How to Finance a Small (40K) Home Purchase?

[Amber Douglas]

Hello There!  

I have found an 1100 Sq Ft home (2 bed 1 bath). The roof was replaced this year and the Central Heat and Air unit was replaced within the last 3 years.  The house is on a large lot and needs some updating... Most of which I can probably manage myself.  The house also has a small garage + an attached carport.  I think I could convert the small garage into liveable space.  This would add approx 200sq feet to the liveable area.  

I am currently listening to Investing in Real Estate with Little or No Money Down... But, I am not experienced enough to figure out how to manage something like this?  Approach local lenders for a what exactly?  How much do I finance?  Do I need to get an appraisal and an inspection?  Seems like an obvious yes... But, I am not positive.  The house is currently occupied... So it is liveable. 

Houses rent faster than you can post them in this area.. But!  I am not sure how to make the initial purchase...If I use a private loan?  Do I renovate and refinance into a conventional loan?  If so... For the full appraised value or just enough to pay back the small note+renovation costs?  

I am currently living in a rental as well.  Do I purchase the (40K) house and stay in my current rental while I renovate the other then just rent the other out?  Then refinance the home and use the equity as a down payment on a new property?  Renovate the new house.. Treat it like a first home loan... Live in it for a year.. Then rent it out?  🤔🤔

Any advice would be appreciated!!