Then go through the numbers and see if there is enough potential profit for you to be comfortable with the deal. 

I’m personally more comfortable with SFR or a 4 plex vs a 50+ multi family. 

Hi Alex,It could depend on your experience - if you have a lot of experience in heavy rehab/construction you will (1) be qualified for the loan as construction loans require substantial experience and (2) feel more comfortable taking on the loan.

Real estate can be an excellent investment, but ensuring you can comfortably manage the payments is vital, even if you encounter negative cash flow periods.

It really comes down to what specific documents you need from the tenant that you'll feel secured and comfortable of renting it to him/her.The typical criteria would be credit, background check, renters insurance, first + last month of rent + security deposit.

Start small with a manageable "house­ hacking" property fitting your financial goals and risk comfort level.

Here in Chicago the most I’d be comfortable with holding is a trash out fee if they left trash in the yard.

I think a short-term fix-and-flip loan would serve you better because, first, the credit requirements are typically lower than a DSCR loan's credit requirements, and fix-and-flip loans will fund a portion of the purchase price as well as some or all of the rehab costs (usually through the draw process).Right now, saving your cash, rebuilding your credit, and finding both a partner (ideally with a higher credit score AND experience) and lender you're comfortable with should be your priorities.

Faster evictions, relaxed rent control, and a short-term rental friendly environment all contribute to potentially higher cash flow.

It seems like you would want your property be close to amenities since it seems like you would trade the comfort of having your own space to being in a better area for a cheaper price but I could be wrong.