Staying active on these forums and listening to podcasts can help you as well :)

My income is not very high, so debt-to-income assessments won't get me the financing I need.I need $450-500k for construction. 

I don't want to build a team of investors yet but just myself and friend of mine decide to be active investors is there a need to have an attorney close the deal?

Calculate your bottom line using 70% of ARV (After Repair Value).Do not spend more than (.7*ARV)-RC (Repair Costs)Example: House is appraised at $100,000 *if repairs are made*...7*100k = 70k.Repair costs are expected to be $25k. 70k-25k = $45,000 (DO NOT BUY THE HOUSE IF IT IS OVER $45k)Take another look at the ‘going rate’ of rent in your area, make sure your cash flow is enough to cover ALL costs and include a buffer for taxes and unexpected repairs.Look at the property yourself - try to eliminate assumptions.Have a trusted professional assess and confirm info about repairs that may have been overlooked.Look at how much work you can do on your own and compare it with contractor rates to complete all repairs.

Not sure of condition or current tenants, but is it crazy to actively pursue this one for a first property?  

*Note: this post is intended for investors who actively DO NOT automatically file a 1040 every year, unless they've incurred a tax liability.I'm wondering what difficulties investors who understand (have read the pertinent details of the tax code) have faced when engaging in investment opportunities that normally require an investor to furnish tax returns, and what solutions have they come up with.From my experience in banking, I understand that institutional lenders normally require a borrower to furnish yearly personal financial statements and tax returns.

After looking at several dozen single family properties (more or less with no rehab necessary) ranging from $130-$175K, I’m seriously beginning to question how you make money with a long term hold single family rental given the tax rates in desirable school districts and the lack of any exemptions on assessed value for owners not occupying the property.

I would start there or check loopnet and see which brokers are really active, especially in the 20 unit range you're in and call them for a referral.

Is it for a down payment or to facilitate other investing activities?

I am actively looking and in contact with a couple different sellers.