Money Chases You: Real Estate Funding Secrets with Jay Conner

Money Chases You: Real Estate
Funding Secrets with Jay Conner

How to Raise Private Money for Real Estate Investing

🎙️If you’re a real estate investor tired of begging banks for loans, jumping through hoops for hard money lenders, or risking your own capital, this episode of the Marketing Boost Solutions Podcast is your game-changer. Captain Marco sits down with Jay Conner, known as the Private Money Authority, to discuss the art and science of raising private money for real estate deals. Jay’s approach is not just about finding funding; it’s about attracting it, structuring it safely, and building a business where money chases you.

Below, we break down the main themes and actionable strategies from the episode, offering you a comprehensive guide to mastering private money for real estate investing.
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1. Jay Conner’s Journey: From Bank Shutdown to Private Money Mastery

Jay’s transformation from dependent borrower to private money powerhouse began during the 2009 banking crisis, when banks suddenly pulled the plug on his credit lines. Rather than give up, he reframed the question—not how to get money, but who has it and needs a better return.

Key Lessons:

• Think Small, Win Big: Jay built a thriving business in a town of 40,000—proof that private money works anywhere.

• Tap Into Relationships: When traditional lenders failed, Jay turned to his network.

• Educate to Empower: He didn’t beg for capital—he educated people, built trust, and let the money come to him.

2. Private Money vs. Hard Money: What’s the Difference?

Many investors confuse private money with hard money, but the differences are critical:

Hard Money Lending

• Institutional: Hard money lenders are companies or funds.

• Expensive: Typical rates are 12–15% interest, plus 2–4% origination fees and extension fees.

• Short Terms: Usually 6–9 months.

• Strict Rules: Lender sets the terms, often requiring significant down payments.

Private Money Lending

• Individual Investors: Friends, family, acquaintances, or connections from networking.

• Flexible & Cheaper: Jay pays 8% interest, no points, no origination fees.

• Longer Terms: 2–5 years, depending on the source of funds.

• You Set the Rules: As the borrower, you structure the deal, not the lender.

Actionable Insight:
If you want control, flexibility, and better terms, private money is the superior choice. You become your own underwriter.

3. The Private Money Blueprint: Attract, Don’t Chase Capital

Jay’s golden rule? Never ask for money.

Adopt the “Teacher, Not Pitcher” Mindset

• Educate First: Help prospects understand what private lending is, how it's secured, and what returns they can expect.

• Use the “Good News” Call: Share a compelling opportunity—not a plea for funds.

• Host Private Lender Luncheons: Educate groups of prospects in a relaxed setting. Jay once raised nearly $1M at a luncheon—without presenting a deal!

Sample Script:
“Would you be interested in learning how to earn high, safe returns backed by real estate, without being a landlord?”

4. Structuring Private Money Deals: Safe for Everyone

Jay’s private money deals are structured to minimize risk and maximize flexibility—for both parties.

Core Components:

• Interest: 8% annual, paid quarterly or monthly

• No Points or Origination Fees

• Secured: Each loan is backed by a deed of trust

• Equity Cushion: Never borrow more than 75% of ARV

• Insurance & Title: Lender named on both

Substitution of Collateral

If a property sells, Jay substitutes new collateral—keeping the lender’s money actively working.

Pro Tip:
If you’re not walking away from the closing table with a check, you’re paying too much.

5. Finding Private Lenders: Where and How

Jay categorizes private lenders into three main groups:

1. Warm Market

• Friends, family, colleagues

• Community groups (church, Rotary, sports clubs)

2. Expanded Network

• Referral introductions

• Networking groups like BNI

3. Existing Private Lenders

• Private Lender Data Feeds: Search for active lenders by region

• Self-Directed IRA Custodians: Attend events—they host thousands of potential investors

Action Steps:

• List people in your circle who may have capital or retirement funds

• Host educational events

• Network strategically—focus on relationships, not pitches

6. Keeping Lenders Happy: Long-Term Success

Once you’ve attracted lenders, your job is to manage the relationship—and their money—with care.

Best Practices:

• Deploy Quickly: Fund their first deal fast

• Avoid Idle Funds: Reinvest promptly to avoid money sitting idle

• Communicate Clearly: Keep lenders updated

• Secure Their Interests: Proper documentation, insurance, and title protection

Jay’s Analogy:
“Private money is like bananas—you have to use it before it spoils.”

7. Common Pitfalls (and How to Avoid Them)

Pitfall 1: More Money Than Deals

Fix: Build a strong deal flow through multiple lead sources (Jay uses 7+ vendors)

Pitfall 2: Overpromising Returns

Fix: Stay sustainable—8% interest is competitive and responsible

Pitfall 3: Poor Deal Structure

Fix: Never borrow more than 75% ARV and always secure the loan

Pitfall 4: Letting Buyers Pay Lenders

Fix: Stay in control—you repay your lenders, not the end buyer

8. Final Advice: Take Action and Build Your Empire

Jay’s parting wisdom is clear: Nothing changes unless you take action.

Connect with Jay below!
Website: www.JayConner.com
Facebook: https://www.facebook.com/jay.conner.marketing
Linkedin: https://www.linkedin.com/in/privatemoneyauthority/
YouTube: https://www.youtube.com/@raisingprivatemoneyrealestate
Instagram: https://www.instagram.com/privatemoneyauthority/