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Transitioning from Traditional Banking to Private Funding: Jay Conner’s Journey


***Guest Appearance

Credits to:

https://www.youtube.com/@TheSourceCRE 

“Finding Investment Capital in Private Money with Jay Conner”

https://www.youtube.com/watch?v=MV3Ed6buyfI&t=26s  

In a recent Raising Private Money podcast episode, Jay Conner joins Jonathan Hayek, a former teacher turned commercial real estate investor, they share invaluable insights about private money lending. Their discussion shed light on practical strategies, community involvement, and building trust-based relationships to secure private money for real estate deals.

Emphasizing Simplicity and Flexibility

No-Penalty Approach: A Win-Win Situation

Jay Conner highlighted the simplicity and flexibility of his private money program. Unlike traditional banking systems, his approach eliminates penalties for early repayments by lenders. Over the years, he has had only two small notes called due early due to medical emergencies. This flexibility benefits lenders who prefer to keep their money generating returns rather than having it returned prematurely. Jonathan Hayek concurred, noting that his lenders also favor keeping their money invested for continued financial benefits.

Securing Loans: Importance of Legal Documents

Promissory Notes, Trust Deeds, and Mortgages

A pivotal aspect of securitizing loans involves proper documentation. Jay explained the roles of promissory notes, deeds of trust, and mortgages in protecting both lenders and borrowers. Promissory notes capture all loan specifics, such as borrower details, loan amounts, interest rates, and payment schedules. Deeds of trust or mortgages grant lenders the authority to foreclose if borrowers default. Adding further layers of security, Jay emphasized adding lenders on insurance and title policies. These additional protections ensure that both parties’ interests are safeguarded, making the investment process transparent and trustworthy.

Identifying Suitable Borrowers

Understanding Who Should and Should Not Borrow

Jonathan Hayek queried Jay about scenarios where private money lending might not be appropriate. Jay addressed the question thoughtfully. Not every individual or situation aligns with private money lending. Traditional banking or hard money loans might be more suitable for some. Jay cautioned against borrowing private money without a thorough understanding of real estate. Investors must comprehend property valuation, management, and rehabbing, making decisions based strictly on mathematics rather than emotions.

Building Thriving Networks

Leveraging Business Networking International (BNI)

One of the keys to Jay’s success in securing private money has been his involvement with Business Networking International (BNI). BNI’s structure allows only one representative per profession in each chapter, fostering trust and encouraging referrals. By joining BNI as a real estate investor, Jay unlocked the potential of a robust network quickly, securing millions in private money.

Community Involvement: A Trust Booster

Principle of “Givers Gain”

Jay and Jonathan underscored the importance of community involvement in gaining trust and attracting private money. Engaging with local organizations like the Chamber of Commerce, Rotary Club, church groups, and Real Estate Investing Associations (REIAs) not only builds visibility but also trust. The principle of “givers gain” is central; by serving and giving to the community, individuals earn trust, making it easier to forge investment relationships. Jay’s active volunteering and consistent networking have established him as a reliable and giving individual, hence attracting significant private investments.

Consistency in Lending Terms

Clear, Reliable Borrowing Practices

Jay’s success is also credited to his consistent lending terms since 2009. He offers a straightforward, no-frills approach: 8% annual interest, no origination fees, points, or extension fees, a two-year loan term, and collateralized loans up to 75% of the after-repair value. This consistency has built immense trust among his private lenders.

Understanding and Educating Lenders

Shifting Mindsets for Long-term Benefits

Jay has a unique approach to securing private money by educating prospective lenders. By positioning himself as a “private money teacher,” he ensures that lenders understand the concept thoroughly, making the money chase him rather than the other way around. His proactive education strategy means setting terms and rates himself, without directly asking for funding. He elaborates on different types of lenders: Private Money and Hard Money. Private money comes from individuals’ funds, offering flexibility and pre-existing trust-based relationships, unlike institutional hard money lenders, who typically have higher interest rates and fees.

The “7-Day Private Money Challenge”

A Step Towards Mastery

To further assist individuals in understanding and securing private money, Jay introduces the “7-Day Private Money Challenge.” This initiative offers detailed training through daily short videos, guiding aspiring investors through the intricacies of private money.

In conclusion, this episode reiterated the essence of building long-term, trust-based relationships within various community groups and consistently maintaining clear borrowing practices. Jay Conner’s journey affirms that with the right knowledge, mindset, and community involvement, securing private money for real estate deals becomes a robust and rewarding strategy. Reach out to learn more about the enriching world of private money and begin your journey toward financial independence and success.

10 Discussion Questions from this Episode:

  1. Understanding Terms: Jay Conner mentions a “no-penalty approach” for private lenders. Can you explain what this means and how it benefits both lenders and borrowers?
  2. Importance of Documentation: Why are promissory notes and deeds of trust or mortgages critical in securing loans according to Jay Conner? How do they protect the interests of private lenders?
  3. Flexibility in Lending: Considering Jay Conner’s flexible loan terms since 2009, how does his approach differ from traditional banks and hard money lenders?
  4. Networking Benefits: How has Jay Conner utilized Business Networking International (BNI) to secure millions in private money? What aspects of BNI contribute to building trust and growing one’s network?
  5. Community Involvement: Discuss the principle of “givers gain” that Jay and Jonathan highlight. How does volunteering and community involvement lead to investment opportunities?
  6. Appropriate Borrowers: In what scenarios does Jay Conner suggest using traditional banking or hard money loans instead of private money? What characteristics make someone more suitable for private money lending?
  7. Educational Role: Jay Conner emphasizes the importance of educating potential private lenders. How does this education build trust and ensure smoother financial transactions?
  8. Risk Mitigation: What strategies does Jay Conner implement to mitigate the risks for both the borrower and the lender in private money lending?
  9. Mindset for Raising Funds: How does Jay Conner’s mindset and confidence play a role in attracting private lenders? Why is having an abundance mindset crucial in this context?
  10. Lessons from Experience: Jay Conner shares his journey of shifting from bank financing to private money. What key lessons did he learn from this transition, particularly during the global financial crisis in 2009?

Fun facts that were revealed in the episode:

  1. Jay Conner raised $2.15 million in private money in less than 90 days in his local area without directly asking for it.
  2. Jay Conner’s private lenders include ordinary people like school teachers and civil service workers who had never heard of private lending before.
  3. Jay secured millions in private money through connections made at Business Networking International (BNI) meetings.

Timestamps:

00:01 Raising Private Money Without Asking For It

04:41 Steve halted funding due to the financial crisis.

06:22 Learned about private lending, raised $2.15 million.

13:00 Private money flexibility vs. institutional hard money fees.

16:22 Focus on growing your network for success.

19:36 Join local BNI for networking and leads.

22:30 Volunteer sincerely; rise within community; become valuable.

24:17 Consistent interest rates despite market fluctuations since 2009.

29:21 Lenders prefer trusted borrowers over idle money.

31:34 Payment frequency, cash flow, promissory note, mortgage.

36:25 Don’t borrow private money until knowledgeable and prepared.

40:09 They prefer active involvement over being a lender.







Private Money Academy Conference:

https://www.JaysLiveEvent.com

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

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

https://youtu.be/QyeBbDOF4wo

YouTube Channel

https://www.youtube.com/c/RealEstateInvestingWithJayConner

Apple Podcasts:

https://podcasts.apple.com/us/podcast/private-money-academy-real-estate-investing-with-jay/id1377723034

Facebook:

https://www.facebook.com/jay.conner.marketing

Twitter:

https://twitter.com/JayConner01


Pinterest:

https://www.pinterest.com/JConner_PrivateMoneyAuthority


Listen to our Podcast:

https://www.buzzsprout.com/2025961/episodes/15859922-transitioning-from-traditional-banking-to-private-funding-jay-conner-s-journey

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