I go to church with, people at the Rotary Club, what private money was.

 

Jay Conner [00:05:14]:

I got 47 of them today. None of them had ever heard of private money until I taught them. Right? So why do I love private money? Well, first of all, the banks don’t make the rules. The lenders don’t make the rules. We make the rules. Alrighty. We’re doing our underwriting. The lender is not the underwriter.

 

Jay Conner [00:05:36]:

We’re the underwriter because I’m offering an opportunity. I’m not asking anybody for money. I’m teaching them what it is, and I set the interest rate as the borrower. I set the length of the note, I set the frequency of payments, I set the maximum loan to value, and all that, and so here’s, here’s the program that I teach without having any kind of a deal attached to it in my initial conversations. You know, desperation has got a smell to it. Right? And if I’m talking about a deal and my program as to how an individual can get high rates of return safely and securely, I’m already sounding desperate. So number one reason why I love private money is I make the rules. Right? The number 2 reason I love private money is there’s no limit to the amount of private money I can use and no limit to the number of private lenders I can have.

 

Jay Conner [00:06:33]:

When I was borrowing money from the banks, they put a limit on me. Right? 3rd reason I love private money is because I never have to take any of my own this is huge. I never have to take any of my own money to the closing table because I’m gonna pick up a check every time I buy a property. And they say, Jay, how are you gonna how are you gonna pick up a check from the closing table and not take any of your money to the closing table? I mean, the banks always require a down payment. Well, here’s the secret sauce. My maximum loan-to-value is 75% of the after-repaired value of a house. I didn’t say 75% of the purchase price.

 

Jay Conner [00:07:18]:

So when you buy at a discount, a substantial discount, and there’s renovations involved, then I’m gonna be able to bring him a big check. For example, let’s say I’ve got a house with an after-repaired value of $200,000. Well, I’ll buy that house all day long for $100,000 because it needs renovation. So that’s 50% of the after-repair value. Well, if I’m gonna borrow 75% of the after-repaired value, then I can borrow $150,000 from one of my private lenders. Well, that’s $50,000 more than I need to buy the house. I’m gonna bring home a $50,000 check. So it helps my cash flow.

 

Jay Conner [00:07:57]:

Another big reason I love private money is closing quickly. I just bought a few weeks ago an oceanfront condominium right here at Atlantic Beach, North Carolina, and it was going to the foreclosure sale in less than 2 weeks, and I got and I heard from the for-sale owner, from the owner, we closed that deal in 5 days. There’s no way I could have closed that deal with a commercial bank in 5 days. My credit score has nothing to do with how much private money I can get, and the list just goes on and on. I mean, it just really puts you in control of your business.

 

Ida Crawford [00:08:35]:

And that’s what you want. You wanna be in control. That’s why we all start businesses because we wanna be in control.

 

Jay Conner [00:08:42]:

Absolutely. Absolutely. We wanna want to do what we wanna do, when we wanna do it, with whom we wanna do it, for as long as we wanna do it.

 

Ida Crawford [00:08:50]:

Absolutely. Absolutely. I love it. I love it. So you’re teaching. What do you have, like, programs or or how do you teach folks how to do this?

 

Jay Conner [00:09:04]:

Right. How to how, like, how to be a private lender. So there’s there’s more than one way. I mean, you know, I can, like let’s go back to that first 90 days. How did I get the word out? Well, several different ways. My very first private lender, I went to church on Wednesday night for bible study, and I walked into the foyer. His name was Wayne, and I said, Wayne, I got something I’d like to talk with you about confidentially, after bible study. So we got together, and here’s exactly here’s the script.

 

Jay Conner [00:09:38]:

Here’s exactly what I said to Wayne. I said, Wayne, I need your help. That’s a magic phrase right there because most people wanna help you.

 

Ida Crawford [00:09:47]:

Right? Yes. They did.

 

Jay Conner [00:09:48]:

I said, Wayne, I want to, I need your help. I said, I have now opened up my real estate investing business by referral only, and I’m paying insane high rates of return to my investors. When you run across somebody who’s complaining about the CD rates, the certificate deposit rates in the bank, and the volatility of the stock market, would you refer them to me, I’ll tell them about my private lending program and how they can earn high rates of return safely and securely? What do you think Wayne said? Wayne looked at me. He says, well, now, brother Jay, what you got in mind? Right? And I said, well, are you saying you might be interested? And, he says, well, yeah. I might be interested. I said, well, why is that? He said, well, we’re only getting 3%. Me and my wife are only getting 3% in the local bank, and we’re losing money in the stock market. He said, Jay, what kind of rates are you paying? I said, well, that sort of depends on the deal.

 

Jay Conner [00:10:48]:

What sounds high to you? He says, well, I don’t know. Maybe 5 or 6%. I said, Wayne, I can’t pay you 5 or 6%, but I can pay you 8%. He said, put me down for $250,000. Anyway, I went to his and his wife’s home the next day, and I taught them. I put on my teacher hat. Right? I went to their house, and I taught them my program with no deal attached to it in the initial conversation. So I taught them, you know, the interest rate that I, that I pay, the maximum loan to value, how they’re protected.

 

Jay Conner [00:11:22]:

I’m not gonna be borrowing any unsecured money. They’ll get a promissory note. Here in North Carolina, we use deeds of trust to collateralize the note. Most states use mortgages. Mhmm. But, anyway, we’re gonna not borrow unsecured money, and we’re gonna look after them, conservative loan to values. So I taught them the program. Right? How they can get their money back in case of an emergency I give 90-day call options.

 

Jay Conner [00:11:47]:

And so I explained the program to them, we drank a couple of cups of coffee, and that $250,000 quickly became 500,000. So one way to get the word out is 1 on 1. Right? Asking for help to spread the word. And then, you know, another way, private lender luncheons or events. I like leveraging time. It takes the same amount of time to teach the program to 20 people as it does to one person.

 

Jay Conner [00:12:15]:

So I invited 20 people, to lunch one day. I’m paying for lunch. And, I’ve got a PowerPoint presentation called the private lender, presentation, and that takes only about 20 minutes to walk through that presentation. And I went through the presentation, got an interest form on the table, and, you know, they’ve expressed that I raised $969,000 just at that one luncheon. Wow. How else do I get the word out? Well, I recorded a 16-minute audio, called Stress Reinvesting that introduces the idea of private money, but it doesn’t spill the beans. It doesn’t tell what the interest rate is or whatever. Well, I don’t wanna chase people around town.

 

Jay Conner [00:12:59]:

I don’t want anybody else to be chasing around. Again, we’re leading with a servant’s heart. We’re leading with education. Well, back in those days, we had CDs. CDs are sort of out.

 

Ida Crawford [00:13:09]:

Right? Yeah.

 

Jay Conner [00:13:12]:

So now we have that audio attached to a YouTube link, and, and, you know, and you can have that put on the business card with a QR code. So now that’s the way that we get the audio out, you know, to other people as well. Mhmm. So all of my 47 private lenders that I have and all the real estate investors that work with me, it’s all by word-of-mouth. All by word-of-mouth as far as, you know, getting the word out, teaching people, and giving out information and the audio as I talked about.

 

Ida Crawford [00:13:47]:

Yes. Wow. I love your approach.

 

Jay Conner [00:13:51]:

Well, it’s very soft. You know, new real estate investors that haven’t raised capital, they’ll ask me invariably. They’ll say, Jay, how do I get over the fear of rejection? And here’s the answer to that question with a question. And the question is, if you’re not asking anybody for anything and you’re just sharing and teaching how they can earn high rates of return safely and securely, how can you be rejected if you’re not asking anybody for anything? You can’t be you can’t be rejected now. There’s another part to this puzzle that’s very, very important. How do I get my deals funded? How can you get your deals funded when you’ve got a deal ready for your private lender to fund without asking for money? Well, here’s the script. I call it the good news phone call. The good news is a phone call.

 

Jay Conner [00:14:44]:

You see, this magic works because we’re separating teaching the program without any deal attached to it, and then having a deal for them to fund. I’ve never pitched a deal in my life. Here’s how it goes. Let’s say, Ida, you’re one of my new private lenders, and let’s say that, I’ve taught you the program, you like it, and you’ve told me that you want to start with a $150,000. So you tell me you got 150,000, and and I’ll say, okay. Ida, I’m gonna put your money to work for you just as soon as possible. So maybe a week or two goes by, and I call you up. So Ida answers the telephone.

 

Jay Conner [00:15:24]:

We have a little bit of chit-chat, and then here’s the script. I said, Ida, I have got great news for you. I can now put your money to work for you. I’ve got a house in Newport with an after-repaired value of $200,000 under contract. Now the funding required for the deal matches your money, which is $150,000, but the after-repaired value is 200,000. Now the closing, the purchase of it is gonna be next Friday, so you need to have your funds wired to my real estate attorney’s trust account by next Thursday, and I’m gonna have my attorney email you the wiring instructions. That’s the end of the conversation. I mean, the most stupid thing I could say to ask is to say, well now, Ida, do you want to fund this deal? Of course, you want to fund the deal.

 

Jay Conner [00:16:15]:

Right. You’ve been waiting for the phone call because I told you I’d call you just as soon as I’ve got a deal, you know, for you to fund. And so and here’s another important point. If Ida had moved retirement funds from her, wherever they were currently located, maybe she had them in the stock market in Vanguard or, you know, Schwab or whatever, or maybe at a previous 401 ks, if she’s moved those retirement funds over to a self-directed IRA company at my recommendation, and I did the introduction, and now that $150,000 is sitting in her self directed IRA account, Ida’s not making any money until I put her money to work because she moved it over there for me to use it, right? So now I’m ethically bound to put Ida’s money to work and borrow that money just as soon as possible. So you see how these pieces of separating conversations are so important. You know, if I’m teaching my program and I get a deal on the contract that I need to be funded, I’m already sounding desperate without even trying to sound desperate.

 

Ida Crawford [00:17:28]:

Right.

 

Jay Conner [00:17:30]:

So, anyway, hopefully, Ida, that makes sense.

 

Ida Crawford [00:17:34]:

Yeah. I’m excited. You might you got me wanting to look at my 401 k.

 

Jay Conner [00:17:39]:

There you go. There you go. Well, you know, here’s what’s interesting about that, Ida. Of, my 47 private lenders, over half of them are using retirement funds. So what do you need to do? Establish a relationship with a self-directed IRA company where you can refer people that you are talking to, then you learn they’ve got retirement funds, and they’re sick and tired of the volatility or, you know, losing money in it. And, they want something that, I mean, this program, this private money program is just like, for the private lender, it’s just like putting money in a CD, you know exactly, I mean nothing comes out, nothing, there’s no volatility in the value of that principal loan amount, it stays the same, and the lender knows exactly what the return is going to be. I’ve been paying 8% ever since 2009. 

 

Jay Conner [00:18:39]:

And, so they know exactly what the return is going to be on that investment. And when I sell the property or cash out, then the private lender gets all their principal, loan amount back, the principal amount, along with any unpaid accrued interest, you know. So it’s just a win-win for everybody. Carol Joy and I have gotten so many thank you notes and in-person thank yous from our private lenders where we have changed for those who are retired. We have been a part of changing and impacting their retirement years to where they could go travel even more than they already were and visit the grandkids, and it’s just a win-win for everybody.

 

Ida Crawford [00:19:20]:

Yes. I’m excited to meet you, Jay.

 

Jay Conner [00:19:23]:

Yes. Same here, Miss Ida, for sure.

 

Ida Crawford [00:19:26]:

So if people would’ve worked with you, how do they, connect with you?

 

Jay Conner [00:19:31]:

Sure. Well, I tell you, as far as the real estate investors go, if you’re listening to this show and you’re a real estate investor or you want to be a real estate investor or maybe you’re a seasoned real estate investor and you really wanna get some private money for your real estate deals, Well, I’m so excited. I just finished recording my 7-day private money challenge video series. So what I’ve done is I’ve recorded 7 videos, and they’re only 15 to 20 minutes long. They’re not too long at all. And when you enroll in the private money challenge, you’ll immediately receive in your email inbox, the first video training on private money, and then the next 6 days at 9 AM EST, you’ll receive each subsequent video. You’ll learn how to raise private money, and I promise you with me, you’ll have a lot of fun. So how do you enroll in the private money challenge? You go to www.privatemoneychallenge.com

 

Jay Conner [00:20:30]:

www.privatemoneychallenge.com and that’ll get you right in.

 

Ida Crawford [00:20:34]:

Alrighty. Yeah. And you’re gonna have this is gonna be, you’re gonna be busy. Let’s go to bed right now.

 

Jay Conner [00:20:44]:

Well, hey. Look. I love being busy. I love being busy for sure. And also, Miss Ida, I have a podcast. And believe it or not, I mean, here’s a shocker. Here’s a shocker. The name of my podcast, we just started our 8th year of the podcast.

 

Jay Conner [00:20:58]:

The name of the podcast is Raising Private Money with Jay Conner. It’s on all the platforms, you know, iTunes, Spotify, and whatever. Wherever you listen to your podcast Mhmm. We’re right there.

 

Ida Crawford [00:21:12]:

Yes. I’m excited about this, because I mean, in today’s economy, it’s like being retired and I heard a lady say Walmart is not a retirement plan.

 

Jay Conner [00:21:28]:

Right. There you go. Unless you just like greeting people and opening the door. Right?

 

Ida Crawford [00:21:37]:

And as seniors, we have to think about, how we’re gonna live our golden years, so to speak, comfortably and better than we did working. Mhmm. That’s the that should be the goal.

 

Jay Conner [00:21:55]:

I couldn’t agree more.

 

Ida Crawford [00:21:57]:

That should be the goal. I mean, we got up to 9 to 5 for x amount of years. Now we’re retired, and we can’t make ends meet.

 

Jay Conner [00:22:06]:

Right.

 

Ida Crawford [00:22:07]:

That’s horrible.

 

Jay Conner [00:22:08]:

Yes. Mhmm. For sure. Well, real estate changes that game for sure. Changes that outcome for sure.

 

Ida Crawford [00:22:18]:

Yes. Indeed. And, I mean, you have made this process simple, easy peasy.

 

Jay Conner [00:22:27]:

Lemon squeezy.

 

Ida Crawford [00:22:32]:

And it’s a no-brainer.

 

Jay Conner [00:22:34]:

That’s right. That’s right. Yeah. Private money is easy when you understand the process, and it’s very easy to understand the process, but, you know, raising private money sounds to most people initially so overwhelming or intimidating and, like, you gotta talk people into stuff. You don’t ever talk you don’t hey. Look. There’s more money than there are deals. There’s more money available than there are deals.

 

Jay Conner [00:23:03]:

Before COVID, there was $18,000,000,000,000 in cash sitting on the sidelines before COVID. Today, $31,000,000,000,000 in cash. Wow. Sitting on the sidelines. And so, I mean, you know, you’re gonna have, as a real estate investor, you’re gonna have a problem. And that is there’s more money than there are deals. You’re gonna have a problem using all the money that’s available to you. So, you know, if you wanna make your own rules and set your schedule and be in control of your business, then private money is the way to go.

 

Ida Crawford [00:23:39]:

Absolutely. Now let me ask you, what’s the minimum amount that like, say if somebody wanna start doing private money type deals with you, what’s the minimum amount to get started?

 

Jay Conner [00:23:54]:

Sure. My minimum amount is $50,000, not because I can buy a house with $50,000 most of the time, but because I can certainly use $50,000 for most of our renovation projects. Okay. Most of our, private lenders that I have, most of them I have started, like, around in the $100,000 range. I have some private lenders that have $1,250,000 with us. I’ve got other private lenders that’s got, you know, $50,000 with us. And then everything in between. Everything in between.

 

Jay Conner [00:24:27]:

I got a private lender coming on board, in 2 weeks from now that’s got 400,000. I just talked to a private lender, this morning on the telephone, and, she’s retired. She already had 100,000 with us, but now, somehow, miraculously, she’s got another 100,000 because, you know, private lenders always have more money than they tell you.

 

Ida Crawford [00:24:51]:

Oh, yeah. That’s everybody. That’s everybody, private lender or not. That’s the golden rule.

 

Jay Conner [00:24:58]:

That’s right. That’s right. That’s right.

 

Ida Crawford [00:25:01]:

Yes. And I’m loving this, and this is something that seniors can really move their life along and just change the whole scenario.

 

Jay Conner [00:25:13]:

That’s right. That’s right. Well and, you know, if someone’s interested in being a private lender, then it’s a a passive way.

 

Jay Conner [00:25:24]:

To get into real estate if you’re not already in it. Yes. Because, you know, me as the operator, or the borrower, we’re in charge of having all the marketing turned on, finding deals, negotiating deals, overseeing projects. And what my private lenders want is they wanna do nothing except sit back and collect checks. That’s all they want. They’re sending me send me money. My mother my mother, sharp as a tack. She’s almost 90 years old.

 

Jay Conner [00:25:59]:

She’s 89 right now. But, she became one of my private lenders now she was a hard little nut to crack there. She loves her stocks. She likes her Walmart and her Apple stocks. But, anyway, she started being a private lender with me, oh, a few years ago. And she says, I just love getting them checks in the mail and opening up their envelopes and going to the bank.

 

Ida Crawford [00:26:23]:

I bet she does. And when you think about private lenders, a lot of people probably have a wrong conception of what a private lender is.

 

Jay Conner [00:26:36]:

A lot of times, real estate investors when they hear private lenders, automatically think of hard money.

 

Ida Crawford [00:26:42]:

Yes.

 

Jay Conner [00:26:43]:

And, this is not hard money. This is not a hard this is not hard money lending. Most of the time and by the way, I say establish a relationship techniques to raise private money for their hard money lending fund. Right? Right? But, yeah, this is not doing any business with institutions, any kind of institutional money. This is doing business with individuals. And you know what? Every one of my 47 private lenders, they are an everyday walk of life people. I mean, one of my private lenders is a husband and a wife, retired school teachers from Mississippi. Right? Regular regular people.

 

Jay Conner [00:27:28]:

Another private lender inherited money from their grandfather, and it was just liquid capital. They didn’t know what to do with it. They’d heard that I had a program, so they started investing with me. I got another private lender that this is funny. Now this is funny. He retired. Are you ready for this? He retired from working for 30 years with Fannie Mae, and he never heard of private money. Because you see, he was in that institutional world.

 

Ida Crawford [00:28:02]:

Yes.

 

Jay Conner [00:28:02]:

He was in the institutional world for 30 years and didn’t have didn’t have any reason. Well, he was getting ready to retire from Fannie Mae a few years ago, and we were eating barbecue I mean, fried chicken and pork barbecue at Smithfield’s barbecue place after church on Sunday. And we’re sitting there and talking along. Well, someone that he knows is a private lender of mine. He says, Jay, tell me about your private lending program. So I did. Tell him about the interest rate, how you protect it, how you get your money back. He says, well, I’m getting ready to retire from Fannie Mae, and I’m not sure what I want to do with my retirement funds.

 

Jay Conner [00:28:41]:

Right? Because they had it in their own 401k plan, and, he says, so I’m interested in, you know, doing some business with you when I retire. And I looked at him and I said, well, why do you want to wait until you retire? He said because I can’t pull out any of my retirement funds until I retire. I said, how do you know that? He says, well, I think that’s right. I said, how about do yourself a favor and contact your plan administrator at Fannie Mae, where your 401 ks is, and ask them if you’ve got the option since you’ve been there already 28 years? Have you got an option to move some of your retirement funds, because of your tenure? Do you know what? He contacted the plan administrator of that 401 k. They allowed him to move up to 50% out of his retirement fund into another retirement fund. So that’s what he did. He pulled it out, he moved it over, and when they and when you do that, that triggers no tax effect.

 

Jay Conner [00:29:48]:

There’s no tax effect on moving that over. And when you become a private lender with your retirement funds, all the interest that you earn is either tax-deferred or tax-free, depending on the type of retirement accounts you’ve got. And there’s no limit to the amount of money that you can earn per year.

 

Ida Crawford [00:30:07]:

Wow. That’s amazing.

 

Jay Conner [00:30:10]:

That is and most people have never heard of this. Most people walking around have never heard of it.

 

Ida Crawford [00:30:15]:

Yes. And they don’t realize they could be a private lender. They can’t be part of the system. That’s the thing. They think it’s a big thing. A lot goes into it. And I’m sure some things go into it, but it’s not as hard as people think.

 

Jay Conner [00:30:32]:

No. Not at all. Not at all.

 

Ida Crawford [00:30:36]:

Wow. Jay, you are such a pleasure. You made my day.

 

Jay Conner [00:30:40]:

You made my day too. We have the same spirit. I can tell.

 

Ida Crawford [00:30:47]:

Absolutely. So, again, contact information for our viewers and listeners.

 

Jay Conner [00:30:53]:

Absolutely, come join me in the 7-day private money challenge at www.privatemoneychallenge.com.  Follow me on the podcast, Raising Private Money with Jay Conner. And if you want to contact me, just talk to me. Well, guess what? I actually pick up the phone when you call. Right? So you can go to my website, which is www.JayConner.com.  I’m an ER, not an OR. 

 

Jay Conner [00:31:26]:

And if anybody wants to talk money and talk business, then reach out to me.

 

Ida Crawford [00:31:32]:

Absolutely. So thank you so much, Jay, for meeting with me today. Like I said, you made my day. And listeners and viewers, you are gonna love Jay.

 

Jay Conner [00:31:43]:

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

 

Ida Crawford [00:31:47]:

God bless you too.

 

Narrator [00:31:49]:

Are you feeling inspired by the knowledge you gained in this episode? Then head over to www.JayConner.com/MoneyGuide.  That’s www.JayConner.com/MoneyGuide and download your free guide that shares seven reasons why private money will skyrocket your real estate investing business right now. Again, that’s www.JayConner.com/MoneyGuide to get your free guide. We’ll see you next time on raising private money with Jay Conner.