New Investor, Seeking experienced opinions

[Dylan Hall]

Hello everyone,

I'm a new investor from California, I've always been interested in real estate and dabbled with wholesaling while playing football in college, but didn't find success. As I finished up my collegiate career, I've been really trying to gain as much knowledge as possible on real estate investing, reading everything I can get my hands on. I'm at the point where I know I have to take action! I'm ready! I stumbled across BiggerPockets, and love the authentic threads and responses! So I decided to ask for some help myself.. 
I've been looking at a few properties and really feel like I found something special. It's a distressed single family home (definitely a rehab property) but after running the numbers and comps, driving by it to check out the neighborhood, and area, I know it's a smart investment.. Only problem is the capital (lol of course, right). I wanted to leverage my fathers VA loan to get this home and use their rehab loan to accommodate for the renovations, but long story short, we (he) were barley approved for the asking price of the home (500k) and any renovations we would want to do to the home would need to be within that number.. even if we got the price reduced down significantly, the house is going to need major work.. so the only way to do it is by having another source of capital. I know it would be ideal to do a DSCR loan but I don't have enough to put a 20% down payment for the loan amount of the home. I've been considering hard money loans, but this is where I need advice.. would getting a hard money loan be a smart idea if I don't plan on flipping the home? If so, how would I go about paying off the Hard money loan? I personally think this would be a great property to practice the BRRRR strategy on, but I just need advice on what's the best option for obtaining capital first for this home?
and I think it's worth noting that I don't have two years of W-2s yet, (as I was on a full ride  and never had to work during school..) my credit score is around 640, and I only have around 10k to my name saved up. Just being completely transparent..

I look forward to any insight I can get, and appreciate your time! 
Sincerely.

[Brittany Minocchi]

Hey Dylan!

I'll just be straight with you - you'll want to build your credit up a bit (aim for at least 660, but the higher, the better!) and save up more money. For a property that needs rehab, you'll start with a hard money (bridge or fix & flip) loan. That loan will cover a portion of the purchase price as well as 100% of the rehab. On a $500k purchase price, expect to need 20%+ down as a new investor. Not only are you a new investor, you're new with rehabbing properties - two things that will work against you. You'll also likely need to show reserves, covering x number of month's worth of interest payments (depends on the lender's requirements). Once the property is rehabbed and you have a tenant placed (assuming the property won't be flipped), you'd refinance out of the hard money and into a DSCR loan if you anticipate issues with your income, employment history and/or DTI. Hard money is typically a 6-12 month term, DSCR will be your 30-year product. Ideally, you'll want to have enough equity at that point to pay off your hard money loan and cover your closing costs, walking away with cash after closing (or at the very least, breaking even). I would definitely try starting at a lower price point, $500k is a biiiiig undertaking for a first-time rehabber. Best of luck!