#1
So im in a local band and we wanna record some of our original tracks. We did it at a friend's house before ($200 for the day) and it wasn't great quality. I was thinking of setting up my own little recording studio in the basement since I know how to edit audio and stuff.

Nothing fancy, just like 3 microphones straight into a computer and use some kind of music software (probably ableton since i have it).

My quesiton is: which mics should I buy in order to do this? Plus, should I buy a small mixing board and use pro tools instead? If so, what board should I get?

Keep in mind, we don't have a ton of money to buy high grade stuff, and don't count the prices of software since I already have them.
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#3
I use an M-Audio Nova for vocals and acoustic guitar. It's about $120. Shure SM-58's are considered the industry standard for vocals. Personally, I prefer the Nova though. For miking amps, the Shure SM-57 is considered standard.

My personal set-up:
M-Audio Nova for vocals and acoustic
SM-57 for miking amps
Both of those go into an MBox 2, as well as tracks that are DI
I'm running Pro Tools 8 as a DAW

There are tons of good, cheap mics, and they all have slightly different frequency responses. Get some more answers hear, do some more online research, and head to a music store to ask some of the employees. Test some out if you can, rent some, find the ones that are best suited for you.

Good luck!
#4
Get a few Shure SM58s and probably a 57 if ya want to mic amps...but the two mics are just about the same thing. You may also be interested in the Sennheiser E609 for amps as well.

As for a mixer, stay away and just get an audio interface like the M-Audio Fast Track Pro which has 2 mic/instrument inputs on it.

Fast Track Pro - $200
SM57/SM58 - $100 each

Track two mics at a time and then play back and record any remaining parts.
For drums you're going to have a hard time getting a great mix as you don't have a mic on each drum and such...but you can get a fair mix with some time and mic position...