RE Newbie, what financing should I use at my age?

[Payten Mox]

Hello all!

    I am a twenty year old looking to get into real estate. I've been doing major research along with looking through BiggerPocket's videos and forums. I'll give you guys a quick rundown on my situation. Feedback on how I should go about starting or any general advice is encouraged!

I am in the South Bend, IN 46616 area and parts of the neighborhood are up and coming. Houses are flying up for sale all over because of the foreclosure rate! Now I am only making 15/hr @ 40 hours a week, and I plan on going back to school to get a better job to help build my portfolio. I want to either house hack, or do a fix and flip just to get extra money coming in. I know it is extremely difficult to get lending for someone who has no experience but I am determined to find a way. I am going to have to work a few months to gather any funds for an FHA. My only financial responsibilities are a financed car(huge mistake), car insurance your usual basic essentials. Right now I am living rent free but in the future I'll have to pay at least 200/month. A few months I will be refinancing my car to get a lower payment. Other than that, I would have 6 months of saving 800+ dollars. How would you recommend I get started with my first "fix and flip" or if I can even do a fix and flip. My credit is in the 650 range on CK but my FICO8 is 720. Really, what are my options?

[Zach Gard]

Hi Payten! Welcome to the SB investor community. My response will likely be a little controversial based on what level of risk others are willing to take on but thought I would offer some insight regardless. If I were in your position, I would work like crazy including any OT and side jobs you can pick up to build your nest egg first. You have an advantage over a lot of other folks right now in that you are living for free which gives you a golden opportunity to be able to pay off your car as quickly as possible and boost your savings account. Once you have a healthy amount for a down payment, then you can engage financing companies who will, at that point, look at your strong personal financial position where you have no debt and money in the bank, and they will be happy to approve you. At that point, look for a house hack that needs normal cosmetic repairs (flooring/paint/patching drywall/etc) but DO NOT take on a full gut job where it needs everything (roof/structure repairs/outdated electrical/ancient furnace/etc). Once you locate the property, reach out to your buddies and have them agree they will live in that location with you and pull the trigger. Good luck!