It would exhaust a material portion of my own liquidity for the money down and closing/inspection costs, but I'd have a much more affordable loan than HML and this 2-stage approach seems simplest to me. 

You get long term finance and if one renter goes out you still could possibly have cash flow to pay the note.Another option is to buy a house in stage zero of a new home development where homes are just going up.

I currently am at this stage and just finished my first rental property at the end of the year.

My rule for rehabs have always been that I get quoted labor only costs and then I buy materials as needed in stages depending on the job.  

It sounds similar to what Virtual Staging Solutions has created for the staging industry...They charge per Project to 'virtually stage' a property. 

I can buy late stage FC (back into the asset with the FC done)  for 67% of AS IS value all day long on nice houses in the $250k to $1m+ range.

During your saving stage you then educate yourself on real estate, finances, state landlord laws, and investing in general.

Not sure what you mean by too early.I’d still buy pre-foreclosure if a seller contacted me; we just don’t target market for those anymore.what I mean is 99.5% of people are still in major denial.. and so trying to spend a ton of time dealing with them at the substitute trustee stage will be fruitless.people in this situation in my humble experience only get serious the day before they lose it or 2 days before.we never even contacted them until 5 days before auction.. and the reason we KILLED it is we had little competition.. most need loans to buy we did not.. most rely on attorney or title company for the transfer we did not we did it ourself..

Some I love working with and have their stuff together and only sell property with sellers who are fair and equitable in negotiations and working to close a deal.As others have mentioned I try to get upfront financials in LOI stage that has a CA component.

If you are remodeling it first they will probably have to insure it in stages (Builders Risk & Liability policy, Vacant building, Homeowners/Dwelling Fire) .