All, I consider myself a beginner in real estate investing, but savvy in business/finance.

Quote from @Robert Bell: As a private lender, we use reserve funds as a way to gage whether or not someone is financially ready to take on a real estate investment. 

Are you trying to get into a different investment?

The area of which I am green in is real estate investing.

Short answer is as little as possible.The long answer is it depends on the deal.Typically you end up in a subject 2 situation when the current owner has little or no equity in the property, the current advantage of subject 2 properties is that most mortgages are below current market rates.Keep in mind when acquiring a property subject 2, in most instances you are not notifying the current lender of the change in ownership, and most if not all mortgages have a due on sale clause, which is the lender's decision if they want to enforce it or not.I personally like the idea its a great way to get investment properties with low rate loans, that with most likely appreciate in the coming years.

Or would I have to buy it as an investment property with 20-25% down? 

Investment Info:Single-family residence buy & hold investment.

Would appreciate any input on where to invest - Henderson, NV or Phoenix/Tuscon, AZ? 

This type of investing is often very local. 

This could include rental properties, REITs, or your primary residence.Fixed Income: 15-25%This includes bonds, CDs, and other low-risk investments.