When unable to secure traditional home financing, explore alternative lenders such as private lenders, community development corporations, or family members offering loans or gift funds. Prioritize improving your credit score through paying bills on time, reducing credit utilization, and disputing inaccuracies to qualify for better terms. Consider government-backed programs like FHA loans (requiring a 580+ FICO score) or VA loans (no down payment for veterans) that offer relaxed criteria. Negotiate with sellers for a portion of the purchase price or accept a co-signer with strong credit.

Government programs and alternative lenders provide accessible options when conventional financing fails. For instance, FHA loans permit down payments as low as 3.5% for borrowers with scores above 580, catering to 21% of first-time buyers in 2023 (U.S. Department of Housing and Urban Development). Meanwhile, 10% of homebuyers utilized non-bank lenders in 2022, up from 6% in 2019 (Federal Housing Finance Agency), reflecting rising demand. Improving a credit score from 500 to 620 can reduce mortgage rates by 1.5%, saving $50 monthly on a $300,000 loan (myFICO, 2023). Co-signers boost approval chances by 40% among applicants with subprime scores (Consumer Financial Protection Bureau, 2022). These strategies collectively address affordability, risk, and eligibility gaps in the housing market.