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You can still become a homeowner, but you may have to go through the back door to do so. You could buy your house through seller financing. This is rare, and the real estate stars need to align just right, but if you find yourself in a similar situation as Ward did, with crummy credit but ample money, consider trying this route, says Mike Orr, director of the Center for Real Estate Theory and Practice at the W. P. Carey School of Business at Arizona State University. Seller financing is occasionally done when the seller’s own mortgage has been paid off, or if it can be paid off using the buyer’s down payment. Instead of paying the bank a mortgage payment every month, you’re paying the seller directly, often until your credit is restored enough to where you can refinance with a traditional mortgage lender. “The big downside is that you will usually need a substantial down payment with seller financing,” Orr says. “Sellers need to see that you have some skin in the game and that you will lose it if they have to foreclose.” You could rent to own a house. Also really rare, this is likely to only work if you find a house that‘s been on the market a long time, with a homeowner who is desperate to sell. If you’re desperate to buy, then you two may be a good match. Renting to own a house is when – with the blessing of your bank or lender – you begin paying your seller monthly rent, with a significant portion of it going toward the eventual down payment of your home. After some time, maybe 18 to 24 months, you have the option to buy your house, with the down payment money going toward the purchase price. If at that point, you decide you don’t want the home, you can walk away – but the seller keeps the down payment money you’ve accrued the last couple years. You could have a family member with good credit cosign. But just because you can do something doesn’t mean you should. If cosigning is your only option, it may simply be a sign that you should stay put and work on managing your money better and rebuilding your credit, so you can get a mortgage. After all, if lenders don’t trust you to give you a mortgage without help from family members, maybe there’s something to that. Yes, you want the home with the white picket fence badly, but just how badly? If your stressed-out parents are later paying your mortgage because you can’t afford it, you may rue the day you asked them to help you get a house. You also want to make sure you buy a house you can afford. If you find a lender willing to front you enough money to buy a house, but the rates are high and the monthly payments are punishing, you may have won the battle but will lose the war. Getting into a house won’t mean much if you have to move out within the year.

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