My First Deal...Am I Ready?

[Brandon Hall]

So I posted a while back about a house I was looking at and didn't get any responses. I have since then went and inspected the house with the contractor and I have details. The house is listed for 65k, but I would try to get it for 50k. This puts me borrowing 40k from the bank. We estimated that it needs about 10k in repairs so that's 20k on my end. We have that much equity in our current house to use. It's listed as a 3/1, but after seeing the property, it's really a 4/1. In my area a 3 bedroom rents for around $900/month and a 4/2 would rent for $1200/month. Given that it only has one bathroom, it may bring in a little less. Either way after the 50% rule I am still cash flowing more than $100/month.

My big question is am I ready? My wife and I are eager to get started but we don't have a big cash reserve. We have the equity in our house and a couple thousand in savings as we have been putting a lot towards paying off our debt. This is an older house and although the initial rehab isn't that much, I would hate for something like the septic to go wrong early on. On the flipside, this house is a lot cheaper than other houses like it in my area. I'm not saying the ARV would be 180k, but I know it would be closer to 100k. I don't want to miss a good deal. Any advise is appreciated. If I left out any important info just let me know and I can get it to you.