Borrowed a beatup pickup from a relative (after they repod mine, that was a fun day) and started working for a rehabber for peanuts.

He explained to me that fundamentals have been outta wack in this business since the early 90's when easy borrowing and easy money began to get out of hand.

The difference is some people feed off that disappointment and start figuring out ways to overcome the obstacles, while others use the obstacles as a reason to stop striving.

Until you have 2 years rental experience that you have paid your taxes on banks will not count the rental income towards your gross for calculating how much you can afford to borrow.

@fredramos is dead on -local community banks will be way to go for this type of financing if you wish to borrow in LLC name.

I will get into investing later as I was doing that in Austin 7 years ago before I had to move here in Socal, but right now I'm trying to stop paying $24K a year in rent when I could be in a home that's mine.

The near miss borrower, the one that almost qualifies for established loan "programs" is usually treated as badly as the borrower who has no intention of repayment.

Chances are you will - have a deficiency judgement, - if there is a second mortgage you will owe that money, - the IRS views the debt as forgiven income (see a CPA), http://www.irs.gov/Individuals/The-Mortgage-Forgiveness-Debt-Relief-Act-and-Debt-Cancellation-- your credit FICO score will drop as much as a foreclosure,and - your borrow-ability with any government agency like FHA will be harmed for a long time.So what is left?

I'm glad you stopped lurking and joined us.

A no money buy and rehab project with all borrowed funds is an advanced maneuver.It's okay to walk before you run.