Advice on Financing Options for SFR

[Tripp Warren]

Hi All, 

I posted this on the facebook groups, but I wanted to get some advice from some of you that don't frequent social media that much. 

I'm looking at a 3/2 SFH listed at 125K (probably could get for 100K) that needs about 8k rehab. I'm considering two options;

1) FHA loan and do the rehab then rent after a year. I can rent out my current home while doing this. Or

2) Conventional 25% down, hurry to rehab, then rent out.

The cash flow is much better obviously with the lower mortgage payment using Option 2. The down payment is nicer with option 1 but cashflow won't be realized until I move out and rent after year 2. Although, renting my current primary could help offset. I suppose I could cash out refi after the rehab to put into another property but I don't know that the rent could sustain the mortgage after the increase in value. 

Looking for suggestions or other options. Also, do they offer DSCR loans on SF?