20 yr old with subprime credit but a lot of cash wanting advice.

[Travis Bill]

Hello all, I joined this site early this year wanting to buy a duplex and live in it and rent the other unit. I was going to school at the time. I decided after lurking this site for quite a while that I wanted to make my "career" in real estate. I knew id need cash, and a lot of it. I dropped out, moved a 1000 miles, and headed out into the oil patch. Good fortune would have it that I would be hired by a great company for a position I was not qualified for, then after an injury to a co-worker I was promoted into a even higher paying position.

Its been 3 months and iv saved 10k already. With my new pay rate I will be able to save, on average, 5k per month after all my expenses. I figure its time to start thinking about the direction I want to head with my money, and this would be the best place for some advice.

What is the best way to start? Single family? Du-plex, tri? small multi? Complex? I feel I want to start big. I should have around 40k by spring, and i think that should be enough for a DP on a decent sized building. (Id ideally be looking in the Twin Cities area, its kind of near my home, and after some research, seems to be a quality area)

That bring me to my next question. What is a realistic LTV for someone with subprime credit? I think im gonna leverage as much as I can, after all going from 80% LTV to 90% is doubling your purchasing power, but im not sure if its realistic for my situation. Maybe it would be plausible if I went the hard money-balloon loan route?

Iv read that commercial loans are not personally guaranteed. Is it possible to personally guarantee the loan to be more likely to get it?

Also if you feel you have anything else to add, go for it.

Thanks.

[Steve L.]

Travis -

Can you fix your "sub-prime" credit by spring? That would be the first thing I would work on. If you can get your score to 720 it will make your life a lot easier.

How long are you willing to work on the oil patch for?

Fix credit, save a lot of money, start picking areas and making lower offers. I wouldn't rush to get in the game, I would make sure you really understand the area and really get a good deal. But once you have good credit and enough cash, I would attack it hard.