The low credit score isn't the difficult part, it's the low loan amount. Several states were hit with a predatory lending law that restricts them from charging more than a certain percentage of the loan amount. At 20k, there won't be many companies that will want to do the work for $50. You may have to go to a finance company like American General, Wells Fargo Financial, Beneficial etc. Otherwise, buy more house (around $60,000) or improve your credit. Remember, bad credit affects your score for 12 months. After that, it's not your score that's hurting, rather lack of credit. You'll want to open new credit (secured) using companies that hold your money as security (find them at Clark Howard's website). You can also email me and I'll email you the application and instructions to start your credit again. I don't make commission on it, just want to help you. You'll need to let that credit season for 1 year before buying a home. Most FHA loans don't require payoff of collections especially on stolen identity. If you can show that the other person is making the payments on a loan, the bank won't count the debt against your income (need 12 months pay history).