If your credit is bad howelse can you buy a house

With a VERY large deposit.

You can try something like this How to Buy a House With Bad Credit & No Money Down | eHow.com but it is rare. Notice the first step is to raise your score to above 600.

You need to start working on your credit as soon as possible, after you get an average one you and you have saved a nice lump of money, you can then start thinking about buying a house. If you try to find something too soon then interest rate is going to be insane, and going through foreclosure because you bought something that you couldn't afford with that high interest rate will only set you back several years.