You probably want to focus on finding a lease purchase financing option. In the current market, many sellers will consider a lease purchase -- even if they are not advertising that way. Your Realtor can help you find properties that fit your needs that area also offering special financing ( including lease purchase). If you don't have a Realtor, we'd be happy to help you.
Matt is accurate speaking about Lease/ Purchase as an option. Again, how much money do you have to put down and have you had a home foreclosed upon or included in the Chapter 7. Even home owners offereing a lease to purchase want assurance the tenant can make the payment. Bad credit usually requires a larger downpayment than those with great credit.
I recommend hiring a great agent and working with a great lender... and then keeping your credit clean to rebuild the credit score.
There are a bunch of other ways to buy a property without getting a new mortgage. Some wouldn't be right for you, but some might be. You might want to research (Google) "subject to," "contract for deed," "equity sharing," and "owner financing" to start. Post here if you want further details on any of those.
You definitely can do it. Good luck.
The short answer is, that YES you could potentially purchase a home. There are other factors that go into the loan. The question could come that although you can get financing ... do you really want it?
You might be better off going owner financing or lease purchase as Matt suggested.
You got some great responses fromt the other agents, but I want to suggest one more thing that I think you should try. There is a program called NACA, This program helps all kinds of people regardless of your credit score. It is pretty much mortgage counseling, you have to sign up for a four hour workshop, then they match you up with a counselor, this is character based lending and they take a look at the last two years to figure out where things went wrong or maybe didn't go wrong, but they get you on the right track, and they underwrite the loan for you. It may take 2 months to get a loan or it could take 6 months just depending on you.
I learned about the program through a client of mine that had entered the program a year ago, but just didn't find a house she liked at the time so she just decided to wait and some friends put us together and she invited me to a meeting. I think It is a great program.
Go to the website so you can read up on it some more.
if you decide you want to go through the program let me know and I will go ahead and register you so you can get started and then if you need help finding an agent in your area let me know or you can always come back to Trulia and find an agent or go through the NACA program.
Let me know what you think