Case Study for Houshacking in Minneapolis, Minnesota:Bought a duplex for 3.5% down on an FHA mortgage: $6370Rehab said duplex: roughly $10,000.

@Ray Harrell you need to study the law.

Directly from Allregs  Fannie Mae's guides:Limits on the Number of Financed PropertiesIf the mortgage loan being delivered to Fannie Mae is secured by the borrower’s principal residence, there are no limitations on the number of other properties that the borrower will have financed.

They include (but not limited to) any loan mortgage payments, taxes, insurance, utilities, HOA fees, etc that occurs during the Rehab period and up until the property is fully rented.  

But also consider the legal limitations/costs in each market. 

first you have to decide what you want to do in the note business.. what most of the responses are talking about is buying bad debt.. and 2nds at that which this is the most risky and the most work..if your looking for work and risk and job then that kind of note investing is for you.If your looking for Passive income with no work and Limited risk then you simply need to align with a great HML who takes on private clients or those that understand where performing notes are generated.. we have done over 1700 performing notes for clients that last 5 years and really don't advertise at all. simply because once you get conservative investors in your program it just feeds itself.. deal flow is the key right now.. most have a hard time finding quality. finding defaulted seconds is easy.. and the most risky. 

I want to avoid personal guarantees and limit my cash outlay as MUCH as possible.

Maybe there is a time limit for minimum time living there that I don't know about, but I think you are fine.

Not to mention (and YES< I'm pulling this card), that I have a very limited budget, have 2 young kids, and am 7 months pregnant dealing with this issue from the east coast while my husband works full time, me part time, while taking care of our children on a tight budget.  

I grew up in the Bellevue area and if you are willing to live right outside the city limits, there are other areas that can work well for both rental homes and or a primary residence.