Credits to:
https://www.youtube.com/watch?v=aSpmbmco_pA
“He Raised $2M After the Bank Cut Him Off”
https://www.youtube.com/@EdgartheConnector
If you want to scale your real estate investment business, the biggest bottleneck is often not finding the next deal, but securing the funding to make it happen. Traditional bank financing moves at a glacial pace, comes with layers of red tape, and can vanish overnight—as this episode of the Raising Private Money podcast makes abundantly clear. In this insightful conversation, Edgar Salgado sits down with Jay Conner, the Private Money Authority who built his business after having his line of credit snatched away by his bank with zero warning. What followed was a crash course in resilience, networking, and ultimately, a system for attracting millions in Private Money without a single “ask.”
From Crisis to Opportunity: The Power of Community
Jay’s story starts with a gut punch: in 2009, his bank cut off his funding without notice, leaving him with two properties under contract and no way to close. In those first critical moments, he didn’t focus on how to fix the problem alone, but rather on who could help. That question led him to a friend, Jeff, who introduced Jay to the world of Private Money and self-directed IRAs. This is a vital mindset shift for any entrepreneur: don’t ask “how,” ask “who.”
Jay emphasizes that real estate is a team sport. Cultivating relationships with mentors, advisors, and mastermind groups isn’t just a networking hack—it’s survival. As John Maxwell told Jay at an event: “I just fail more than anybody else because I try so many more things.” The key is bouncing forward, learning from every experience.
How to Attract, Not Beg, for Private Money
A myth Jay is quick to bust is the “get the deal, the money will show up” mantra preached by so many so-called gurus. The truth? Money doesn’t walk up to your door, and it doesn’t have legs. Instead, Jay’s philosophy is to get the money lined up first, offering potential lenders a consistent opportunity regardless of the deal.
So how do you start?
- Lead with Education: The first conversation with a potential lender is never about a deal. Instead, Jay focuses on teaching what private lending is, how it works, and—most importantly—how it’s safer and more lucrative than they’ve realized.
- Build Real Relationships: Every one of Jay’s 47 private lenders was either a previous acquaintance or referral. Trust is the foundation; never approach someone you don’t know with an investment pitch.
- Offer Real Protection: Private lenders get the same protections a bank would receive—insured, secured loans, conservative loan-to-values. Jay makes it simple: you’re already approved, and the terms are clear upfront.
- Separate Money and Deals: Don’t commingle the ask. First, present the opportunity. Only later, when the lender is committed, do you bring a specific deal for them to fund.
Why Private Money Wins
What’s the big differentiator? Speed. In one memorable deal, Jay shared how private funds allowed him to buy an oceanfront condo facing foreclosure within seven days—a timeframe banks could never match. That quick action not only netted a hefty profit for his business but handed the sellers nearly $100,000 more than if it had gone to foreclosure.
And, as Jay points out, thinking like a real estate investor doesn’t mean cutting corners or exploiting the vulnerable. Real service is about solving people’s problems, putting money in their pocket, and treating their situation with integrity and empathy. Every successful deal is built on trust, transparency, and putting the other person’s needs first.
Final Takeaways
Whether you’re new to real estate investing or ready to scale, Jay’s journey offers a simple but powerful lesson: “Knowledge isn’t power—implementation is.” Seek out the right people, educate them honestly, protect their investment, and deliver every time.
For those ready to take action, Jay offers resources like his “Curiosity Opener Script” and book, as well as a vibrant podcast and live events focused on Raising Private Money.
Don’t let banks decide your fate. Build your network, serve your lenders, and unlock the funding you need to grow. After all, the best investors aren’t just deal-makers—they’re community builders.
10 Discussion Questions from this Episode
- How did losing access to traditional bank funding in 2009 lead to a new approach for raising capital in real estate deals?
- What are the core differences between Private Money, hard money, and traditional bank funding as discussed in the episode?
- Why is building trust and relationships emphasized as foundational before discussing private lending opportunities?
- How does the practice of “no pitching, no begging, no selling” work in attracting private lenders, according to the strategies shared in the episode?
- What specific protections should private lenders expect to receive, and how do these compare to protections offered by banks?
- How can self-directed IRAs be utilized in private lending for real estate, and what are the advantages or challenges associated with them?
- Why is it important to have access to funding before finding deals, rather than securing money after getting a deal under contract?
- How does leading with education and a service mindset benefit both the investor and potential private lenders?
- What lessons about business and resilience did the guest learn from his father, and how have those lessons influenced his approach to real estate and coaching?
- According to the episode, what are the main risks and pitfalls new real estate investors face when structuring deals, and how can they mitigate these risks when working with private lenders?
Fun facts that were revealed in the episode:
- $2 Million Raised in 90 Days: After having his entire line of credit pulled by the bank in 2009, Jay managed to attract over $2 million in new private funding from individuals within just 90 days, without ever pitching or begging for money 01:09.
- From $250,000 to $500,000 Overnight: Jay’s very first private lender initially committed $250,000 after a conversation at church, but after learning more about the opportunity, that commitment doubled to $500,000 over a cup of coffee at their home 26:06.
- 47 Private Lenders, None Knew the System: Over the years, Jay and his wife, Carol Joy, have worked with 47 unique private lenders. Remarkably, not one of these lenders had ever even heard of Private Money or self-directed IRAs before being educated about it through a simple, educational conversation—never a sales pitch.
Timestamps:
00:00 Attracting Private Money for deals
04:35 Lessons from my dad Wallace
09:03 Mastermind group experiences
12:25 Facing the global financial crisis
14:26 Learning about Private Money
17:12 Discussing private lender protections
22:00 Educating on private lending
25:20 Discussing investment interest rates
30:25 Structuring deals with private lenders
34:08 Criteria for lending money
37:51 Balancing real estate and coaching
40:53 Private Money Conference details
44:59 Helping homeowners facing foreclosure
46:53 Dividing responsibilities in business partnership
49:24 Funding deals without bank permission
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
Servant Leadership and Private Money: The Winning Formula in Real Estate Investing
Jay Conner [00:00:00]:
Protecting and taking care of your private lenders is a number one priority. Number one priority: taking care of them and looking out for their money, just like you would your own.
Narrator [00:00:14]:
If you are a real estate investor and are wondering how to raise and leverage Private Money to make more profit on every deal, then you are 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 [00:00:41]:
I learned right over the phone, just like that, that my line of credit had been closed. We’ve done a bunch of deals. I got a great credit score. I’ve always made my payments on time. What’s the problem? He said, Jay, don’t you know there’s a global financial crisis going on right now? I said, no. I said, but you just gave me a financial crisis. I don’t have a way to fund these 2 deals. Well, I wanted to throw up, but at that moment, it was a problem that needed fixing.
Jay Conner [00:01:09]:
So when I asked— and in less than 90 days, I was able to attract over $2 million in new funding just from individuals. Have you ever heard the guru stand on stage and say, ” Oh, just get the deal under contract. The money will show up. You ever heard that? Yeah, that’s the most stupid— that’s the stupidest thing I ever heard in my life. I mean, no asking, no pitching, no begging, no selling, no persuading. I’ve never pitched a deal.
Edgar Salgado [00:01:45]:
In 2009, my guest had a bank pull his entire line of credit overnight, no warning, no fallback. Instead of quitting, he asked one question that changed everything. Who do I know that can help me out with this? That question turned into millions of dollars in Private Money and a system that he’s now taught to investors all over the country. Jay, welcome to Dream Start Own.
Jay Conner [00:02:13]:
Edgar, thank you so much for inviting me to come along and talk about my favorite subject that I’m so passionate about, that being Private Money. And the reason I’m so excited about Private Money is that this one strategy of attracting all the money you’d ever need for your real estate deals without ever asking for money, this one strategy has had more of an impact on our real estate investing business than when we started back in 2003. I started raising Private Money back in 2009. Since then, Edgar, I’ve never missed out on a real estate deal because I didn’t have the money.
Edgar Salgado [00:02:52]:
That piqued my interest, being able to raise the money without asking for it.
Jay Conner [00:02:58]:
No asking, no pitching, no begging, no selling, no persuading. I’ve never pitched a deal to a private lender, yet I always have the funding for the deal. I can’t wait to dive into that and how that works.
Edgar Salgado [00:03:13]:
Excellent. For the audience listening, give us a like and subscribe to the channel. It’s free, so you can hear more about ways to do this. Raising Private Money is one of the biggest flexes in real estate to be able to grow and scale so much faster than waiting for bank approval.
Jay Conner [00:03:30]:
Absolutely, Edgar. I mean, you know, at the end of the day, I mean, we know all about creative financing and buying subject to and seller financing and all that kind of stuff. But in the real world, the majority of sellers of properties want all the money. They want all the cash. I mean, you’ve got a percentage that will sell to you creatively, but most sellers want all the cash. In fact, I’ve reviewed thousands and thousands of property lead sheets of off-market sellers. My statistics show that 13% will sell creatively, subject to seller financing, et cetera. But 87% of those off-market sellers- what do they want? They want all the cash.
Edgar Salgado [00:04:17]:
Yeah, everybody wants it now. They want that, uh, no delay. Before we get too deep into this, let’s go back to the beginning. You grew up around your dad’s mobile home business before you ever touched a house deal. What did watching him run that business teach you?
Jay Conner [00:04:35]:
Oh my lands. Well, I don’t think we could fit all those lessons into this one episode, but I’ll give, I’ll give some highlights. Yeah, my dad, Wallace Conner, he lived to be 92 and a half years old. He just passed away a couple of months ago. And he was still in the middle of a brand-new 350-home build subdivision at 92 and a half years old. But in times past, he was— his company was the largest retailer of mobile homes and manufactured homes in the nation. I learned so much from him. One lesson that comes to mind is his quote was, always leave a little bit of meat on the bone for everybody.
Jay Conner [00:05:21]:
In other words, when you do a transaction, everybody’s got to win. Everybody’s got to be getting out of the transaction what they want. Dad was also never a respecter of persons. He always respected everybody. He always let them save face. He never put down people, you know, in front of other people. And he was always interested in serving and leading with a servant’s heart and putting the other person first. Because, you know what Zig Ziglar said, if you help enough other people get what they want, I’ll paraphrase, we don’t have to worry about ourselves.
Jay Conner [00:06:00]:
And I also learned lesson after lesson of resiliency. You know, we’re all going to fail. We’re all going to make mistakes. We’re all going to have deals that don’t go the way that we intended for them to go. And so, to be successful and a successful entrepreneur, regardless of what business you’re in, resiliency- keeping your shoulder to the wheel no matter what happens- of course, is so important. And also just as important is to have yourself surrounded by wise, smart advisors. Because, you know, counsel that comes from many is what gets you through. That comes paraphrased right from the book of Proverbs.
Jay Conner [00:06:45]:
And so surrounding yourself with other people that have, you know, been down the road before that you’re wanting to go around, that’s why my attendance and membership in multiple mastermind groups has been so important for me to surround myself with other people. I want to be the dumbest person in the room. I want to be surrounding myself with smart people that I’m trying and working on getting myself up to their level.
Edgar Salgado [00:07:16]:
You said your dad passed away a couple of months ago. My condolences.
Jay Conner [00:07:20]:
Thank you.
Edgar Salgado [00:07:22]:
What is it that you want to carry forward now that he’s not here?
Jay Conner [00:07:27]:
Well, his legacy. I mean, he left behind just an unbelievable legacy. His company right here in eastern North Carolina was the largest employer in the area for several years. And in fact, I still run into people who say, you know, working for your dad’s company was still the best job I ever had in my life. So the legacy that I’m carrying forward from my dad is that legacy of service, making a difference, making an impact. That’s why I enjoy it so much, and I’m so passionate about coaching other real estate investors and holding their hand as they are beginning to raise Private Money. Um, leading, leading, leading with that legacy of service is so important to me. It’s what gets me up in the morning.
Edgar Salgado [00:08:19]:
I love to hear it. What is it that people who didn’t meet him, you would want them to know about?
Jay Conner [00:08:28]:
Exactly what I’ve been sharing already about the legacy of service, always putting other people first. And he just never gave up. I mean, whatever projects he was working on, he just stayed with it until he saw it through. He was a true leader when it comes to those attributes.
Edgar Salgado [00:08:51]:
Another thing you mentioned was being in a room with people that are a lot smarter than you. What do you think is important for people listening to do to be in rooms like that?
Jay Conner [00:09:03]:
Well, I mean, when you’re in mastermind groups such as the groups that I’m in, um, we’re all there to serve each other. Being in a mastermind is just about— it’s just as much about giving as it is receiving. And I run my own group of, uh, real estate investors that are in my mastermind group. And, you know, everybody gets their own hot seat session, and they share what’s going on and what’s working in their world. And then they have an ask: what they need help with in their business and their life. And so instead of getting feedback from just one person, you’re getting feedback from many, many people. And regardless of how much experience someone has, we can all serve each other because we’ve all had different life experiences. We’ve all had different types of successes, different types of failures.
Jay Conner [00:10:00]:
And by the way, I mean, failure is your best teacher. Failure is your best teacher. Carol Joy, my wife, and I, we were so blessed to meet and hear John Maxwell not long ago at one of our mastermind meetings. I think he’s written like 70 or 80 books. But one of my favorite books he has written is titled Failing Forward. And when it came time for Q&A, one of the attendees, this lady, asked him, said, well, Mr. Maxwell, what is it? What attribute do you have that has, you know, played into giving you so much success? He says, well, that’s an easy question. He says, I just fail more than anybody else.
Jay Conner [00:10:46]:
He says, because I try so many more things. He says, if somebody tries 10 things and they fail at 7 and they win on 3, He says, I have at the same time probably tried 100 things. I may still fail at 70, but I got 30 wins and not 3 wins.
Edgar Salgado [00:11:08]:
Going back to 2009, uh, you and your wife Carol Joy had been investing in single-family homes for years. Then, without warning, your bank cut your line of credit. Take me back to that day.
Jay Conner [00:11:25]:
I was sitting right here at this desk when it happened. It was January of 2009. We had already been investing in single-family houses since 2003. And in those first 6 years, the only thing that I knew to do to get my deals funded was to borrow money from the banks or get a mortgage, you know, from a lender. That’s all I needed to do. I’d never heard of hard money, never heard of Private Money, which they are very, very different, by the way. So I was sitting here at my desk. I had 2 houses under contract.
Jay Conner [00:11:56]:
Those 2 deals represented an expected profit of over $100,000. And I called up my banker. His name was Steve. He had funded a lot of deals for me in those first 6 years. And when I called up Steve, I learned right over the phone, just like that, that my line of credit had been closed. And I said, Steve, what in the world are you telling me? My line of credit is closed. We’ve done a bunch of deals. I got a great credit score.
Jay Conner [00:12:25]:
Um, you’ve, you know, you’ve funded a lot of deals. I’ve always made my payments on time. What’s the problem? And Steve said, Jay, don’t you know there’s a global financial crisis going on right now? I said, no. I said, but you just gave me a financial crisis. I don’t have a way to fund these 2 deals. And so I hung up the phone, and then that’s when I asked myself that all-important question that you referenced when we started. And that was, I asked myself the question, Jay, who do you know that can help fix your problem? It’s not how, it’s who, right? And, uh, by the way, all these people running around saying, ” Oh, every problem’s an opportunity. Well, I wanna throw up.
Jay Conner [00:13:06]:
I didn’t have an opportunity. I had a problem. Now, the problem became an opportunity over time. If it hadn’t been for that problem, I wouldn’t be on your show right here. But at that moment in time, it was a problem that needed fixing. So when I asked myself, who do I know? By the way, that question will help fix any problem that you got going on in your life. Um, career, financial, uh, relationships, your health. You know, we were not created to be here on this planet by ourselves.
Jay Conner [00:13:42]:
We were created for community, and there are people in your community that can help you with whatever you’ve got going on. So when I write, when I ask myself that question, who do I know that can help me with my problem, which is called I have no funding and I’ve got deals under contract? Interestingly enough, I immediately thought of a good friend of ours. His name is Jeff. At that time, he was living in Greensboro, North Carolina, and he was investing in single-family houses. I called him up, and I told him what had just happened. And he said, well, Jay, welcome to the club. And I said, well, I’m not sure I want to be a member of that club, but what club are you talking about? Jeff says, well, my bank shut my line of credit down last week.
Jay Conner [00:14:26]:
And so I know how you feel. I said, well, Jeff, how are you going to fund your deals? He says, well, have you ever heard of Private Money? I said, nope, never heard of Private Money. He says, ” Have you heard of self-directed IRAs, where an individual can move retirement funds that they have over to a self-directed IRA and then loan that money out to us real estate investors? And the interest we pay them is either tax-deferred or tax-free. I said, Jeff, I don’t have a clue what in the world you’re talking about. What is Private Money? And Jeff said, well, I’m not really sure, but there’s this gentleman down in Jacksonville, Florida, by the name of Ron LeGrand. I said, ” Who’s Ron LeGrand? He says, well, I’m not sure about that, but he says we can get a lot of Private Money really, really fast. So that’s why Jeff and I went to Ron LeGrand’s conference to learn about Private Money.
Jay Conner [00:15:21]:
And oh boy, did I learn about Private Money. I’d never heard of it. I’d never heard of self-directed IRAs. And, editor, I came back home here to Eastern North Carolina, where we live. And I put my opportunity together, my private lending opportunity. Um, and so I just started sharing that with people in my own community, my own network, people I go to church with, et cetera. And in less than 90 days, I was able to attract over $2 million in new funding just from individuals, just from human beings that I have had a relationship with, and a part of the secret sauce is this, Edgar. There is a myth.
Jay Conner [00:16:05]:
There’s a misconception. There’s, in my opinion, a lie that a lot of real estate investors have bought hook, line, and sinker. Edgar, I’ll ask you. I think I know the answer to this question. Have you ever heard the guru stand on stage and say, ” Oh, just get the deal under contract. The money will show up. You ever heard that?
Edgar Salgado [00:16:28]:
Yeah.
Jay Conner [00:16:29]:
That’s the stupidest— that’s the stupidest thing I ever heard in my life. I mean, you get a deal under contract, or they’ll say, just get the deal under contract. Money finds good deals. You’ve probably heard that. Let me ask you a question. You get a deal under contract; is a drone going to fly over your front door and drop a bag of money on your front doorstep because you got a deal under contract? I mean, has money got legs? Running around looking for deals? No, it seems just so much more sensible to get the money lined up first without having any kind of deal attached to it. Regardless of the deal, my opportunity that I offer private lenders is the same. It’s regardless of the deal.
Jay Conner [00:17:12]:
I’ve been paying the same interest rate ever since February of 2009, 8%, no points, a straight 8%. And that’s an APR, annual percentage rate. And how I protect my private lenders is the same. I give them the same protection as a bank. So after exposing people to the opportunity, they tell you how much they’ve got to invest. Is it retirement funds? Well, you need to have a relationship with a self-directed IRA company that you could refer that person to. And then after they tell you how much they’ve got they want to invest, then what do I tell them? I say, okay, I’ll put your money to work for you just as soon as possible. And then in a week or 2 weeks, I call them up with what I call the good news phone call.
Jay Conner [00:17:57]:
They’re already expecting the call. I don’t have to pitch the deal. I only tell them 4 things about the deal, and they— and that’s really more than they want to know. Like, Edgar, let’s say you’re one of my new private lenders, and I call you up with the good news phone call. I call you up, you answer the phone, and I say, Edgar, I got great news. I can now put your money to work. I’ve got a property, a house in Newport under contract with an after-repair value of $200,000. The $150,000 is required for the funding.
Jay Conner [00:18:29]:
Well, that matches up to what you’ve got in the retirement account that you’ve already moved over to the self-directed IRA company that I introduced you to. Funding— I mean, closing is going to be next Thursday, so you’ll need to have your funds wired to my real estate attorney’s trust account. By next Wednesday, I’m going to have my real estate attorney email you the wiring instructions. That’s the end of the conversation. The stupidest thing I could ask is, Edgar, do you want to fund the deal? Well, of course Edgar wants to fund the deal for 3 big reasons. Number one, he trusted me to move his $150,000 in this example over to the self-directed IRA company. And he already told me he loves the opportunity, the interest rate. And how he’s protected.
Jay Conner [00:19:15]:
So he’s already moved the money over. Secondly, in this example, Edgar knows I’m not going to bring a deal for him to fund that doesn’t match the criteria of the program that I already taught him. He knows I’m not going to borrow more than 75% of the after-repair value. Well, $150,000 is 75% of $200,000. And then thirdly, the reason Edgar in this example wants to fund my deal is that Edgar is not making any money. Until I put his money to work, and he’s trusted me to already move that money over. So all I’m doing is fulfilling my promise, telling him we’ve got the deal under contract, and I can now put his money to work for him. And everybody’s happy.
Jay Conner [00:19:58]:
It’s that simple.
Edgar Salgado [00:19:59]:
When you’re ready to finance your next property, if it’s gonna be through hard money lending, if you need a construction loan, a BRRRR method, a conventional loan, hey, check out my link below for Deal Funding 360. Julian and his team have been doing it for over 20 years, and they’re super knowledgeable. They’re going to give you all the tips and tricks, and don’t just use them by themselves. Make sure that you use multiple options. I like to put them against each other and see which one gives me the best rate. They’ll start dropping off themselves, saying they can’t match that rate. Hopefully get the best deal that way. Make sure you use the link below and tell them I sent you.
Edgar Salgado [00:20:32]:
For the audience that doesn’t know, a self-directed IRA: If you have a 401 from a company you no longer work with, you can get that transferred to a self-directed IRA. This is not financial advice. Give it to a CPA. Jay, in 2009— so you started in 2003— what kind of, uh, real estate investing was it that you were doing?
Jay Conner [00:20:53]:
All single-family houses. Yeah, and that’s a new— I’m sorry?
Edgar Salgado [00:20:58]:
Fix and flip?
Jay Conner [00:21:00]:
Um, all the above. So a lot of fix and flips. Uh, I’ve sold a lot of homes over the years on rent-to-own or lease-purchase and helped the families get ready for a mortgage so they could then actually get the title or transfer it over. Uh, I’ve sold some homes for equity in lease purchase where I give a discount, and then the buyer of that home is responsible for the cosmetics. Um, now, interestingly enough, in all these years, I’ve never wholesaled a deal in my life. I know how to wholesale a deal. Right? Collect an assignment fee. But I just like staying in all my deals, right? I mean, you know, when you got average profits of over $80,000 per house, per property, I like $80,000 better than $8,000.
Jay Conner [00:21:49]:
Oh, and by the way, Edgar, an interesting point to make. Over these years, Carol Joy and I have had 47 individual unique private lenders.
Edgar Salgado [00:22:00]:
Wow.
Jay Conner [00:22:00]:
And by the way, I’m not talking hard money, talking private lenders, individual, a human being, right? That it’s a one-on-one transaction between you, the borrower, or your company and that individual. Well, interestingly enough, Edgar, over all these years, not one of those 47 private lenders ever heard about Private Money. They didn’t know what Private Money was. They never heard of self-directed IRAs until I did what? A podcast. Until I put on my teacher hat, Private Money teacher. So that’s the mindset, right? That’s the mindset: leading with education, leading with serving others. And, and, and a big, big critical point is: never talk about a deal that you’ve got under contract that you’re looking for funding, and it’s your first conversation with a potential private lender. The worst time to be looking to raise money is when?
Jay Conner [00:22:59]:
You need it for a deal. Don’t fall into that trap because you know what? Desperation has a smell to it, and people can tell if you are desperate, right? So you separate those conversations. First, you offer the opportunity, how you’re going to protect them, the interest rate you’re going to pay, how it’s a conservative loan-to-value, etc. And then you come back a little later and deliver on your promise to put their money to work for them.
Edgar Salgado [00:23:36]:
Jay, your first private lender handed you $250,000. What did you say to that person to earn that kind of trust?
Jay Conner [00:23:46]:
Awesome. Well, also, the relationship comes first. So I’ve never met anybody new out of the boat without a relationship in place first, and then talk about Private Money. So this first private lender, uh, we went to church together. Uh, we had known each other for some time, and we went to Bible study on a Wednesday night. I went there in the foyer. I walked up to him. His name was Wayne.
Jay Conner [00:24:13]:
And I said, Wayne, I got something I want to talk to you about confidentially, uh, after Bible study. And he said, okay. So we got together afterwards. We went down into the nursery. We shut the door. And here’s exactly what I said to Wayne. I said, Wayne, I need your help. I said, Wayne, you know everybody in this town.
Jay Conner [00:24:34]:
And he did. He was the Zenith Television dealer back in the day when you didn’t get your TVs at Walmart. You got them from the Zenith Television dealer. Well, he’d put a TV in just about everybody’s house. In this town, he was very, very involved in the Rotary Club. And I said, Wayne, I need your help. I said, I’ve now opened up my real estate investing business by referral only for people I know and trust, and I’m now paying insane high rates of return to my investors and private lenders. When you run across somebody that’s complaining about making no money in the local bank, or they’re losing money in the stock market, would you refer them to me? And I’ll tell them about my opportunity and these rates of return that I’m paying.
Jay Conner [00:25:20]:
Well, what do you think Wayne said to me? Wayne looked at me, and he said, well, now, Brother Jay, what you got going on there? What kind of rate are you paying? And I said, well, Wayne, are you, are you saying you might be interested? He said, yes, I could be interested. I said, well, why is that? He said, well, we’re losing money in the stock market. We’re not making— we’re earning less than 3%, which is what it was in 2009 in a CD at the local bank. We’re earning less than 3% at the local bank. Uh, he says, what kind of rate are you paying? I said, well, Wayne, that sort of depends on the deal. I said, what sounds high to you? He said, well, I don’t know, maybe 5 or 6%. And I said, Wayne, I can’t pay you 5 or 6%, but I can pay you 8%.
Jay Conner [00:26:06]:
He said, ” Put me down for $250,000. And so that next afternoon, on Thursday afternoon, I went over to his and his wife’s home. I sat down, and I went over the entire opportunity: how they’re protected, how they can get their money back in case of an emergency prior to the note coming due, the maximum loan-to-value, and naming them on the insurance policy as the mortgagee. We give our private lenders the same protection as the local bank gets. And so after visiting with them, Edgar, and having 2 cups of coffee during that visit, that $250,000 actually became $500,000.
Edgar Salgado [00:26:46]:
Wow.
Jay Conner [00:26:47]:
And over time, they really did refer a lot of other private lenders to us that we did business with. But, you know, when you unpack that story, the trust and the relationship were already in place. That was already there, right? And then you come along, and you have this opportunity where they are actually given the same protection as the local bank. Then you put all that together- the relationship, the trust, the security that you’re giving them, you know, with documents that are filed on the public record- then everybody is protected.
Edgar Salgado [00:27:29]:
Go back to that day when he said yes, and then that money actually got wired. What was that feeling like? What did that unlock?
Jay Conner [00:27:37]:
Well, when I funded that first deal with them, the feeling was that the handcuffs were off of me because, you know, when you buy— when you borrow traditional money, hard money, uh, bank money, whatever, well, they’re making the rules. They’re, they are, they’re the underwriter, there’s the lender; they’re setting the interest rate; they’re setting the term; they’re setting the frequency of payments. Well, in this world, It’s a, it’s an upside-down flip. It’s a 180-degree different direction. You, as the borrower, you’re offering an opportunity. You’re not applying for a loan. Hey, I got— there are no applications. Hey, I got great news for you.
Jay Conner [00:28:20]:
You are already approved. You’re already approved, right? And so all you have to do is offer the opportunity and then deliver on your opportunity. So it’s a completely different conversation. Than applying and, and, and, you know, borrowing money from, from traditional banks. Very, very different. And so how did it feel? I knew I could then find— I could scale my business. I couldn’t scale my business with just, you know, a limited line of credit at the bank. But with private lenders, there’s no limit to the number of private lenders you can have.
Jay Conner [00:28:57]:
There’s no limit to the amount of Private Money that you can borrow. So you can really scale your business as, uh, as quickly and as much as you want to.
Edgar Salgado [00:29:08]:
Thinking about your deals that you’ve done with Private Money, what almost went wrong in a deal that people didn’t find out about, but you were able to clear it up and still prosper with the deal?
Jay Conner [00:29:20]:
Well, you know, we’ve done over 500 in all these years, and they never go as expected, right? They never go as expected. That’s why your protection and your mitigation of the risk are in your offer. It’s not in estimating the cost of repairs or a rehab on a single-family house correctly down to the penny. It never comes in exactly to the penny, right? And Murphy always lives in every house. Sometimes Murphy’s cousins and grandparents live in some houses, and you get a whole lot of stuff that you didn’t expect. So it comes down to mitigating your risk by buying the house at a deep enough discount that things can go wrong and everybody is still protected. Which leads me to the next point, and that is protecting and taking care of your private lenders is number one priority. Number one priority: taking care of them and looking out for their money just like you would your own, because they’re counting on you to do this.
Jay Conner [00:30:25]:
You know, when you start sharing the opportunity, and it’s, you know, it’s your program, your opportunity that you’re offering, I just sort of duplicate mine. It seems to work pretty well, right? But when you’re sharing that, then these private lenders, they’re looking to you to take care of them. As I said, not one of these 47 private lenders that have been funding our deals over these years has even heard of Private Money. Until we offer them the opportunity. So you’ve got to take care of them, pay them on time, make sure they’re paid. And how do you make sure you do that? Well, you need to know how to structure your deal, right? So if you’ve never used Private Money before, for goodness ‘ sake, work with somebody, whether it’s me or somebody else. Work with somebody who knows what they’re doing in this world and can help you navigate the minefield, so you don’t get blown up, right? So structure your deals correctly. Don’t pay more for properties than you should, and never let emotion come into play as to how much you’re going to offer on a property.
Jay Conner [00:31:34]:
It’s the math. The math always makes the decision. I’ve got a formula that I use on every offer that I make when I’m paying all cash with Private Money. And whatever that formula comes down to, That’s the maximum offer; then that’s it. Don’t— that’s one mistake real estate investors make starting: they pay too much for the properties because they want to do a deal so bad. Let the math make the decision.
Edgar Salgado [00:32:04]:
Part of the Dream Start Own podcast is to start. And if you haven’t started by getting your LLC, or if you need another LLC, use the link below to get with PCS Prime Corporate Services, and they’ll give you a consultation to walk you through getting your LLC. You can do it yourself, but they’re going to walk you through it. They’re not going to charge you more than what you would pay doing it yourself, and they know how to set up the LLC appropriately to be protected, to get your operating agreement, and to make sure that you’re coded correctly for the most business funding. Why do you want business funding? Because it doesn’t affect your personal credit as much, and you can get so much more to help you scale faster, move faster, and grow faster. So use the link below to get your LLC set up with Prime Corporate Services. Now back to the episode. Numbers don’t lie.
Edgar Salgado [00:32:50]:
Private Money is different from banks. So we’ve talked about that, or hard money lenders. Tell us about, from the 47 lenders, if there was one that originally said no and how you ended up changing their mind.
Jay Conner [00:33:03]:
Well, I can’t think of anyone that I’ve shared the opportunity with that didn’t come on board. And do it, because if they’ve got money or liquid capital or retirement funds, where else are they going to get these kinds of consistent returns safely and securely? Right? It’s not unsecured money, and I’ve never tried to talk anybody into doing it. Right? As I said, no chasing, no begging, no selling, no asking. I present the opportunity. And then the next thing that naturally happens is they’re telling me, well, how much they want to invest, how much they want to start with, or they’ll tell me about retirement funds, and then I’ll introduce them to the self-directed IRA company that I work with. So again, it’s no chasing. It’s all about serving and sharing the opportunity.
Edgar Salgado [00:33:57]:
For people who are going to invest with somebody, Let’s say they find somebody, what should they do to vet that person that they’re going to lend money to?
Jay Conner [00:34:08]:
Well, first of all, I would not be lending money to anybody that I don’t already know. I’m not going to be lending money to someone that I don’t already have some kind of track record with, some, some kind of relationship, unless it’s a referral. Now, I’ve received a lot of referrals from existing private lenders, and so that trust Transfers from who is doing the referring. But, um, secondly, you know, I don’t, I don’t want to loan money to a, uh, to a real estate investor unless they’ve got a track record of doing deals or they’re working with someone that has a track record of doing the deals. Um, you know, I’ve had several coaching clients come to me that, uh, real estate investors that haven’t done that many deals, but since we’re working together, they’re able to leverage my experience and my number of deals and my track record when I’m working with them. So you see that leverage transfers over to them. So I want to make sure that whoever’s borrowing the money knows how to structure the deal, that everybody is protected. And, um, and, and they know what they’re doing.
Edgar Salgado [00:35:31]:
Jay, you went from chasing deals and being bored doing it well, then Ron LeGrand told you to teach what you’re best at. What was that conversation like?
Jay Conner [00:35:44]:
Yeah, so, um, I started investing in 2003. In 2009, I started raising Private Money. And then a couple of years went by to 2011, to be exact, March of 2011. I, uh, I was bored, and I, uh, I called up Ron, and I said, Ron, what’s next? I said, um, you know, I’ve got a great, successful real estate investing business. I got a great team in place. I’m working less than 10 hours a week in the real estate investing business. I said, You know, well, what am I going to do next? He says, well, you need to just teach other real estate investors what you’re really good at. He said, ” What are you really good at? I said, well, I’m really good at raising Private Money.
Jay Conner [00:36:33]:
He says, well, you need to teach other real estate investors how to do it the way you do it. So in March of 2011, I had my first live event down in Atlanta, Georgia. And, um, so since March of 2011, here we are over 15 years down the road. I’ve been putting on live events. I speak at other real estate investing events, and it’s all teaching and sharing about raising Private Money the way we do it with no chasing, no begging, no selling, no asking. It’s all about attracting the money. And, you know, since that time I’ve, um, I’ve got my own, um, you know, coaching clients. Mastermind that I run.
Jay Conner [00:37:18]:
And of course, I teach a lot of other things other than Private Money, but that’s the foundation. That’s the foundation. I teach how to find deals ahead of other real estate investors, how to get your business running on autopilot, how to sell any house in 3 days or less, how to rehab houses for people that are interested in that. So we do cover the gamut from A to Z, but it all started and starts with Private Money, getting the money lined up first.
Edgar Salgado [00:37:47]:
When you went into teaching, did you put away the company? Did you get rid of it?
Jay Conner [00:37:51]:
Oh no, I’m still just as— I’m still just as active today in the business. Um, I’m selling 2 houses tomorrow and buying another house this coming Monday. So yes, I’m running both businesses: the real estate investing business and, uh, coaching real estate investors. And I mean, why wouldn’t I? Why, why, why would I, why would I stop, you know, buying and selling houses when the profits are so great? And secondly, I just don’t know how a coach or an educator in real estate investing can, uh, actually be on top of things and current if they’re not still doing it themselves. Because, you know, when it comes to, like,e finding deals, what we did 5 years ago is very different from what we do today, uh, on some of the strategies that we use to actually locate motivated sellers of off-market houses.
Edgar Salgado [00:38:47]:
Yeah, I was wondering, so I assume you’ve gotten to the point of being Dream Start Own. At that point, you became an actual owner, not just an employee of that business. So you were able to have your team in place, your systems and processes in place, that you felt well enough to be able to step away from it to be able to focus more on teaching.
Jay Conner [00:39:07]:
So, you know, I still make all the offers on the properties, but I’ve had the same acquisitionist with me. Her name is Kim. She’s been with me for over 20 years. So she talks to all the sellers, but the majority of all of our communication takes place in our CRM, which, you know, keeps up with all of our sellers and where we are in the stages of it.
Edgar Salgado [00:39:31]:
If someone wants to learn Private Money System the way you teach it, where should they go?
Jay Conner [00:39:36]:
That’s a great question, Edgar, and I got 3 gifts for your audience. The first one is one of the most common questions I get, Edgar, from real estate investors that haven’t raised Private Money. They say, how do I start a conversation? How do I start a conversation with a potential private lender? Well, I have recently written my Private Money script: exactly what to say. It’s called the Curiosity Opener Script, and your audience can download it for free. It’s a PDF, and they can just go to www.JayConner.com/Scripts. Download that PDF right there. Second gift.
Jay Conner [00:40:22]:
Second gift is my national bestselling book called Where to Get the Money Now, subtitle: How and Where to Get Money for Your Real Estate Deals Without Ever Relying on Traditional or Hard Money Lenders. And you can get it on Amazon for $20, but don’t give Amazon $20 for the book. Let me give you the book for free. I’ll autograph it. I’ll express mail it to you. Uh, just cover shipping and handling. You can go to www.JayConner.com/Book.
Jay Conner [00:40:53]:
We’ll rush it right out to you. And then thirdly, um, my live event that I do in person, uh, 3 times a year, it’s called the Private Money Conference. We do it right here in eastern North Carolina, 3 full days of me talking about Private Money, and it’s a great networking event. You can check out all the details at www.ThePrivateMoneyConference. In fact, registrations are open right now for the next upcoming live event. And then, of course, my Lance, Edgar, I gotta tell your folks and your community about my podcast. Uh, we’re in our 9th year, and it’s all about Private Money.
Jay Conner [00:41:36]:
I do 2 shows a week, and I’m always interviewing other real estate investors and asking them how they go about Raising Private Money. And you can check out the podcast, Raising Private Money with Jay Conner. Raising Private Money with Jay Conner. It’s on all the popular podcast platforms. Very, very easy to find.
Edgar Salgado [00:41:59]:
Excellent. We’ll have all of that in the description below as well on YouTube for people to be able to click on it, making it easier to find.
Jay Conner [00:42:06]:
Excellent.
Edgar Salgado [00:42:08]:
We’re gonna go back and speak about, uh, Carol Joy. Your wife?
Jay Conner [00:42:12]:
Yes, Carol Joy.
Edgar Salgado [00:42:14]:
She was there when the bank cut you off from everything. What has she carried in this business that people watching from the outside never get to see?
Jay Conner [00:42:22]:
Well, she’s right down the hall, and she’s in charge and works in the bookkeeping. So she’s in the administrative, and I do not go in her office and tell her anything she needs to do. She’s in charge of all that.
Edgar Salgado [00:42:39]:
Excellent. With, uh, going back a little bit to the Private Money part, is there any specific deal that stands out that you could not have done with traditional funding that only worked with Private Money?
Jay Conner [00:42:52]:
Oh, absolutely. There’s a ton of them. And one, the one that comes to mind recently, is all about speed to close. So we were contacted by the owner of an oceanfront condominium. So we’re here in Morehead City, North Carolina. You go across the bridge to Atlantic Beach, North Carolina. And there was an oceanfront condominium and lots of motivation. It was inherited.
Jay Conner [00:43:17]:
The owner lived out of state. The property was facing foreclosure, and that foreclosure was going to happen in less than 2 weeks of us being contacted. So with Private Money, I had the Private Money lined up. We closed within 7 days. And, um, the purchase price was $460,000. If I hadn’t had $460,000 available in Private Money, I would have missed out on the deal. It would have gone to foreclosure. And, uh, in less than 6 weeks, we turned it around, put it in the Multiple Listing Service, and sold it for $630,000.
Jay Conner [00:43:59]:
And the renovation was less than $10,000. So we would have missed out on that deal having to use traditional funding. I mean, that’s one of the big reasons I love Private Money: the fact that speed to close. We all make all of our offers, and we can close in 7 days.
Edgar Salgado [00:44:19]:
Thinking about that deal with the family that was facing foreclosure, the people inherited, the heirs, what were you able to help them out of besides the foreclosure? Like, what, what was the benefit to them not getting it, letting it go through foreclosure?
Jay Conner [00:44:36]:
Well, that was the biggest benefit because they received almost $100,000 over the payoff. So not only did it keep it from going to a foreclosure sale at the courthouse steps, they had a big paycheck day.
Edgar Salgado [00:44:50]:
For the people listening who think that investors take advantage of people in foreclosures, change your mind.
Jay Conner [00:44:59]:
Yeah. Well, that’s a reputation that a lot of real estate investors have. And our mindset is all about serving those people who are facing foreclosure. In fact, we have been doing direct mail to people who are facing foreclosure since 2004. And when they respond to one of our letters, one of the first questions we ask them is, ” Do you want to keep your house? Do you want to keep your property? And if we can give them an idea on how to do that and they’re able to keep their property, then that’s great. There’s nothing in it for us directly, but there’s plenty, you know, there’s plenty to go around, plenty to go around. Another way we serve these people is by putting money in their pockets and helping them get back on their feet. So, you know, if you’re going to have an average profit of tens of thousands of dollars, can you not put some money in these people’s pockets even if they don’t ask for it? You’re able to buy those properties subject to the existing note, but you can put some money in their pocket.
Jay Conner [00:46:02]:
You can use Private Money in second position to bring the arrears current. So it’s all about serving those people. You know, when you lead with the other person in mind first, it takes all the pressure off of you to try to sell, trying to sell them something. Meet them where they are. Find out what it is they want to accomplish. What is their problem? And then ask good questions about how you can serve them and do what they, you know, want to accomplish.
Edgar Salgado [00:46:32]:
The people aspect of it is so, so important that a lot of new people getting into it don’t think about it. They’re always worried about that deal.
Jay Conner [00:46:40]:
Exactly.
Edgar Salgado [00:46:41]:
Going back to, uh, Carol, with her being in the business now, what’s the decision that the two of you made together that changed the whole direction of your business?
Jay Conner [00:46:53]:
Oh, we decided that she was going to be charging her areas of the business and I was going to be in charge of my areas, and we’re going to respect each other, and you run your part and I’m going to run my part, and we don’t get in each other— we don’t cross over each other’s Then, you know, wheelhouses. And that’s an important thing for a married couple or a partnership to have. You’ve got to decide who’s going to be responsible for what. Who’s going to be responsible for consistent leads coming in? Who’s going to be responsible for raising the Private Money? Who’s going to be responsible for making sure the bills get paid on time? Right? Who’s going to be responsible for making sure the money’s received? And all that. So you want to divide those responsibilities.
Edgar Salgado [00:47:41]:
Responsibilities need to be hashed out. It’s so important. I think so many people in partnerships miss that out. Going to your, your, when you’re teaching, um, a room full of investors, do you ever catch a piece of your dad in how you’re doing that?
Jay Conner [00:47:58]:
Um, well, a lot of people have told me that I talk like my dad. I don’t pick up on that necessarily as much, but all the conversations I have about making a difference, making an impact, leading with a servant’s heart, that’s all coming from Dad.
Edgar Salgado [00:48:18]:
That was a good presence he had around you.
Jay Conner [00:48:22]:
Absolutely. Well, Edgar, this is fantastic. Wow. I haven’t had this kind of a good conversation with an interviewer in some time, and I appreciate you having me come on so much and allowing me to give out the gifts to you. Thank you, Jay.
Edgar Salgado [00:48:38]:
We’re finishing up. Someone listening who has a deal right now and no bank willing to fund it, what’s the one thing you tell them to do ASAP?
Jay Conner [00:48:46]:
Um, download my script and get my book. Or if they just want to talk to me on the phone, uh, call up my office. They can go to www.JayConner.com. All my contact information is right there. Um, yeah, there’s a misconception. We’ve all been told that knowledge is power. That’s not true. Knowledge is not power.
Jay Conner [00:49:07]:
It’s the implementation of that knowledge that is power. So the question is, if you’re listening to this episode, what action are you going to take, or what actions are you going to take from what you’ve heard in this episode?
Edgar Salgado [00:49:24]:
Jay, you just handed people the exact system to fund deals without ever waiting on a bank’s permission again. Audience, if this helped you, do one thing for me. Hit like, subscribe,-it’s free- so you don’t miss the next one, and share it with one person who’s stuck waiting on a bank right now. Jay, thank you for being on the Dream Start Own podcast.
Jay Conner [00:49:46]:
Edgar, thank you so much for having me. My pleasure.
Edgar Salgado [00:49:50]:
I’m Edgar the Connector. Until next time, keep building.
Narrator [00:49:55]:
Are you feeling inspired by the knowledge you gained in this episode? Then head over to www.JayConner.com/MoneyGuide, that’s www.JayConner.com/MoneyGuide, and download your free guide that shares 7 reasons why Private Money will skyrocket your real estate investing business right now. 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.