***Guest Appearance
Credits to:
https://www.youtube.com/@findingfreedomwithjohnoder3334
“Unlocking Real Estate Wealth with Private Money, with Jay Conner”
https://www.youtube.com/watch?v=IXC3j67N–8
When it comes to breaking into real estate investing, one myth has persisted for years: just get a deal under contract, and the money will show up. On a recent episode of the Raising Private Money podcast, John Odermatt sat down with Jay Conner—also known as the Private Money Authority—to bust that myth and reveal a smarter, safer path to funding real estate deals.
Why Private Money Changes the Game
Jay Conner, a veteran investor who’s bought, flipped, and rehabbed over 500 houses, attributes the success of his business not to market timing or secret deals, but to the strategic use of private money. As Jay explains, “Private money’s had more of an impact on our real estate investing business than any other strategy that we’ve employed since I started using private money to fund my deals.” The difference was clear during the 2009 financial crisis. Jay was suddenly cut off from traditional bank loans, but instead of giving up, he pivoted. After a critical conversation with another investor, he discovered the world of private money and self-directed IRAs.
Turning Problems into Opportunities
Jay’s story began with adversity: his bank stopped lending, and his deals were at risk. Rather than dwelling on the setback, he asked himself, “Who do you know that can help fix your problem?” That single question led him to a seminar on private money, and ultimately to raising over $2.15 million in alternative funding in just a few weeks. Instead of seeking help from institutions, Jay got creative and built relationships with private lenders—ordinary people interested in secure, high-return investments.
The Servant’s Heart Approach
A unique aspect of Jay’s approach to private money is his attitude. He decided never to ask anyone directly for money or pitch specific deals. Instead, he adopted a “servant’s heart” mindset, positioning himself as a teacher. As Jay puts it, “I started sharing… with my own network, my own connections, my own warm market as to what private money is and how they could be a private lender and how they could earn high rates of return safely and securely, either using their investment capital or… their retirement account.”
Jay designed a private money program offering 8% interest, with no points or origination fees. He secured these investments with deeds of trust or mortgages and included additional protections like naming lenders on insurance and title policies.
How Jay Gets Deals Funded Without Pitching
Instead of pitching deals, Jay educates his network about the opportunity first. When a suitable deal comes up, he simply provides his lender with the good news: he can now put their money to work, matching the funding required with the lender’s available funds.
Jay says, “The most stupid thing I could do is ask… do you want to fund the deal? Of course, they want to fund the deal.” His system separates the teaching of private money from the timing of specific deals, making the process seamless and stress-free for both parties.
Getting Started in Private Money—Even If You’re Brand New
Many new investors wonder, “Who’s going to loan me money if I’ve never done a deal before?” Jay emphasizes two reasons why this is possible: first, private loans are secured by the property itself. If the investor defaults, the lender gets the property, making it a safe bet.
Second, Jay recommends partnering with experienced mentors. “A brand new real estate investor should not be doing this business unless they have joined forces and… are working with somebody that already knows the ropes.”
Advice for Today’s Market
Jay’s advice for current investors? Focus on first-time homebuyer price points in your market—those properties represent the largest pool of buyers. And remember, private money isn’t just for purchasing homes: it can be used for refinancing and for other real estate investments, from land to self-storage.
If you want to learn more from Jay Conner or receive his new book “Where to Get the Money Now,” visit www.JayConner.com/Book. And for more private money strategies, tune in to Jay’s podcast Raising Private Money.
10 Discussion Questions from this Episode:
- Jay Conner criticizes the advice to “just get the deal under contract, the money will show up.” What are the potential risks of following that approach in real estate investing?
- How did Jay’s early experience in the manufactured housing business and his father’s influence shape his approach to real estate investing?
- Jay shares his “aha moment” during the 2009 financial crisis when he was cut off by his bank. How did this challenge become an opportunity, and what mindset shift did it require?
- Can you explain the concept of private money lending versus traditional or hard money lending based on Jay’s description? What are the key differences?
- Jay talks about never asking for money or pitching deals directly. Instead, he “puts on the teacher hat.” Why does this educational approach work for raising private money?
- Self-directed IRAs play a significant role in Jay’s funding strategy. How do self-directed IRAs work for private real estate investing, and what are the tax benefits he mentions?
- What are the three big reasons Jay gives for why his private lenders are eager to fund his real estate deals? How do these reasons relate to building trust and credibility?
- Jay suggests focusing on first-time homebuyer price points in today’s market. What factors make this segment particularly attractive during times of high interest rates and uncertain markets?
- For new investors, Jay emphasizes partnering with experienced mentors and building credibility. What are the specific advantages of this approach, and how does it help secure private funding?
- How does Jay’s system for using private money provide security for both the investor and the lender, and why is the deal structure (e.g., collateral, insurance, title policy) so important in private lending?
Fun facts that were revealed in the episode:
- Jay Conner has never missed out on a real estate deal due to a lack of funding since he started using private money in 2009. He credits private money with having the biggest impact on his business, saying, “I’ve never missed out on a deal for not having the funding.”
- Jay Conner and his wife Carol Joy have flipped and rehabbed over 500 houses in eastern North Carolina, averaging $86,000 profit per deal—despite operating in a market of only about 40,000 people! He believes in being a “big fish in a small pond” rather than competing in large cities.
- When raising private money, Jay takes a unique approach: he never pitches deals or asks people directly for money. Instead, he acts as a teacher, educating his network about private lending and letting them come to him when they’re ready to invest. He says, “I’ve never asked anybody for money and I’ve never pitched a deal.”
Timestamps:
00:01 Secure Funding Before Investing
06:05 From Sweat Equity to Investing
09:43 Global Crisis Halts Credit Access
11:40 Discovering Private Money Options
14:50 Teaching Private Money Opportunities
19:34 Private Money and IRAs Explained
21:17 Real Estate Investment Opportunity
26:22 Secured Loans for New Investors
30:55 Hard vs. Private Money Notes
33:21 Free Book & Event Offer
Connect With Jay Conner:
Private Money Academy Conference:
Free Report:
https://www.jayconner.com/MoneyReport
Join the Private Money Academy:
https://www.JayConner.com/trial/
Have you read Jay’s new book, Where to Get the Money Now?
It is available FREE (all you pay is the shipping and handling) at https://www.JayConner.com/Book
What is Private Money? Real Estate Investing with Jay Conner
http://www.JayConner.com/MoneyPodcast
Jay Conner is a proven real estate investment leader. Without using his own money or credit, Jay maximizes creative methods to buy and sell properties with profits averaging $67,000 per deal.
#RealEstate #RealEstateInvesting #RealEstateInvestingForBeginners #Foreclosures #FlippingHouses #PrivateMoney #RaisingPrivateMoney #JayConner
YouTube Channel
https://www.youtube.com/c/RealEstateInvestingWithJayConner
Apple Podcast:
Facebook:
https://www.facebook.com/jay.conner.marketing
Twitter:
https://twitter.com/JayConner01
Pinterest:
https://www.pinterest.com/JConner_PrivateMoneyAuthority
How Jay Conner Raises Private Money and Empowers Real Estate Investors
Jay Conner [00:00:00]:
Have you ever heard the guru stand up on stage and say, Oh, just get the deal under contract. The money will show up?
John Odermatt [00:00:10]:
Yeah, I’ve heard a few say that. Similar to that.
Jay Conner [00:00:12]:
That’s the most stupid thing in the world I’ve ever heard.
John Odermatt [00:00:15]:
It is.
Jay Conner [00:00:16]:
I mean, how’s the money going to show up? Is it going to like, rain out of clouds? Or sometimes they’ll say, Oh, get the deal under contract. Money feed finds good deals. Has money got legs? Has money going to come knocking on your door, saying, Heyy, here I am, some money. Have you got a deal? That is stupid. It just makes sense to me. Get the money lined up first and think about how much more confident and how many offers you’re going to make as a real estate investor if you know exactly where the money is coming from to begin with.
Narrator [00:00:54]:
If you’re a real estate investor and are wondering how to raise and leverage private money to make more profit on every deal, then you’re in the right place to raise private money. We’ll speak with new and seasoned investors to dissect their deals and extract the best tips and strategies to help you get the money. Because the money comes first. Now, here’s your host, Jay Conner. We are born free, and we will die free. The time in between, though, that’s complicated. In that time, governments, institutions, and our egos will limit our ability to find.
Jay Conner [00:01:37]:
True freedom in this life. These are real stories of real people.
Narrator [00:01:41]:
Overcoming the odds, persevering through injustice, and unlocking their potential. Welcome to Finding Freedom.
Jay Conner [00:01:49]:
Here’s your host, John Oderman.
John Odermatt [00:01:56]:
Hey, what’s up, everybody? Welcome back to Finding Freedom, right here on the Lions of Liberty podcast network. Have an awesome guest for you guys. Today, we’re going to be talking about real estate funding for your real estate deals. So for those entrepreneurs out there, either maybe you’re already working in real estate, or maybe you have some, you know, some dreams. Maybe you have some aspirations too. To tap into the real estate market and invest. Definitely. Hang on.
John Odermatt [00:02:26]:
You don’t want to miss this one. But before I do that, I just want to remind you guys about my friend Stephen Fox and Fox and Sons coffee. It’s my favorite coffee. I start every morning with it. My wife just asked me to make some cold brew. I go back and forth between the cold and the hot, but. But this time of year, the cold brew is definitely refreshing. He’s got several different beans that I love.
John Odermatt [00:02:53]:
I love his espresso bean. I’m having an Ethiopian bean right now that is good either hot or cold. So check those out, you can shop all of those different beans by going to Fox n Sons. That’s fox the letter n sons.com. And you can get 15% off orders $40 or more by using promo code John Johan at checkout. So please go ahead and support a good entrepreneur and a good friend of mine, Steven Fox. All right, guys, let’s get into today’s show. And my guest today is Jay Connor.
John Odermatt [00:03:32]:
And Jay is a longtime real estate investor. He’s an author. He is known as the Private Money Authority. He’s on a mission to help investors raise capital without relying on banks. And if you’ve ever, ever thought that the only way to get into real estate is with your own money or with a bank loan, think again. You’re going to learn about that today. So, Jay, welcome to Finding Freedom.
Jay Conner [00:03:59]:
John, thank you so much for inviting me to join you here on your show and talk about my favorite topic, which is private money for real estate deals. And the reason I’m so excited and so passionate about the topic of private money is that private money’s had more of an impact on our real estate investing business than any other strategy that we’ve employed since I started using private money to fund my deals. All the way back in 2009, I started using private money. You know what, John? I’ve never missed out on a deal for not having the funding.
John Odermatt [00:04:37]:
Well, that’s something I like to hear as someone getting into the real estate game, especially in these interesting times. I guess we’ll call it that, with very high interest rates, hard to get bank loans in many different circumstances. Before we dig into that, dig into some more details around private money. Just curious, so my audience can get some framework and learn a little bit more about you, if you could just share, you know what drew you into the real estate market? What brought you here?
Jay Conner [00:05:08]:
Well, into the real estate investing world at large actually goes back to my childhood and what I grew up around. So my father, Wallace Connor, who’s almost 92 years old, was at one time he was the largest retailer in the nation of mobile homes mo manufactured housing. So I grew up around my dad and his company, helping families purchase a mobile home or manufactured home. So that was affordable housing. Well, unfortunately, the industry for mobile homes and manufactured housing, the financing for the consumer, fell out of favor with Wall Street back in the early 2000s. So, no financing for that product. You really can’t sell a product. So I knew if I ever got out of mobile homes and manufactured housing, I wanted to get into single-family houses.
Jay Conner [00:06:05]:
And here’s why. All the way back to 1993, which was 10 years before my wife, Carol Joy, and I started in this industry of investing in single-family houses. Ten years before that, in 1993, good friends of ours, Craig and Kim, lived in New Bern, North Carolina, and they wanted to build their own house, but they didn’t have their money to do it. Well, Kim’s father was a real estate investor down in Florida, and he said, I’ll come up to Newber, North Carolina. I’ll find you a fixer-upper. You all can do the sweat equity, and then we’ll sell it, and you can keep the profit to start building your house. Well, in less than 90 days, they pocketed $30,000 in less than 90 days back in 1993. And I said, you know what? I know what I want to do if I ever get out of mobile homes, right? Well, the opportunity came along in 2003.
Jay Conner [00:07:02]:
So in 2003, that’s when we started investing in single-family houses right here in eastern North Carolina, if you haven’t picked up on that accent yet. And so ever since 2003, Carol Joy and I have been investing in single-family houses. We’ve bought and sold, and we’ve flipped and rehabbed over 500 houses so far. We’re in a small market, only 40,000 people, but we’ll do two to three transactions a month. Our average profits are $86,000 per deal now, and I don’t share that to brag at all. I share it to make a point. And that is, there’s an argument to be made to be a big fish in a small pond instead of competing in the large cities where you’ve got all those other real estate investors.
John Odermatt [00:07:52]:
Yeah, no, that. That makes sense. And those prices, your money goes a lot longer in, in those smaller, more rural markets, for sure, from what I’ve seen. So we talked about your introduction into real estate. What got you, you know, interested there in single-family? What was your aha moment when you realized, you know, really the power that you could unlock, generating wealth through using private money?
Jay Conner [00:08:23]:
Oh, boy, John, I remember it like it was yesterday. I was sitting right here at this desk, and it was in January of 2009. So I started investing in single-family houses in 2003, and then in January 2009, six years later, everything changed. What I’m getting ready to share right now, John, changed the total trajectory of our business. I was sitting here at this desk. I had two houses under Contract to purchase. And I thought I still had a line of credit at the bank. And so I called him a banker.
Jay Conner [00:09:04]:
His name was Steve. And I told him about these two houses that I had under contract to purchase. Now, this was back in the day, John, when I was using unsecured lines of credit. And so anyway, I told him about these two deals, and he said, Jay, we’re not loaning money out to real estate investors anymore. I said, Steve, what in the world are you talking about? We’ve had a great business relationship for six years. You funded a ton of my deals. The banks made a bunch of money off of me. We’ve had a great relationship.
Jay Conner [00:09:43]:
Why is the bank closing my line of credit? And Steve 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. I said, I don’t have a way to fund these two deals. He said, Sorry, Jay, the bank’s not loaning out money to real estate investors. So I hung up the phone, John. And I sat here at my desk for a moment, and I thought. And I thought to myself, and I want to share with you and your audience, John, a very powerful question that I asked myself right after being cut off from the bank, in my conversation with Steve, the banker. And here’s the question I asked myself. And by the way, this question will help fix any problem anybody’s got going on.
Jay Conner [00:10:33]:
I don’t care if it’s relationships, career, or financial health; it doesn’t matter. Whatever the problem is, this question will help fix the problem. And you know what, John? I can’t. I can’t stand these people running around saying, Oh, every problem’s an opportunity. I want to throw up. I didn’t have an opportunity. I had a problem. Let’s face facts right now.
Jay Conner [00:10:57]:
That problem did become an opportunity, because you and I wouldn’t be having a. A visit today without that problem. But at the time, it was a problem. So here’s the question I asked myself. I said, Jay, who? It’s not how. I said, Who do you know that can help fix your problem? And you know, it’s funny, John, when I asked myself that question, I immediately thought of my good friend Jeff Blankenship. He was living in Greensboro, North Carolina, in January of 2009, and he was investing in single-family houses. I said, Well, maybe my buddy Jeff will help me out.
Jay Conner [00:11:40]:
So I called up Jeff. I told him what had just happened with me getting cut off from the bank. Jeff said, Well, Jay, welcome to the club. I said, Well, I’m not sure I want to be a member of that club, but what club are you talking about? He said, Well, that’s the club of having the bank shut your line of credit down. He said, My bank shut me down last week. I said, Well, Jeff, how are you going to fund your real estate deals? He said, Well, have you ever heard of private money? I said, No. He said, Have you ever heard of self-directed IRAs and how individuals can take existing retirement accounts and move them over to a self-directed IRA company, and then they can loan that money out to us real estate investors, and the interest we pay them is either tax-free or tax-deferred. I said, Jeff, I don’t have a clue what you’re talking about.
Jay Conner [00:12:30]:
I said, What is private money? He said, Well, there’s this gentleman down in Jacksonville, Florida, by the name of Ron Legrand. I said, Well, who’s Ron LeGrand? He said, Well, I don’t really know, but he says he can teach us about private money. I said, Well, what is it? He says, I don’t know, but Ron Legrand says we can get a lot of it really, really fast. I said, Okay. So I went to my very first real estate investing seminar in February of 2009 to learn about private money. And John, oh boy, did I learn about private money. I came back home here to Morehead City, and I was able to raise $2,150,000 in private money, private funding that I did not have before being cut off from the bank. So how in the world did I do that? Here’s the answer.
Jay Conner [00:13:24]:
The first thing I decided, John, is I’m not going to ask anybody for money. And the second thing I decided was I’m not going to pitch any deals. You know, it’s funny, to this date, since 2009, when I started using private money, I’ve never asked anybody for money, and I’ve never pitched a deal. And people ask me all the time, they say, Jay, how in the world do you have eight and a half million dollars in private money that you just use from project to project, house to house? And how do you get it without ever pitching a deal?
John Odermatt [00:13:58]:
It’s a good question.
Jay Conner [00:14:00]:
I was gonna say, John, if you want the answer to that question, I’ll.
John Odermatt [00:14:03]:
Keep plowing forward, keep on going, keep on going, Jay.
Jay Conner [00:14:07]:
So first of all, how to get money without asking for it. So here’s what I decided. You see, the traditional way, don’t miss this. This is critical. The traditional way to borrow Money from anybody, an institution, whatever, is to have the belief that whoever’s got the money makes the rules. The traditional thinking is that whoever’s lending the money sets the interest rate. The traditional thinking is that whoever’s lending the money is the underwriter and decides on the terms as to how that money is going to be loaned out. That’s all traditional thinking.
Jay Conner [00:14:50]:
I decided I was going to turn that thinking upside down on its ear. So what did I do? I took on the attitude of having a servant’s heart, and I took on the attitude of being a teacher. So I got my teacher hat here, and my teacher hat says, Private money teacher, private money teacher. So let me unpack what that means. First, I had to decide what I was going to teach and who I was. And what and who was I going to teach it to? So I decided I was going to start sharing, first of all, with my own network, my own connections, my own warm market, as to what private money is and how they could be a private lender and how they could earn high rates of return safely and securely, either using their investment capital or their retirement account. So to do that, I had to decide, well, what in the world am I going to teach? What am I going to teach? So I decided I was going to put the private money opportunity together, the private money program, if you will.
Jay Conner [00:16:01]:
So I decided what interest rate I was going to pay my private lenders, 8%. I’ve been paying them 8% with no points, no origination fees, ever since February of 2009. So I’m going to pay them 8%. I decided what I could put in place to protect them. So I decided I was not going to borrow unsecured money. I was going to give them a deed of trust. Here in North Carolina, most people call it a mortgage and collateralize their notes. I decided I was going to name them on the insurance policy as a mortgagee to give them another layer of protection.
Jay Conner [00:16:37]:
I decided I was going to name them on the title policy as an additional insured. So I put the framework together, and then I started sharing the opportunity. Now, I need to make this very, very huge, big, important point, and that is the big mistake that real estate investors make, particularly new real estate investors looking to raise capital or seasoned real estate investors, is that they pitch deals. I’ve never pitched a deal in my life, so how do I not pitch a deal? Well, here’s the answer to that. I separate the conversations between teaching the opportunity to someone who’s never been exposed to the world of Private money. Here’s what’s interesting, John. I got 47 private lenders today. Not one of them had ever heard of private money or private lending until I put on my teacher hat and exposed them to what this world is all about.
Jay Conner [00:17:40]:
So I’m going to separate the conversations of teaching the opportunity and then having a deal for them to fund. Now, John, I’m going to take a little bit of risk right here, and I’m going to step out on a limb. I’m going to ask you a question. Here’s the question. Have you ever heard the guru stand up on stage and say, Ohh, just get the deal under contract. The money will show up?
John Odermatt [00:18:06]:
Yeah, I’ve heard a few say that. Similar to that.
Jay Conner [00:18:09]:
That’s the most stupid thing in the world I’ve ever heard.
John Odermatt [00:18:12]:
It is.
Jay Conner [00:18:12]:
I mean, how’s the money going to show up? Is it not like rain out of clouds? Or sometimes they’ll say, Oh, get the deal under contract. Money finds good deals. Has money got legs? Has money going to come knocking on your door, saying, Hey, here I am, some money. Have you got a deal? That is stupid. It just makes sense to me. Get the money lined up first. First. And think about how much more confident and how many offers you’re going to make as a real estate investor if you know exactly where the money is coming from to begin with.
Jay Conner [00:18:50]:
So separate conversations of teaching the opportunity and then having a deal for them to fund. So the best way I can illustrate this, John, on how I get deals funded without ever pitching a deal, is to share with you and your audience the exact script as to what I say to my private lender when I’ve got a deal for them to fund. And they always fund the deal 100% of the time without me pitching a deal. So here it is. Now, let me do a little setup. Let me do three hypothetical scenarios here between you and the. And this is going to make sense. So let’s pretend.
Jay Conner [00:19:34]:
First of all, John, let’s pretend you and I go to church, right? Let’s say you and I have known each other for some time. We go to church, we’re friends, and we see each other two or three times a week at church. We know each other. No question about that. The second thing we let’s assume is. Let’s assume that I have put on my teacher hat and you and I have gone and gotten coffee at Starbucks or whatever, and I’ve told you about this world of private money, and I’ve asked you if you’ve ever heard of self-directed IRAs. And you told me no. I learned in the conversation that you worked for a previous employer and that you still have $150,000 401k with that previous employer, and it’s in the stock market, a nd you don’t like it, it’s volatile, le and it’s all over the place, and you don’t like it.
Jay Conner [00:20:30]:
And let’s also assume that I have introduced you to a self-directed IRA company that I recommend. And let’s also assume you have moved that $150,000 over to the self-directed IRA company, and now you have your account funded. And I have told you I’m going to put your money to work for you just as soon as possible. So now that’s the setup. Now I’m going to call you with what I call the good news phone call. So here’s the script of the good news phone call. I call you up, you answer. We have a little chit chat, and then here’s exactly John, what I would say to you as one of my private lenders.
Jay Conner [00:21:17]:
I say, John, I’ve got great news for you. I can now put your money to work. I’ve got a house under contract in Newport, North Carolina, with an after-repaired value of $200,000. Now the funding required for this deal matches up to what you have in your self-directed IRA company. $150,000 is the funding that’s required. Now closing is scheduled for next Tuesday, so I’ll need you to have your funds wired to my real estate attorney’s trust account by next Monday. I’m going to have my real estate attorney email you the wiring instructions. That’s the end of the conversation.
Jay Conner [00:22:00]:
The most stupid thing I could do is ask John, Do you want to fund the deal? Of course, he wants to fund the deal.
John Odermatt [00:22:07]:
And John, and you also, you didn’t go into detail about the deal. You didn’t say you know what needed to be. I’m assuming this would be a flip in this that’s right scenario. You didn’t explain what needed to be done. If the kitchen needs to be done, it costs this much in the bathroom and this much. And a new roof, do they get in any of that?
Jay Conner [00:22:28]:
No. And you know why I didn’t? Because you don’t care. You don’t care.
John Odermatt [00:22:34]:
Right.
Jay Conner [00:22:34]:
And so there are three big reasons in that example why John is ecstatic to fund my deal. Let’s unpack the three reasons. Number one, John is excited to fund my deal because, first of all, he trusts me to move his money over to the self-directed. He had never heard about private lending. He never heard about self-directed IRAs. He knew he wasn’t happy where he was. He likes this program; he likes the 8% I’m going to pay him. And so he likes the program.
Jay Conner [00:23:10]:
He liked the program, and he moved his money over to the self-directed IRA at my recommendation. That’s number one. He trusted me. The second reason John is ecstatic to fund my deal is that John knows I’m not going to bring a deal for him to fund unless it matches the underwriting criteria that I already taught him. Did you hear the numbers I told John in the good news phone call? The after-repaired value is $200,000. I also told him the funding required is $150,000. Well, that is 75% of the after-repaired value. I didn’t say 75% of the purchase price.
Jay Conner [00:23:53]:
I’m going to bring home a big check called excess cash to close when I buy this property. I’m gonna buy it for 100,000. I’m bringing home a $50,000 check that I’m gonna use primarily for the renovation. So the second reason John wants to fund my deal is that it matches the criteria of the program that I already taught him. And the third big reason John wants to fund my deal is that he’s not making any money until I put his money to work. So I am ethically obligated to invest John’s money that he’s already moved over.
John Odermatt [00:24:30]:
Yeah, makes sense. So let me ask you this. You’ve gone through how you’ve done this, right? Through putting the teacher hat on, teaching people about self-directed IRAs, underwriting the deal, what they can expect, and how to make that phone call. How do you recommend people who are brand new and want to do this? How do they get started? Is this something that takes a long time to learn about to ramp up, to be able to teach it, and then build up your own network of private money investors?
Jay Conner [00:25:02]:
That’s a great question. I have many, many members of my community who have come into my world to learn all the details about this. And it’s so realistic to get $500,000 or more within 30 days. And this is for people who have been real estate investors. This is for people who are brand new and have, haven’t even done their first deal yet. And you know, that reminds me, John, one question, and it’s a very valid question. One question that new real estate investors ask is, who in the world’s going to loan me Money on a real estate deal? ?nd I’ve never done a deal before in my life.
Jay Conner [00:25:43]:
Who in the world is going to, I mean, who in their right mind is going to do that? And there are two reasons why a new real estate investor can get a lot of private money very, very quickly. And here are the two reasons. Number one, if the borrower, the real estate investor, does not pay the private lender, the property will be paid for by the private lender. In other words, if the private lender doesn’t pay them, the lender gets the property. That’s their security. Now they don’t want the property; they don’t want to mess with the property. That’s why they are a passive real estate investor. That’s why they are a lender, but that’s their security.
Jay Conner [00:26:22]:
So they’re going to loan the money out because it’s not unsecured money that’s being loaned, but it’s secured money. Now, the second reason a private lender is going to loan money to that real estate investor is because that real estate investor better not be out there doing business on their own without working with somebody who’s experienced and knows what they’re doing. S,o for example, new real estate investors that come into my community, which is about a third, about a third of my community, that come into my world for me to work with them, about a third of them have never done a real estate deal before. So guess what? I’m their business partner who has flipped over 500 houses and got over 8 and a half million in private money and got 47 private lenders. So for sure, a brand new real estate investor should not be doing this business unless they have joined forces and they’re working with somebody who already knows the ropes.
John Odermatt [00:27:24]:
Yeah, that, that definitely makes sense. Let me ask you this kind of, I guess zooming back in to the market right now, just to get your take on if somebody were looking to get started today. I know you mentioned earlier, you know, not going into big cities, but is there anything else when it comes to selecting a market to implement this private money strategy that people should be looking for in this uncertain market, where rates are high, there’s a big supply of homes? But a lot of these sellers, it doesn’t seem like they’ve got the memo that they should be dropping their prices.
Jay Conner [00:28:03]:
Right? Well, that’s a great question. So let me answer this way. First of all, private money works in your market anywhere. And by the way, private money is not just for single-family houses. Private money can be for any kind of real estate, private money can be for land, it can be for self-storage, it can be for apartments, it can be for mobile home parks, it can be for mobile homes. I mean any kind, any kind of real estate, it just comes down to how you structure the deal. But one thing that I would advise on, where or what types of deals you should be investing in, for goodness sakes, in this market, in this market, focus on first-time home buyer price points of single-family houses. Focus on first-time home buyer price points.
Jay Conner [00:28:56]:
Why is that? Because that’s where the biggest pool of buyers of houses is, first-time home buyers who have never bought before. And in addition, as I mentioned a moment ago, private money is just not for purchasing single-family houses. Private money can be used for refinancing. So if you’ve got equity in real estate and you want to pull some of that cash out for whatever reason, operating capital, or what have you, you can use private money for refinancing as well.
John Odermatt [00:29:30]:
And you talk about refinancing, I mean, with private money, you’re generally talking about a shorter term, right? So, typically, what terms are you looking at? And maybe I’m kind of going all over the place with this question, but you can kind of take it where you need to. But when you talk about, you know, bringing someone in self directed IRA, they invest $150,000. Is this something where they’re getting their return and getting their money back within three years, five years, or what is it?
Jay Conner [00:30:01]:
Right. I’m glad you asked that question, John, because that allows me to talk a second about the difference between private money and hard money. So when we’re talking private money, I’m not talking about hard money. Hard money is typically a brokerage. Hard money is typically institutional money where the hard money lender has gone out, raised capital for their hard money lending fund, and then the hard money broker turns around and lends that money out at a higher interest rate, charges points, and origination fees, and that kind of thing. In this world of private money, we’re talking about doing business for the just ordinary people, individuals, you know, just like, you know, you or me. But since I started talking about hard money and private money, I already forgot your question. What did you just ask?
John Odermatt [00:30:52]:
It was asking in general.
Jay Conner [00:30:53]:
Oh, the length of the note. Thank you.
John Odermatt [00:30:54]:
Length of the note?
Jay Conner [00:30:55]:
Yeah, length of note. So the reason I, the reason that triggered me to talk about hard money, is because most hard money lenders, the length of the note is only going to be six months or nine months for a flip, maybe 12 months if you’ve got a track record with that hard money lender. But in this world of private money, there’s no hurry to pay the money back. Here’s why. And in fact, my notes are two years or five years old. If a private lender is loaning me money from their investment capital, then I’ll set the note up for five years, even though I’m typically not going to use it that long. I sell a lot of homes on rent-to-own or lease purchase, and that gives people time to get ready for a mortgage, and then we cash out. If they’re just using investment capital, then I’ll set the length of the note up for two years, particularly if I’m just doing a flip.
Jay Conner [00:31:43]:
And I’m not going to use it for two years either. But the reason there’s no hurry to pay back private money because I’ve been paying my private lenders the same interest rate ever since February 2009. Well, guess what? The bank right down the street from my office here in Morehead City, North Carolina, is charging more than 8% for commercial rates on real estate for single-family houses. So you’re actually at 8% on private money with no points, no origination fees, no extension fees. You’re saving so much money just paying a straight 8% to the private lenders.
John Odermatt [00:32:25]:
Yeah, that makes a ton of sense, Jay. Unfortunately, we are out of time here pretty much.
Jay Conner [00:32:31]:
I know we just got started. I got so much I want to tell.
John Odermatt [00:32:34]:
I feel like we did. But before I let you go so people can follow you, nd you know, if they want to go, learn more about you, where can they do that? Give me your plugs.
Jay Conner [00:32:46]:
Sure. Well, John, first of all, I would love to give a very valuable gift, in fact, two gifts to your audience, and that is my new book,o k which is called Where to get the Money now, subtitle: How and where to get money for your real estate deals without relying on hard money lenders. This is not an ebook. This is a real book, and it’s 20 bucks at Amazon. But don’t spend 20 bucks at Amazon. I’d love to give you the book for free. I’ll autograph it. I’ll express mail it to you through the United States Postal Service.
Jay Conner [00:33:21]:
Just cover shipping and handling. You can pick up the book to get the money now at www.JayConner.com/Book, again, that’s www.JayConner.com/Book. I’ll rush it right out to you. I’m also going to include two tickets to my live event, which is called the Private Money Conference, and I do that event three times a year. Those tickets are valued at $3,000. I’m going to include two tickets along with the book. I’ll rush that right out to you. Jconnner.com book in addition to that, if you’ve enjoyed the information about private money here on this show, then come over and check out my podcast and my podcast. We’re in our eighth year of podcasting, and the name of my show is Raising Private Money.
Jay Conner [00:34:17]:
Imagine that, Raising Private Money with Jay Connor. I’m on all the podcast platforms, and twice a week, I release them early Monday morning and Thursday mornings. Twice a week, I’m interviewing other real estate investors, interviewing them as to how they have gone out and been successful in raising private money.
John Odermatt [00:34:38]:
That’s awesome. Jay, I want to thank you for coming on the show, being so generous with your time, and you know, generous with my audience with that, with that gift for today. So I appreciate that. I will link to where everyone can get that book on the Show Notes page, and I’ll link to your podcast as well. So Jay, thanks for coming on the show.
Jay Conner [00:34:58]:
John, thank you so much for having me. God bless you.
John Odermatt [00:35:03]:
Alright, guys, that is a wrap for today’s show with Jay Connor. Want to thank Jay once again for joining us today. Hopefully, everyone learned something, maybe piqued a little bit of curiosity. And if you are curious, if you are looking to learn more, please do check out the Show Notes page with those links I talked about before. You can find those, of course, at lions of liberty.c.One note before I let you all go for today, of course. You know, now here at Lions of Liberty, we have a new podcast every other Friday on our network called Politics. That’s politics spelled with tick, like the blood sucking insect, because that’s what most politicians are. So you can check that show out every other Friday with me with Brian McWilliams, Brian Nichols, and Lou Perez.
John Odermatt [00:35:56]:
It’s been getting great reviews, so please check it out. Subscribe to the feed, and that’s all I’ve got for this week. I’ll see you all next week with another awesome guest. Next week is my 500th episode, so definitely tune in for that. But in the meantime, always remember to keep your head up and those fires of liberty burning foreign.
Narrator [00:36:32]:
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.