Careful... and get it all in writing (drawn up by an attorney).
What you're talking about doing is also referred to as a Subject-To deal (you're taking over the payments "subject-to" the original loan).
Here are some links which may provide you some assistance on learning about this advanced technique of acquiring properties:
Another technique you can use (and it's less complicated) is to do a Lease Purchase on the property. If the seller is behind on the payments, you can set up an 3rd party escrow account, make up the back payments, then just lease the property for whatever amount of time you need to get your finances in order, then exercise your option and purchase the property at a later date. By creating the escrow account, your lease payments have a nice paper trail straight to the mortgage lender of the original seller. This eliminates the possibility of the seller just pocketing your monthly lease payments and not keeping the loan current. Everyone knows where the money is flowing.
A lease option is also looked at more positively by a lender when you go to get your own financing. You can even receive rent credits from your lease payments which can be used as a seller concession (3%) and also can lower the originally agreed to purchase price. You can also agree to a LONGGGGG term lease like 5-10 years if you want because YOU, and you alone, have bought the right to purchase the property at a later date. (you can even have the option recorded at the courthouse as to "cloud" the title should the original seller try to sell it out from underneath you.)
You get to live in the house right away with time to work on your credit...the seller doesn't have to take the major hit on their credit because "you've" been making on time lease payments to them which directly pay the mortgage. It's the best of both worlds.
Hope this helps you out a bit.
Best wishes & Laus Deo,
Best of luck buying a home.
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Although title could transfer into your name, the loan would still remain in Mr. Smith's name & you would be making the payments. Normally an account would be set up so Mr. Smith is actually still making the payments even though now, the actual funds are coming from you.
Then, when you are able to get a loan in your name, you refinance it out of Mr. Smith's name & solely into your own.
I urge you to contact me or a Realtor in the area to check on the current value, if this house is nearing 0% equity, I strongly advise you against doing an AITD, because when you go to refinance it into your own name you may not be able to because there's no equity & Mr. Smith is still on the hook to pay off the loan or do a short sale & you'll be moving out.