Private vs Hard Money: Real Estate Insights and Success Stories from Jay Conner

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

“Secrets Of Rich: Use Other People's Money | Jay Conner.”

https://www.youtube.com/watch?v=WnXWripgNVM&t=91s 

For many real estate investors, accessing capital is the key to taking advantage of opportunities and scaling up their portfolios. But while traditional banks and mortgage companies have long dictated the rules of borrowing, a different path exists for those ready to take control: private money lending. This approach offers an investor-centric alternative that can create bigger profits and enable greater agility in today’s competitive real estate environment.

Private money, as explained by Jay Conner on a recent guest episode with Matt McKeever, is all about borrowing directly from individuals—often referred to as “mom and pop” or “relationship money.” Unlike institutional hard money lenders or banks, private lenders are everyday people, sometimes even within your existing network. The difference? Instead of jumping through endless hoops and paying high fees, private money lending lets you set the terms and structure deals for mutual benefit.

Jay Conner’s personal real estate journey showcases the potency of private capital. Starting in a small community, he and his wife transitioned to using private funds after getting cut off from banks in 2009. Within 90 days, he raised over $2 million from private sources—leading to a tripling of his business within the first year. Since making the shift, he’s not missed out on a single deal due to a lack of funding.

The advantages of private money go far beyond just providing cash. Unlike equity partnerships or traditional JVs, which may require sharing profits and decision-making, private lending is structured as debt. This means you keep full ownership and control while offering the lender a secure, collateralized investment. For those worried about credit checks or borrowing limits, private money is a game-changer—you can borrow as much as you can manage, from as many lenders as you connect with, across the country or even internationally.

One of the most compelling features: the ability to borrow more than just the purchase price. It’s common practice to roll rehab funds and even equity into the loan, which provides flexibility and improves cash flow for the investor. Many deals can be funded with no out-of-pocket money, allowing you to be paid at closing and cover renovations without dipping into personal reserves.

While hard money lenders have become a mainstay for some, their terms can be punishing—often charging double-digit interest and expensive points, with strict timeframes for payback. Private money typically comes with much friendlier rates and terms, minimal fees, and no extension penalties. Most importantly, the process is relationship-driven, allowing you to create win-win solutions and close deals quickly—sometimes within just a week.

The next logical question is: Why would someone want to lend privately? The answer lies in the security, return, and certainty that the investor’s offer provides. Typical alternatives for savers—like certificates of deposit—offer paltry yields, while the stock market’s volatility sends many seeking more predictable opportunities. Private lending offers borrowers high, reliable returns, secured by a physical asset with a conservative loan-to-value ratio. These features make the offering attractive to those with idle cash or retirement funds.

Building your private lender network may seem daunting, but your warm market—existing contacts, friends, club members, or professional acquaintances—is filled with potential candidates or referrals. Rather than pitching or beggin