There are many, many ways to "buy" a house. It is true that closing costs, possible down payment, and some other fees add up to lots more than $500. HOWEVER- it is also possible that you can negotiate terms of the sale where the seller may be willing to pay some or all of these costs for you, as long as it is legal, above board (all parties to the transaction are knowledgable of the terms) and as long as the new mortgage company for the byer (if there is one) accepts the terms as within their own lending guideines.
So- yes- it is possible. But you should be careful. I am not an attorney- but you should consult with one if you have any doubt about what you are committing to by entering in to a real estate contract.
Just know that there are dozens of methods of buying real estate. In negotiating, you never get what you deserve. You get what you negotiate.