Fast No’s and Smart Lending + The Meaning of Life with Jevon Perra

Bryce:
Today, we’ve got a special guest, Mr. Jevon Perra. Thanks for joining us, Jevon. We’re connecting with other lenders, and I’m fairly new to this space. We’re learning and trying to help our audience. What’s great about private lending is there’s so much variety in how people approach it. I love talking to other lenders and investors to see how they run their business. It helps me improve mine and gives me more experience from people who’ve been in the trenches a lot longer than I have.

Can you introduce yourself and give us a quick elevator pitch?

Jevon:
Sure. Thanks for having me, Bryce. I’ve been in lending since 2004, which is hard to believe—it’s been 20 years! I’ve worked with all types of real estate: one-to-four unit homes, multifamily, commercial, you name it. Over the last three years, I’ve helped run a private money debt fund. We take capital from private investors, then we lend that money out on real estate deals. Most of my time is spent reviewing loan applications—on average, I look at 30 deals a day and say no to most of them. But that’s my job: making sure we only fund the best deals and protect our investors.

Bryce:
I love it. You’re using a 506(c) structure for your fund, right?

Jevon:
It’s a bit more complicated. We have five funds set up, each with slightly different structures. Most investors are accredited, but we do have a couple of funds that non-accredited investors can join. But honestly, my focus is on the front end—originating the loans, finding good deals, and ensuring we can pay our investors back with interest.

Bryce:
That’s great. I imagine it’s tough saying no to so many people. I’ve found it difficult as a newer lender because I want to help everyone, but as you said, you can’t help everyone.

Jevon:
Exactly. And you don’t get paid for those deals that don’t work.

Bryce:
Right, it’s a shame, because you’d be rich if you did!

Jevon:
Unfortunately, that’s not how it works.

Bryce:
Do you have a script you use when you turn deals down? What do you typically say when you have to say no to 29 out of 30 deals?

Jevon:
Oh, I’ve seen as many as 300 deals before I find one that works. When I turn down deals, I always try to educate the borrower or broker. I keep it quick but clear: “This doesn’t fit our criteria, but here’s what we do like.” I use email templates for responses. Once I find myself saying the same thing more than once, I turn it into a script. That way, I can quickly send a polite, professional “no” while still educating on what we look for.

Bryce:
I like that approach. It makes it easier to say no, while still being helpful. You’re not just shutting people down—you’re guiding them.

You’re not just shutting people down—you’re guiding them.

Jevon:
Exactly. Brokers especially appreciate a fast no. A slow no is frustrating—it’s the worst when you’ve been working on a deal for weeks, only to get a no at the last minute.

Bryce:
That’s a great point. It saves everyone time.

Jevon:
Exactly. Fast no’s are more appreciated than slow ones. And it’s always followed up with what we will do and what we’re looking for.

Bryce:
So, what’s an example of a really bad deal, versus a good one that you would actually fund?

Jevon:
A bad deal is one where the broker keeps sending me deals that don’t meet our criteria, even though I’ve told them multiple times what we like. If they don’t learn from that, I won’t keep looking at their deals. In terms of deal specifics, I care most about the loan-to-value ratio. Brokers might say it has great equity, but equity doesn’t tell me much if the loan is too high compared to the property’s value. I need a low LTV, a clear exit strategy (i.e. how they’ll pay me back), and the property itself needs to be in good condition. If I’m lending on a property with a 65% LTV and the borrower has a solid exit plan, that’s a good deal.

Bryce:
That makes sense. I’ve heard that in hard money lending, people say it’s all about the equity and collateral, not so much the credit score. But like you mentioned, if the exit strategy is to refinance and the borrower has a 400 credit score, how are they going to pay off the loan?

Jevon:
Exactly. There’s got to be a story behind it. If the borrower has a plan to fix their credit and refinance, I need to know how they’re going to do that in a year. It’s tough, because fixing bad credit takes time, and it’s not something that can happen quickly.

Bryce:
Right, it’s a process.

Jevon:
The biggest challenge is that brokers often want to get paid quickly, and they don’t always prioritize the safety of the investor. Some borrowers are savvy and know what info to withhold, so I’ve got to be extra cautious. I’m looking out for my investors, even if the broker or borrower might not always have the same priorities.

Bryce
It’s interesting that you say you work mostly with brokers. We don’t do that as much. We interface directly with borrowers. How does that work for you, though? Seems like it’d be more frustrating with that third-party involvement—it’s like playing telephone. Why not skip that part?

Jevon
It can be frustrating, sure, but there are some upsides. The downside is the extra cost and the communication challenges. You don’t always get the full picture because brokers sometimes hold back details to keep deals going. But going direct to consumer can be tough too. Retail clients often don’t respect your time, and you’re dealing with them during off-hours, especially weekends. Brokers help because they filter the noise. They also help us scale—there are tons of brokers out there, so marketing through them gets us exposure to a lot of deals. Borrowers? They’re harder to find and more expensive to reach.

Bryce
Good points. You also mentioned cross-collateralization. If someone has equity in multiple properties, how does that work? I know you’re encumbering those other properties, but from a documentation standpoint, how do you handle it?

Jevon
The simplest answer is title. Title tells us exactly what we need to do. If we’re encumbering multiple properties with one loan, title handles the specifics—what documents to file, ensuring clear title, and confirming the debt’s secured by the properties. We get an appraisal, check the value, and if everything looks good, we’re in. Usually, we’re in second position because there’s often existing debt on those properties. We don’t want to go behind a loan bigger than $1.5 million because we’d end up taking on that debt if we foreclosed. It just doesn’t make sense if the deal’s too lopsided.

Bryce
Yeah, that would be a nightmare. So if you end up in second position and the property defaults, can you foreclose even if the first lien holder doesn’t want to?

Jevon
Oh, absolutely. We can force the foreclosure. The key difference is we set the minimum bid at the total amount owed, including our second position debt. If the first lien holder forecloses first, they’ll set the minimum bid for their debt only. So if the opening bid is a million dollars, and we have a $500,000 second, we’re out of luck unless we decide to bid on it ourselves.

Bryce
Got it. Sounds risky. But if you end up with the property, how does it play out for you?

Jevon
Well, if we end up with the property, it’s usually because the borrower has been negligent. I don’t want the property, but sometimes it turns out to be a decent deal. We do the work, sell it, and recoup our investment. Sometimes we break even, sometimes even take a small loss, especially with the legal fees. But it’s rare—taking back a property is not something we aim for. We focus on getting the borrower to pay us back.

Bryce
It sounds like you’re trying to avoid the foreclosure process as much as possible. What percentage of deals actually default?

Jevon
About 10% of our deals go into some form of default, like being 30 days late. People are late all the time, especially with California’s laws where you can’t add extra penalties or interest for late payments. They just charge a small fee now. Foreclosures? Very rare—maybe one a year, if that. Most of the time, we can work with the borrowers and get them back on track.

Bryce
So, very few go all the way to foreclosure. That’s good.

Jevon
Exactly. We don’t want to take the property back, and most of the time, the borrower’s just avoiding the inevitable. We try to help them avoid that.

Bryce
And that’s why you make sure there’s enough equity in the property, right? So even if things go south, your investors are still covered.

Jevon
Exactly. If we’re doing a deal, it’s because there’s enough equity to cover our position, even if things go wrong. We also assume that not everything will go perfectly, so we prepare for the worst and make sure our investors are still safe.

If we’re doing a deal, it’s because there’s enough equity to cover our position, even if things go wrong.

Bryce
Gotcha. Switching gears a bit—how has the industry changed since you started in 2004? Have you seen any major shifts over the years?

Jevon
Oh, a lot has changed. Back then, it was all ramping up before the 2008 crash. There was a lot of risky lending, bad debt being packaged as AAA-rated, and all that mess. After the crash, everything went quiet for a while. There was a lot of regulation added, like the NMLS (National Mortgage Licensing System), which made things harder for lenders. But now, things are cyclical. We’re nearing the end of another cycle, and honestly, it’s tough to predict what will happen next. The market’s been unpredictable lately—nothing seems to make sense anymore. In the past, you could look at economic indicators to forecast trends, but now… it’s harder to read.

Bryce
Nothing makes sense anymore, that’s for sure.

Jevon
Yeah, it’s tough. But we focus on what we can control—our deals. We know what works for us, even if the macro situation is confusing. We stick to doing solid deals for our investors and focus on finding good opportunities through our network. Right now, we’re even doing some retail centers, which is outside our usual scope, but the deals have been great for cash flow and security.

Bryce
That makes sense—stay focused on the deals that make sense for you, even if they’re outside the box.

Jevon
Exactly. Don’t try to predict everything. Control what you can, do good deals, and take care of your investors. That’s the goal.

Bryce
And speaking of investors, can you tell me about your capital stack? Where does your capital typically come from, and how do you structure your deals?

Jevon
A small percentage of our investors are new to us, coming from referrals. Over time, we’ve grown more known, and now people we’ve never met are investing. In the past, though, most of our investors were people we knew well—after years of coffee and conversation, they’d decide to invest. So, some of these newer investors are bringing in money, but it all goes into different “buckets” or funds. We have three main ones, ranging from the most conservative to the least conservative. I think they’re all pretty conservative, but our most conservative bucket focuses on Southern California real estate. It offers the lowest return—around 7%—but it’s as safe as it gets. Think of it like a savings account for grandma. We lend on high-quality, low-leverage properties with really good credit borrowers. If anything goes wrong, we’re still in a good spot.

Our next bucket is a little more flexible—our “first cash fund.” This one usually operates with up to 65% leverage. The fund average is closer to 58%, but we’ve done a few deals at 70%. It pays investors around 10% to 11% over the last three years, typically on 12-month loans.

The third fund steps in if any of the other funds have defaults. This one buys up the loans from the others and pays investors higher returns—usually 13% to 18%, depending on the quarter. If we end up taking back the property, we could see a 100% return on that quarter.

Bryce
That’s really unique—splitting it up into buckets like that. I haven’t heard of anyone doing it that way.

Jevon
Yeah, the most popular bucket right now is actually the lower-interest, super-safe one. It’s boring money, but it’s safe. It’s like a higher-yield savings account.

Bryce
Right. And you’ve got liquidity options for investors who need it sooner?

Jevon
Yes, usually a year is the minimum, but we can work out options if someone needs to access their money earlier.

Bryce
At this point in your business, do you have more capital than deals, or more deals than capital?

Jevon
We’ve got almost unlimited capital. A lot of our investors don’t want to be in the fund, but they’re open to individual deals. So, whenever we need more capital, we just reach out to them. Our fund gets tapped, but we’ve always got investors ready to jump in.

Bryce
That’s amazing!

Jevon
Exactly. If we had a problem, it would be having too many deals and not enough money sitting around. But right now, we’re always good on the capital side. So, send us deals!

Bryce
Got it! Tell me more about your loan structures. Do you have set points and interest rates, or do they vary?

Jevon
I’ve set some general guidelines, but we have the flexibility to make decisions based on each deal. We don’t need approval from anyone else, so when a deal comes in, it’s a quick decision. If we like it, we go for it. Our focus is on the property itself—how safe is it? We’re an asset-driven lender. If the property has low leverage and we’re confident it’ll make us money, we’ll move forward. We also look at the borrower’s credit and financials, but the property is our primary concern.

Bryce
So, if the property is solid, you might still move forward with a borrower who has poor credit or no income, as long as the asset is strong?

Jevon
Exactly. But I still ask those questions about credit and income because I’m trying to foresee what could happen. I don’t want to end up foreclosing. It’s expensive, and I’d rather just lend money and get paid back.

Bryce
Right, mismanagement is the biggest risk, not the deal itself.

Jevon
Yeah, mismanagement is often the reason deals go bad. But sometimes we take on deals even knowing they might be a mess—because the property is worth it.

Yeah, mismanagement is often the reason deals go bad.

Bryce
So sometimes, you’re like, “this is going to be a disaster, but it’s a good property, so let’s do it.”

Jevon
Exactly. We’re not picky, but we’re definitely focused on the property’s value.

Bryce
So, do you lend nationwide, or are there certain areas you focus on?

Jevon
We mainly focus on major metros, especially in California. We prefer suburban areas close to those metros, not rural areas. If we have to take a property back, rural areas make it tough to get comps or sell quickly. So we avoid much of the Midwest and South, though we’ve done deals in nearly every state.

Bryce
Got it. So you’re open to deals across the country, but focus on bigger markets.

Jevon
Exactly.

Bryce
I know California is notoriously difficult in a lot of ways—whether it’s the regulations, the costs, or just the complexity of doing business. When you lend outside of California, do you ever think to yourself, “This is so much easier! There’s not all these restrictions,” or do you find the California experience gives you an advantage, even with all the challenges?

Jevon
Yeah, it is nice outside California. The lack of regulations and flexibility is a breath of fresh air. But we stick to California mainly because we know it so well. We understand the market, the rules, and what to do if we have to take back a property. It’s hard here, for sure—California politics seem designed to make things difficult. But the high barrier to entry actually works in our favor. The real estate prices are high, so it takes a lot of cash to enter, but it’s worth it. We’ve figured it out, and I know that even in the worst-case scenario, we’re still going to be okay. So, it’s a great model. But yeah, it’s definitely easier in places outside of California. Still, we like the properties here the best.

Bryce
Very interesting. I love it.

Jevon
Yeah, and the thing is, we can sell the properties we lend on super quickly if we ever have to take them back. So, as tough as it is, it’s also very profitable. It’s hard, no doubt—litigious, high price points—but if you know what you’re doing, the rewards are huge.

Bryce
Absolutely. Still a very solid business model. I love it. Okay, last question: If you could go back in time and start over with everything you know now, what advice would you give to yourself—or to someone like me, who’s only been in the business a year or two?

Jevon
Be a financial advisor.

Bryce
Why do you say that?

Jevon
Kind of joking, but a friend of mine started as a financial advisor when I was starting in lending. Now he’s managing a giant pool of funds, living a dream life—he’s fit, makes a ton of money, and takes the afternoons off. Meanwhile, I’m grinding every day. But seriously, if I could go back, I’d focus on one thing. I spent a lot of time stressing about being in the “right place” or wishing I was somewhere else.

The real advice I’d give is to surrender to where you are right now. Wherever you’re at, that’s where you are. Stressing about being somewhere else only holds you back. Stress is when you’re trying to do the impossible. Multitasking? That’s just switching tasks poorly. If you focus on one thing, that’s when you get the best results.

…surrender to where you are right now. Wherever you’re at, that’s where you are. Stressing about being somewhere else only holds you back.

The truth is, you can only do one thing at a time. And if you can learn to surrender to that moment and be fully present, that’s where real creativity and value emerge. I think a lot of times, we miss the value in where we are because we’re constantly thinking about where we want to be. You have to accept where you’re at to move forward.

Bryce
That’s so good. Honestly, that’s just wisdom for anything in life, not just lending.

And there’s a quote I heard once that said, “You’ve already achieved goals that you said would make you happy.” It hit me hard. We’re all on this treadmill, chasing more, thinking happiness is out there somewhere. But the truth is, happiness isn’t in the future—it’s in the present. If you’re always chasing “out there,” you’ll miss what’s right in front of you. So, those are great words of wisdom. Nicely done, Jevon. You just dropped a truth bomb on us.

Jevon
Haha, glad it resonated. You’re right—people get so wrapped up in chasing the next thing, but happiness starts right now.

Bryce
Alright, well, Jevon, seriously, thank you so much. This has been amazing. I love learning from other lenders, and I got way more than I expected from this conversation. I really appreciate it. Before we wrap up, can you share your contact info—website, email, phone number.

Jevon
You can visit our website at Jcap.net. My email is [email protected]. My cell is (949) 463-9898, but just a heads up—you’ll probably get a text telling you to email me because I don’t answer my phone. But if I do have the time, I love talking about life, fulfillment, and how to really find success.

Every now and then, people get stuck in these boring rate-and-term talks, but I’m like, “Nope. You need to rethink how you’re doing this.”

Bryce
Haha, right—just email Jevon. If you call him, you’ll get a sermon.

Jevon
Exactly! It’s for your own good.

Bryce
Haha, I love it. Alright Jevon, you’ve got some great insights there. Thank you so much for sticking with us and thank you again for your time. It’s been a pleasure.

 

Contact Jevon!
Jcap.net
[email protected]
(949) 463-9898

 

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