How to Raise Private Money for Real Estate Deals | Jay Conner

Jay Conner (00:00)
You got to number one.

Own the real estate between your ears. Now, what do I mean by that? I mean, by having the right mindset. So let me dive into that for just a moment. What I mean by having the right mindset. What I’m talking about is understanding that 99.99 % of people walking on this planet believe that whoever’s got the money, the bank, the mortgage company.

The hard money lender.

They believe that whoever’s got the money to loan out sets the terms, the underwriting, the interest rate, the frequency of

payments, the maximum loan to value and all that. So here’s the very first mindset piece. Turn that upside down. In this world of raising private money, we’re not asking for money. We’re not begging. We’re not chasing. We’re not selling. We’re not persuading. We’re not even filling out any application forms. I’ve got great news for you. You’re already approved. And here’s why. Because you

The real estate investor, the entrepreneur, the borrower of the money. What you’re doing is you’re not asking for money. You’re offering an opportunity.

Dylan Silver (02:42)
Hey folks, welcome back to the show. Today’s guest, Jay Conner is a real estate investor based in Eastern North Carolina. He’s been buying and selling houses since 2003 in a small market of about 40,000 people. Over that time, he’s completed more than 500 deals and averages around 86,000 in profit per deal. He’s built a seven-figure real estate business that’s now systematized to the point where he works less than 10 hours a week.

Outside of single family investing, he’s also a commercial investor in deals like shopping centers and condo developments. He’s best known for teaching investors how to raise private money without asking for it. And after losing a bank line of credit in 2009, he raised over 2.1 million in just 90 days using this approach. He’s helped over 2000 investors learn how to fund deals this way and is known as the Private Money Authority. Jay, thanks for taking the time today.

Jay Conner (03:33)
Dylan, thank you so much for inviting me to come along and talk about what I’m so excited about, so passionate about, and that is private money for real estate deals. And the reason I’m so excited about it is because this one skill set, this one strategy, when, ⁓ when I see real estate investors that I’m able to work with, get this dialed in and master this.

They never miss out on any deals for not having the money. And you know, when I started raising private money all the way back in 2009, Dylan, since that time, I’ve never missed out on a deal for not having the money.

Dylan Silver (04:12)
We were talking in the green room, Jay, that’s the biggest bottleneck that investors have is they’ll get to a point where they realize, you know, we can’t just keep bootstrapping and they realize they need to raise capital, but they’re not sure what steps to take, right?

Jay Conner (04:27)
That’s right. It’s like, you know, one of the most common questions I get is, know, like, well, Jay, how do I even start? How do I even start raising capital? What do I say? What do I do? Who do I approach?

And Dylan, I want to share with your audience. Here is the very first step. Here’s the very first thing that someone needs to do to start raising capital for real estate. And here it is.

You got to number one.

Own the real estate between your ears. Now, what do I mean by that? I mean, by having the right mindset. So let me dive into that for just a moment. What I mean by having the right mindset. What I’m talking about is understanding that 99.99 % of people walking on this planet believe that whoever’s got the money, the bank, the mortgage company.

The hard money lender. And by the way, when we talk private money, I’m not talking hard money, hard money is institutional money. Hard money is a brokerage. I’m talking private money, barring the money from individuals, human beings. Anyway, 99.99 % of the people walking around believe that whoever’s got the money makes the rules. They believe that whoever’s got the money to loan out sets the terms, the underwriting, the interest rate, the frequency of

payments, the maximum loan to value and all that. So here’s the very first mindset piece. Turn that upside down. In this world of raising private money, we’re not asking for money. We’re not begging. We’re not chasing. We’re not selling. We’re not persuading. We’re not even filling out any application forms. I’ve got great news for you. You’re already approved. And here’s why. Because you

The real estate investor, the entrepreneur, the borrower of the money. What you’re doing is you’re not asking for money. You’re offering an opportunity.

You’re offering an opportunity and guess what? You never have to pitch deals. And here’s why the secret sauce separating the conversation with a potential private lender, an individual that’s in your warm market to start with your own network. And the mindset is.

View yourself as having a servant’s heart and you are an educator. In other words, put on your hat. My hat says private money teacher, private money teacher. And you know what’s interesting Dylan is that Carol Joy, my wife and I, we’ve had 47 different private lenders funding our deals over all these years. And here’s the deal. Not one of them, not one of them had ever heard of private money.

or private lending or self-directed IRAs and how they can move their retirement funds over to a self-directed IRA and then loan that money out. And the interest we pay them is either tax deferred or tax free. None of them had ever heard about this world until I put on my teacher hat and I exposed them to this opportunity, never bringing up a deal.

Never bringing up a deal in the initial conversation, just sharing with them the opportunity. I’ve been paying my private lenders 8%, no points, no origination fees, no extension fees ever since February, 2009, even in all the ups and downs of the market. Been paying them 8%. They love it when you compare to what you can get in the local bank.

Dylan Silver (08:40)
Yeah.

Jay Conner (08:41)
And so when I share the opportunity and how the program works and how they’re protected and how they can get their money back early in case of an emergency and, and, know, how the program, the opportunity works. Then I say, well, so they tell me how much they want to invest, no deal attached to it yet. And then I tell them, I’ll put their money to work for them just as soon as possible. And then guess what? I call them up with the good news phone call.

And I get my deals funded 100 % of the time with the good news phone call. And here’s the good news phone call script. And Dylan, I’ll hand it back to you. So Dylan, let’s say that you and I go to church together. We’ve known each other for a while. We know, you know, we like each other, all that. And let’s also assume I’ve told you about this private money lending opportunity. Now I didn’t do it until I diagnosed that you have a problem.

And your problem was you’re not happy with the returns you’re getting on your investments. And so I shared the opportunity with you. You’d love it. And let’s assume you had $150,000 collecting dust in a old 401k at a previous employer. And you don’t, you know, you’re not happy with it. Let’s also assume I’ve introduced you to my self-directed IRA company that I recommend. You’ve talked to them, you’ve moved your $150,000 over to the self-directed IRA company.

And now you’re waiting for the good news phone call. So I call you up. You answer the phone. We have a little chit chat and here’s the exact script of the good news phone call. We say, hello. say, Dylan, I’ve got great news for you. 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 is 150,000, which matches up to what you’ve got in your self-directed IRA. And closing is going to be next Wednesday. You’ll need to have your funds wired to my real estate attorney’s trust account by next Tuesday. I’m going to have my real estate attorney email you the wiring instructions.

That’s the end of the conversation. The most stupid thing I could say or ask is

Do you want to fund the deal? Of course, Dylan wants to fund the deal for three big reasons. And here they are. Number one, Dylan trusted me to move his $150,000 over to the self-directed IRA company. Number two, Dylan knows I’m not going to bring a deal for him to fund unless it matches the criteria of the underwriting that I already taught him. He knows I’m not going to borrow more than 75 % of the after repaired value.

I didn’t say 75 % of the purchase price. We always bring home a big check when we buy properties. That’s called excess cash to close. So I told him the after repaired value was 200,000. Funding is 150,000, which matches up to what he’s got. That’s 75 % of the after prepared value. Now I bought it for a hundred thousand dollars. That’s why I’m bringing home a $50,000 excess cash to close check.

When I buy the property. then the third reason that Dylan is ecstatic about funding my deal is because he’s not making any money until he puts that money to work and loans me the money. So that’s an overview. mean, you know, the question is, are you starting to understand the flow of this to where you’re not chasing, begging, you know, and persuading? mean,

Dylan, I’m going to ask you a question. I’m going to take a little risk right now. I think I know the answer, but here’s the question. Have you ever heard the guru stand on stage talking to newbies, new real estate investors, and they’ll say something like, just get the deal under contract. The money will show up. You ever heard that? Yeah. Yeah. I want to throw up. That’s the most insane thing I ever heard in my life. I mean, you get a deal in the contract is like a drone going to fly over your front door.

Dylan Silver (12:57)
Yeah. Yeah, yeah.

Jay Conner (13:08)
porch and drop a bag of money on your step or, know, or they’ll say something like money finds good deals. Money finds good deals. Yeah. That’s stupid. Like is money got legs and it’s running around, you know, looking for it? No, no. It seems to make so much more sense to me. Get the money lined up first, burning a hole in your pocket and just think how much more confident, how many more offers are you going to make?

When you know you know you got the money ready to go and you can close within seven days. Back to you, Dylan.

Dylan Silver (13:41)
You know, that’s a huge.

difference in perspective between how everyone else approaches raising money, right? And because people look at it from a sense of unknown and of fear, but the reality is, as you mentioned, people have money that’s sitting in these accounts that they feel like isn’t doing much for them. And so rather than say, you I need money to raise capital for this deal, look at it as a service that you’re providing people who are otherwise maybe not thrilled with their returns, right? And so if you look,

go about it from that educational perspective from, here’s something that you can do, which maybe you haven’t thought of before, to where you could be more actively using your hard-earned dollars. That approach rings true, I think, to pretty much everybody, right?

Jay Conner (14:25)
Absolutely. mean, Dylan, when’s the worst time to be raising private money?

Dylan Silver (14:31)
Gosh. Yeah.

Jay Conner (14:31)
When you need it.

When you need it for a deal, right? I mean, that’s just downright stressful. And Hey, here’s a writer downer, ⁓ Dylan, for your audience, quote unquote, desperation has a smell to it. I mean, if I’m talking to somebody about my private lending opportunity and how they can make high rates of return safely and securely, and I got a deal for them to fund. I’m already sounding desperate, right?

Dylan Silver (14:46)
Yeah.

Yeah.

Jay Conner (15:00)
But when

we separate those conversations of here’s the opportunity, here’s the interest rates you can earn that I’ll pay you. Here’s how you’re protected. I’m not borrowing any unsecured funds. We give them the same protection as the local bank or mortgage company. They get the promissory note, they get a mortgage or a deed of trust that collateralizes that note. We name them on the mortgage. I mean, on the insurance policy is the mortgagee.

So there’s ever a claim on that insurance policy on that property, the checks made payable to them, the private lender and to, you know, you, who borrowed the money, your entity. So they got to sign off on that check. So they’ve got the same protection that the bank or the mortgage company gets.

Dylan Silver (15:44)
You mentioned that there’s some things people say a lot, which is if you find the deal, the money will come. And I’ve heard that quite a bit as well. And I’ve actually experienced that this isn’t always true. You know, if you get a deal under contract, now you’re back, especially as a new investor or wholesaler or, you know, anyone who is transacting in real estate. If you have a time deadline to meet and you have a property under contract and now you’re

really pushing to find someone to purchase that deal or at least to help you purchase it, that is not only stressful for yourself, you’re actually having to really learn on the fly. And I don’t hear enough people talking about the importance, again, regardless of which deal type you’re active in, it could be anything from wholesale, single family fix and flip to raising capital for larger deals, that capital raising portion should truly be a separate conversation.

for all the reasons that you mentioned.

Jay Conner (17:20)
Absolutely. And I mean, it’s just like, it’s downright stressful to be trying to raise capital for a deal you got under contract. And then if you can’t raise it for that particular deal, what is that doing to your reputation? I mean, if, you know, if you are, you know, talking with a wholesaler and they’ve got the deal under contract and they’re offering it to you and you can’t perform.

But when, but when you’ve got the money lined up and it doesn’t take long, mean, so many of my coaching clients, that work with me and learn how to raise the capital. It’s not out of the ordinary for them to get $500,000, a million dollars in 30 to 90 days, just ready to go and ready to fund deals. And you know, how much more confident are you going to be and make it offers when you know exactly. you know, time kills deals.

The more time that goes by between you talking with a prospective seller of a property and then closing on it, all kinds of things can go awry. So we make all of our offers to off-market owners for sale by owners that will close in seven days. I went under contract the day before yesterday on 387 Barrington Ridge and

Dylan Silver (18:11)
Yeah.

Jay Conner (18:36)
The owner can’t be out that fast, but we went under contract to close in seven days. So we’ll close using private money and seven days. And if they can’t be out of the house that fast, which most of the time they can’t, here’s a big secret that’s going to make all of you who are listening to this show right now, a bunch of money. And here it is closing seven days and offer to pay them 50 % of their proceeds at closing.

Then they get the, and they can live in the house for free for whatever length of time we agree upon. And they get the other 50 % of their proceeds when they vacate that gets more deals closed and, and, and less deals lost.

Dylan Silver (19:16)
100 % that’s going to be a big motivating factor for people versus a lease back where now they’re thinking, okay, well, I can maybe pay some type of penalty here. But if they’re waiting on 50 % of the funds and the proceeds of the sale of their home, I think they’ll find a way to to get on out of there. I do want to pivot a bit here, Jay, and ask you specifically about the mining of your sphere, right? If you’re not in a network of people,

who you feel like may be interested in investing in real estate or you don’t have high net worth individuals in your sphere, what would you recommend folks do to begin to have those conversations?

Jay Conner (19:55)
Sure. So there’s three categories of where you have private lenders. First of all, is your own network. They’re in your cell phone, right? Your professional circle, your social circle, your service circle. know, the entrepreneurs, where do you take your dry cleaning? Who do you buy a car from? Right? Who’s your CPA? Who’s your accountant? I mean, who’s your real estate attorney? Those are gatekeepers of people that have money. So that’s category one.

your own network. Secondly, is what I call your expanded network. If you want to scale your business, you’re going to have to grow your network eventually because eventually you’re going to run out of your own contacts, right? And so how do you grow that very, very quickly? Well, when I work with my coaching clients, I’ve got a long list of how to explode your network very, quickly. But I’ll tell you one right now that’s one of the best.

And that is I recommend to all of my coaching clients to join your local BNI, which stands for business networking international. There’s a BNI everywhere. So networking group and BNI business networking international, that organization founded years ago by Ivan Meisner. Each chapter is created for its members to give leads to each other.

And you have one-on-ones and you get to know your fellow members very, quickly and very deeply. so they refer people to you who are not happy with their returns and their investments that they’ve got going on. third category of private lenders are existing private lenders, existing private lenders. These are individuals that are already loaning money out to real estate investors. Well, how in the world do you find them?

Dylan Silver (21:26)
Yeah.

Jay Conner (21:41)
Well, there’s more than one way there’s public records. My coaching clients, I give access to my private lender data feed software that we update every month and get all private lender closings across the nation with their contact information. But in addition to that, self-directed IRA companies have networking events and 70 % or more of those self-directed IRA companies are individuals that have retirement funds.

And they are wanting to loan that money out to us real estate investors because they just want to have passive returns. So networking events at self-directed IRAs.

Dylan Silver (22:19)
That’s a good ⁓ gold nugget for folks. And I think wherever you’re getting started, you have to pick that one niche and just start, right? Because that’s oftentimes the first barrier to people is just that fear of inaction, of unknowing and not knowing where to start. Hopefully with the nuggets that we gave people today, they’ve got the momentum and motivation to go ahead and get started. Jay, we are coming up on time here.

any new projects that you’re working on and then as well what’s the best way for folks to reach out to you.

Jay Conner (22:52)
Well, the project that I’m working on is I’m planning on putting on the very best ever private money live event, June 10, 11 and 12, 2026. That’s going to be right here in Eastern North Carolina in our hometown. And it’s a $3,000 event. No other event like it on the planet. You’ll learn how to raise private money very, very quickly. The networking is amazing. A $3,000 event for you and a guest, but

Since you’re here on Dylan’s show, you get to come for free with only a $97 registration fee that secures your seat and your guest seat. I’m going to give you out that special URL right now. So you can go check out the private money conference. It’s jayconner.com and I’m an ER not an OR. So www.jayconner.com forward slash event jayconner.com forward slash event.

I’m going to be there all three days and I’d love to meet you in person. In addition to that, before you come to the event, go ahead and download my curiosity opener script. So this is one of my 12 private money scripts. can download it absolutely for free at jayconner.com forward slash scripts, jayconner.com forward slash scripts. And then thirdly, my national bestselling book.

where to get the money now subtitle, how and where to get money for your real estate deals without relying on traditional or hard money lenders. I will express mail this book to you. I’ll autograph it and inside the book, it gives you the entire opportunity that you can teach to your own network. Just like I do. You can pick up the book at jayconner.com forward slash book, jayconner.com forward slash book.

and I will rush it right out to you.

Dylan Silver (24:44)
Jay, thank you so much for joining us. Thanks for your time today.

Jay Conner (24:48)
Thank you, Dylan. Thanks for having me on. This was fantastic.