I am not just blowing off your question, as a "good" lender will take the time to review all your information, credit scores, FICO, debt-to-income ratios, and etc. So that will allow you to see where you are and they can make recommendations of what to do to repair and increase your scores so that in the future you will be approved for a loan that will allow for home ownership. I of course donâ€™t know the market where you are, but here in Tucson, AZ Lease tends to favor the seller, not you. Talk with the lender about it, but I would shut down all "unnecessary" expenses, live a "Spartan" lifestyle and simple save. That might mean moving into a minimum sized studio or small apartment for a year, but if it helps you get to your goal, it will be worth the sacrifice(s).
Best of luck.
Just remember that if you buy a rent to own home that an Owner can still foreclose on you if you do not make your payments.
One of the first things you need to do in order to up your credit score is get a copy of all three credit scores. Take a look on the credit reports to make sure that there are no duplicates on there. Duplicates may not always be exact in dollar amount so look at company names and dates. You probably know what it is you spent at some point or where you messed something up and need to fix it. If it is a duplicate then you need to get the credit company to delete that duplicate. Start off by contacting the company that has it on there twice. (The phone numbers of the companies affecting your credit scores are at the end of the credit score documents.) Start with a phone call. If that doesn't work, then write a letter requesting that they remove the inaccurate amount from your credit score. Keep a copy of the letter that you send to them and send it via registered mail which will get their attention and get them to take care of it right away. They have 30 days to fix it on your credit.
Some people say to send it via regular mail and right at Christmastime because they are not paying attention as much and then it gets past the 30 days and they have to remove it anyway, but why be sneaky? It will always come back to bite you if honesty is not your best policy.
Be aware that some companies have sold their collections to other companies and have it on there accurately for their company but this can still be fixed if it is a duplicate so just request it be removed. You may have to work directly with the credit reporting agency to get it removed in that case. Honestly, the last time I helped a friend with hers, it took three months for her to fix her credit score but it came up significantly.
Some of the other steps you can take are to be aware of when your credit is being pulled by the mortgage company. If you have a $300 limit credit card and you just put $175 of purchases on it, DO NOT HAVE YOUR CREDIT PULLED YET. You want to have your credit pulled about a week after you have paid all of your credit cards off and they all need to be below 50% of your credit limit. This will significantly raise your score.
Another no no: Do not close out credit cards. A closed credit card looks negative on your credit score. It does not show why you closed it, just that it was closed. It will look like the company closed it, not you and thus is a hit to your credit score. A credit card with nothing being spent on it is a plus when it comes to credit.
Be aware in getting a mortgage that the mortgage company will pull your score twice at least. Once at the beginning of the process and once right before closing. From the time you have your credit pulled that first time until you actually close that loan, DO NOT put anything else on your credit card. One month without a credit card will not kill you. I know...I have done it and it is not easy, but I am still alive! :)
So, those are my hints and tips. Good luck with getting your credit score raised.