Guest Appearance
Credits to:
https://www.youtube.com/@JohnCasmonMultifamily
“5 Steps to Raise Private Money with Jay Conner, Ep. 419”
https://www.youtube.com/watch?v=wkFic8doqB4
Securing funding is one of the greatest challenges real estate investors encounter, especially when traditional sources suddenly dry up. This was the reality for Jay Conner, who experienced a dramatic turning point in 2009. For years, he relied on conventional bank loans to fund his deals, but with the onset of the global financial crisis, his dependable stream of capital was abruptly shut off. Faced with the sudden closure of his line of credit, Jay Conner was forced to seek alternative ways to fund his investments—and what started as a setback soon became a catalyst for unprecedented growth.
The pivotal moment came with a simple phone call. Jay Conner reached out to fellow investor Jeff, who introduced him to private money—a different way to fund deals that doesn’t rely on institutional lenders or hard money brokers. This revelation inspired Jay Conner to quickly educate himself about private lending, particularly how individuals, rather than companies or funds, could serve as lenders using both personal and retirement capital.
The crucial difference between hard money and private money was a game-changer. Hard money typically comes from companies that raise funds from individuals, then lend at double-digit interest rates, often with origination fees and rigid terms. In contrast, private money involves direct relationships with individuals—people in your network who may have funds in savings or retirement accounts yielding low returns. With private lenders, the real estate investor has much more flexibility and often gets better terms, such as lower interest rates, no points or fees, and even the potential to borrow the entire purchase price and rehab costs with minimal upfront payments.
Recognizing these advantages, Jay Conner shifted his approach. Instead of desperately chasing down money, he adopted a teaching mindset, educating people in his network about the benefits of private lending. He never positioned himself as a salesman or beggar. Instead, he focused on value—demystifying the process for others and showing them how they could earn strong, safe returns secured by real estate.
His process began with identifying connections within his existing network, particularly focusing on retirees or people likely to have investible capital. He’d reach out to them casually, establishing rapport, and asking one powerful question to prequalify interest: whether they had investment capital or retirement funds that weren’t achieving attractive, secure returns. If the contact expressed interest, Jay Conner would share educational material—a concise audio overview explaining private lending’s key concepts and advantages, deliberately crafted to inform rather than persuade. The goal was to make people curious, not pressured, allowing them to self-select into learning more.
When a potential lender expressed further interest, Jay Conner would walk them through the exact program, explaining rates, terms, safety protocols, and how their funds would be secured by real estate with documentation like promissory notes, mortgages, or deeds of trust, and proper insurance and title protection. Only after all questions were answered and the lender verbally pledged funds would Jay Conner match those funds with a specific deal. He’d call with the key facts: location, after-repair value, required funding amount, and closing timeline—never asking if they wanted to participate, but instead simply informing them how and when their money would go to work.
This education-centric approach proved transformative. In less than ninety days, Jay Conner attracted over $2.1 million in new funding, surpassing what he had ever had from banks. Private funding enabled him to seize deals traditional investors couldn’t access during the foreclosure wave, tripling his business in a down market.
For real estate investors, Jay Conner’s journey underscores the power of education, mindset, and structured processes when raising private money. By focusing on teaching rather than asking, and by protecting his lenders’ interests at every step, he built a self-sustaining framework where the right people pursue him with investment capital. The key takeaway: Never chase, beg, or sell—instead, serve and educate. When you put others first and provide real opportunities, the money chases you.
10 Discussion Questions from this Episode:
- Jay Conner emphasizes the distinction between private money and hard money. How do these differences impact a real estate investor’s flexibility and control over their deals?
- In the episode, Jay Conner describes being unexpectedly cut off from traditional bank funding in 2009. How might today’s investors prepare themselves for similar disruptions in the lending environment?
- Jay Conner introduces a “magic question” when approaching potential lenders. What do you think makes this question so effective, and how could it be adapted for other investment opportunities?
- Discuss Jay Conner’s five-step process for raising private money. Which step do you think is most critical, and why?
- Why does Jay Conner advise never to ask potential lenders if they want to fund a deal? How does this approach change the dynamic between investor and lender?
- The episode stresses the importance of educating your potential lenders rather than pitching or selling to them. What are some effective educational approaches you would use?
- Jay Conner talks about only accepting funds via third-party entities or attorneys, rather than personal checks. What legal and practical risks does this precaution mitigate?
- How does Jay Conner structure legal protections for his lenders, and why is this essential to building trust with private investors?
- The mindset shift from chasing money to attracting it is a recurring theme. How can real estate investors develop this “teacher” mindset in their own networking efforts?
- Jay Conner shares a failure from early in his career—investing in a property without ensuring the rental income would cover carrying costs. What lessons can be drawn from this story for both new and experienced investors?
Fun facts that were revealed in the episode:
- Jay Conner was able to attract over $2.1 million in private money within just 90 days after learning about the concept, which helped him triple his business during a period when banks were not lending to real estate investors.
- Instead of asking for money directly, Jay Conner focuses on educating his network about private lending opportunities and uses a 16-minute audio, “Stress-Free Investing,” as a key part of his approach.
- Jay Conner never accepts personal checks from private lenders; all funds go through the appropriate entity to the attorney or closing agent, ensuring both parties are protected and minimizing risk.
Timestamps:
00:01 Private Money vs. Hard Money
05:45 Bank Cuts Credit Amid Crisis
08:02 Attracting Private Funding Quickly
12:25 Leveraging Self-Directed IRA Insights
16:01 5-Step Process for Deal-Making
18:42 Educate, Empower, and Streamline Decisions
21:43 How to Start Real Estate Funding
27:11 Retirement Account Best Practices
34:32 Lesson from a Real Estate Mistake
37:47 StairMaster for Focus and Productivity
39:30 Private Money Insights with Jay
Free Report:
https://www.jayconner.com/MoneyReport
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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.
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