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“Revolutionize Your Investing: Jay Conner on Leveraging Private Money in Real Estate”
https://www.youtube.com/watch?v=ivHYcpky90Y
In an enlightening episode of the Raising Private Money podcast, Jay Conner, a seasoned real estate investor, joined Angel Gonzalez on Taking the Leap Into Commercial Real Estate Podcast and shared his transformative journey from relying on traditional banking systems to embracing private money lending. This shift not only revolutionized his investment strategies but also paved the way for a more lucrative and less stressful approach to real estate investing.
Jay Conner’s Background and Early Journey
Jay Conner embarked on his real estate investment journey in 2003, focusing primarily on single-family houses in a small market in Eastern North Carolina. With approximately 40,000 people in his market, Jay successfully made an average profit of $82,000 on 2-3 deals every month. Initially, he relied heavily on local banks for funding, which was a conventional approach but came with its own set of limitations.
The Turning Point in 2009
January 2009 marked a significant turning point for Jay. The global financial crisis prompted his primary banking partner, BB&T, to close his line of credit. This unforeseen setback could have been catastrophic. However, it led Jay to discover an alternative financing strategy through private money lending, introduced to him by his friend Jeff Blankenship. This discovery was a game-changer.
Understanding Private Money
Private money involves individuals using their investment capital or retirement funds to finance real estate deals. Unlike hard money, which is institutional and comes with stringent conditions, private money is more flexible and borrower-friendly. Jay emphasizes that private money lending allows borrowers to set the terms and conditions, making it a more appealing and less cumbersome option compared to traditional financial institutions.
Strategies for Attracting Private Money
Jay’s strategy for attracting private money was rooted in education rather than solicitation. He invested time in educating his community about private money and the benefits of self-directed IRAs. By leading with a servant’s heart and offering valuable knowledge rather than directly asking for money, Jay successfully attracted $2,150,000 in the first 90 days. Today, he manages $8,500,000 in private funds from 47 lenders.
The Importance of Having Funds Ready
One critical lesson Jay imparted was the importance of having funds lined up before securing deals. Contrary to the advice of some “gurus” who suggest finding a deal first and expecting the money to follow, Conner advocates for securing the money upfront. This allows for confident and swift offers, giving investors an edge in competitive markets.
Case Study: Quick Flip Success
In a riveting case study, Jay shared an experience where he initially accepted an offer too hastily. Subsequently, he received a better all-cash offer of $628,000 with no contingencies and a quick closing date for a property he bought for $425,000. This deal underscores the flexibility and speed that private money lending affords, enabling investors to capitalize on lucrative opportunities without the delays typical of institutional funding.
Launch of the 7-Day Private Money Challenge
To help others achieve similar success, Jay launched the “7 Day Private Money Challenge.” This initiative includes seven days of video training on raising private money, released daily. The challenge aims to empower participants with the knowledge and tools needed to attract private funding effectively, fostering greater confidence and success in real estate investing.
Private vs. Hard Money: A Critical Distinction
A key takeaway from Jay’s discourse is the differentiation between private and hard money. Hard money is institutional, comes with rigid terms, and often carries a negative connotation due to its inflexibility. In contrast, private money dealings involve individual investors, offering more personalized and negotiable terms. This distinction is crucial for investors seeking more control and better terms for their deals.
The Role of Mastermind Groups
Jay highlights the transformative power of mastermind groups in both personal and professional development. He discovered the concept of mastermind groups in 2009 and has since been actively involved in various high-level real estate masterminds. These groups provide invaluable insights, shared goals, and collective wisdom, helping members avoid costly mistakes and achieve significant breakthroughs.
Mindset and Accomplishment
Jay emphasizes the importance of having the right mindset for success. Surrounding oneself with like-minded individuals and maintaining a positive, growth-oriented mindset can significantly impact one’s professional journey. Jay’s success story is a testament to the power of mindset, education, and strategic networking.
Conclusion
Jay Conner’s journey from traditional banking to private money lending offers a wealth of knowledge and inspiration for real estate investors. By focusing on education, strategic networking, and maintaining a servant’s heart, Jay has revolutionized his approach to real estate investing, achieving remarkable success and financial freedom. His insights and strategies serve as a valuable guide for anyone looking to navigate the complex world of real estate investment with confidence and proficiency.
10 Lessons Discussed from this Episode:
- Real Estate Profits
Description: Jay Conner achieves an impressive $82,000 average profit per deal on single-family houses, even in a small market of 40,000 people. - Bank Dependency Pitfalls
Description: The 2009 financial crisis highlighted the risks of relying solely on traditional bank funding, as Jay’s bank line of credit was abruptly closed. - Discovering Private Money
Description: Introduced to private money lending and self-directed IRAs by a friend, Jay learned about using individual investors’ capital for funding real estate deals. - Teaching Over Asking
Description: By educating others about private money rather than directly asking for funds, Jay successfully raised $2,150,000 in private money within the first 90 days. - Servant’s Heart Principle
Description: Emphasizing the importance of a servant’s heart, Jay focused on providing value and opportunities, which led to significant funding success. - Surplus Funding
Description: Jay’s educational approach resulted in attracting $8,500,000 in private money from 47 private lenders, showcasing the power of relationship-building. - Setting Deal Terms
Description: Using private money allowed Jay to dictate the terms of his deals, unlike hard money lenders who impose strict conditions and requirements. - Importance of Masterminds
Description: Joining mastermind groups played a crucial role in Jay’s personal and professional breakthroughs, providing valuable networking and learning opportunities. - Marketing and Closing
Description: Innovative marketing techniques, including drone footage and professional videos, helped Jay sell a property for $610,000 within a week, demonstrating the effectiveness of strategic marketing. - Leveraging Individual Investors
Description: Empowering regular individuals, such as retired teachers and civil service workers, as private lenders offered more flexible and stable financing alternatives to institutional funding.
Fun facts that were revealed in the episode:
- Jay Conner raised $2,150,000 in private money within his first 90 days of educating his community—without directly asking for funds.
- Conner’s best all-cash offer was $628,000 for a property he bought at $425,000, renovated for $11,300, and paid $31,000 to his realtor.
- He successfully marketed an oceanfront condo using drone footage and professional videos, leading to an over-list all-cash offer that closed in 7 days.
Timestamps:
00:01 Raising Private Money Without Asking For It
03:50 Lost credit line during the global financial crisis, discovers Private Money
10:07 Napoleon Hill’s “Mastermind”: Collective wisdom from groups.
10:57 Mindset is crucial for success in real estate.
16:42 Distinguish between private money and hard money.
18:50 Widow invests $1,250,000 retirement in real estate.
22:51 Use self-directed IRA funds to gain excess.
25:15 Borrow $150k, buy for $100k, gain $50k.
27:28 Private money: no credit checks, close quickly.
31:01 Motivated sellers search on Google
36:22 Patience pays: The next offer was $628,000 cash.
37:23 The Money Comes First
Private Money Academy Conference:
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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
https://www.JayConner.com/MoneyPodcast
Jay Conner is a proven real estate investment leader. He maximizes creative methods to buy and sell properties with profits averaging $67,000 per deal without using his money or credit.
What is Real Estate Investing? Live Private Money Academy Conference
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