In that case, the lease to own option (from a seller who is in a position to hold a note) means less money up front, The terms will be very important. Real Estate Attorney in consultation advised.
A foreclosed property is now under the direction of the lender or an agent of theirs to be sold. They often have detailed lengthy addendum to the original purchase contract stating the terms which you must agree to in order to proceed. Often includes the prop. being "as is". Meaning they will not make repairs. Closing costs are likely to be thousands of dollars which the buyer has to have in cash.
Since there is a great deal of uncertainty in the real estate market , perhaps a cautious approach of savings and building back your crredit should be the first step. Purchasing does not usually recoup the expenses and become profitable for 3 or more years. Be sure you are going to be in the area for that amount of time.
With no down payment and bad credit, things don't look great but the only way you will know for sure is by talking with a lender. Talking with a lender will not only give you an answer (if there are lending programs available they should know about them), but if the answer is no you can find out what to do in order to qualify in the future.
Best of luck to you,
Why not rent first and build your credit score?
CFS Mortgage - http://www.cfs203k.com
For FHA and VA loans. You need a min credit score of 620-640 for most lenders. If you're currently serving in the United States military or a honorably discharged veteran, surviving spouses and/or member of the Reserves or National Guard you can obtain VA Loans that requires 0 down. If you and the foreclosed property meets USDA requirements, you can apply for this 0% down loan product as well.
Please feel free to email me for more details: firstname.lastname@example.org I will be glad to help you.
I don't know of a lender around that would finance a person with poor credit and no money. I will add that some people think their credit is bad. Most foreclosed homes require 203k for repairs. Most loans require 620 score or higher. You should pull your score to be sure you really do have bad credit.
If you have no down payment and your credit is bad, you can't buy. At least not a foreclosure. If it were a property owned by an individual, you could try a lease-option. Or a subject-to. But neither will work with a foreclosure.
Basically, the bank wants to sell the property. You're not able to buy it. Look: Talk with all the lenders you want. "I have no money for a down payment and my credit is bad." Sorry, but that won't get you very far. There's no magic solution. You have to save up some money and improve your credit.