Unfortunately some finance options will not be available if peeling paint is evident. I believe it varies by state but FHA, First time home buyer programs, VA, and other loan programs require a special appraisal that will reveal peeling paint among other things to the underwriter of the loan.
I have had many situations where peeling paint has been an issue, hopefully you can find someone who is going conventional or cash. Otherwise you might want to consider a good paint job. Im sure for the cost your curb appeal will be improved significantly!