What would be my best bet as to start up money or money up front ?

Some investors use it to filter prospects, some private lenders use it as a threshold for their terms, etc but other than that, it's just an indicator.When I analyse a project, I always work backward from the minimum profit I want to make....next is ARV.....from there, I calculate all other expenses (including closing costs on the purchase and sale) and work down to the bottom line.I use a private lender that doesn't know or care about the 70% rule so I don't use the rule.

Im looking to start investing in real estate and I thinking maybe using a hard or private money lender to start out with.

While your imediate area may be tought to cash flow, I bet within an hours drive there are neighbrhoods that will make great rentals.

Your best bet will be smaller local banks.

As to pre-payment penalties, you need to check state laws concerning residential or private financing transactions.

What would be my best bet.

Are you concerned with paying your Realtor when doing a deal with a private seller?

Unless you have a good history with one already they want the purchase agreement as a prerequisite to getting the loan.If you have a private lender ready to put up monies for a deal they generally don't require that you have a deal under contract immediately.3.

You can raise private money to cover all of the cash needs of a deal, so as long as you know how to manage contractors to produce results, and manage a management company over time to keep the property full, there is no reason not to go directly into multi-family.