The owner can "carry a second" note and deed of trust (mortgage) for part or all of the downpayment and a mortgage company will loan the rest; the owner's second helps you qualify for a "nonconforming" loan from a mortgage company. The worse the credit of the buyer, the higher the actual down payment at the closing table will have to be, but with a sufficient "seller carryback" and downpayment combined almost anyone can get a loan.
The owner can finance with a deferred downpayment (usually in the form of an addition to the monthly payment). That is, the owner can carry both a first and second mortgage, usually with a very short term on the second.
An owner can also sell the home to you on a lease/purchase or lease/option. In some cases, part of the rent may apply to your purchase price when you "exercise the option" to purchase the home. This defers the seller's closing costs and yours until the expiration of the contract, typically one year. Some lenders will treat the lease/purchase as a refinance, making it much easier to qualify for 100% (or higher) loan-to-value financing. There is an excellent site available dealing with lease/purchase transactions. Rather than duplicate their excellent work, I highly recommend paying a visit to them -- just remember to bookmark this site before you leave! -- Lease2Purchase.com is a creative real estate resource center that specializes in the lease purchase / lease option contract. Click here to learn more!
Ask your real estate agent about available properties where the owner is willing to carry a second or sell on a lease/purchase arrangement.
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