Should I even TRY to start now?

[Robert Granger]

Hi everybody, I would like to first say that I have been reading BP forums for a while now and they have helped inspire me to invest in RE. I'm 28, engaged, have a 2yr old son, and at a somewhat difficult point of life right now and would appreciate any advice.

Here's the breakdown, I have about 40k in debt (car loans) that I pay about $600/mo for, I pay $1200 rent, paying $600/mo for daycare, and I make roughly 75k/yr. I am a vet, but in my not-so-bright youth I didn't save a lot of money so when I got out of the Navy I had about 20k but I used that up to hold me over until I found my current job. My fiancee is in school until December (she didn't like riding the bus, hence the 2nd car loan), and I expect her to make roughly 20-40k her first year out and pay about 5k toward her student loans. With all of my other living expenses I can save maybe 200-300/mo. So now I have a good job but no money saved, I don't even have enough $$ for a home inspection/appraisal/closing costs, my credit took a hit with the financing of my 2 cars(was high 600's, now right around 600), and I want to begin investing in RE. My significant other is totally on-board to invest, but how do I begin?

As I see it, here are my options:
1) Buy a 3-4 unit multi now using 0% VA financing and move into one unit. Use rent received to pay mortgage and cash flow ~$200/mo(using 50% rule). Put cash into savings along with $1200 I WAS paying for rent +200 I can save and by the time the fiancee graduates I will have ~9600 over 6 mos. Income from fiancee can be added after that point, assuming bottom line of 20k/yr, in 1 year(-5k for loans) I will save ~24k and then use traditional financing for future investments not using more than 50% of $$ saved to ensure there is a cushion for my first property.

2) Wait it out for 6 mos and build up some capital(200/mo*6=1200 saved, not much), then follow plan 1, bank around 24k after 1.5 years.

3) Wait even longer , say 1 yr, and start out with ~12k saved, hopefully better credit and qualify for better loan terms.

Those are my 3 choices right now, I want to start ASAP while the market is down and money is cheap, long term I would like to buy more multi's, maybe a few SFR's and do a few fix-and-flips in between to build up enough to supplement my W2 job with rental income and retire early.

So the question is: Should I start now? CAN I start now without having cash for closing or initial costs? Anybody with similar stories or experience? Any and all advice, comments, critiques of my plan are welcome. Thank you!