PHILADELPHIA (CBS) – If you are looking to buy a home now, you have many options. But first you have to know if you can afford it.

KYW’s Michelle Durham sought some advice, particularly for those who are “credit challenged.”

Cos Manzo, vice president of mortgage services at American Heritage Credit Union in Northeast Philadelphia, agrees that today’s credit score standards are tougher.

“Six-twenty was a high credit score four to five years ago — it was a good one,” he notes. “Today, purchasers are getting penalized even if they have a 700 credit score.”

In addition to reducing credit card and other consumer debt, Manzo (at right in top photo) says buyers need to prepare for the hurdles of securing a mortgage when choosing a foreclosed home.

“It gets extremely complicated. In some cases you can’t even get access to the property. It puts the entire application process in limbo because an appraiser can’t get in. And in many cases the utilities have been turned off and the owners of these foreclosed properties are very reluctant to turn the utilities back on,” he says. “You don’t know what you are going to get when you recharge the water lines and turn the power back on,” he warns.

Manzo says his company requires owners to agree to perform specific repairs on these homes within a certain time, to preserve the property’s value.

shaw arlene side durham Part 3:  Can You Afford Your Own Home?Meanwhile, many credit-challenged people are opting for a “rent to buy,” according to Keller Williams realtor Arlene Shaw (right).

“They actually will be able to own,” she says. “They rent it for two years, they go and put a down payment. Some of that rent money can be used as down-payment monies. They go and get an appraisal and actually own that house, getting a regular mortgage within two to four years of actually starting to rent.”

Reported by Michelle Durham, KYW Newsradio 1060

Listen to the KYW Regional Affairs Council series, “Buying Your First Home”…

Part 1: The Excitement of a First-Time Home Purchase, by KYW’s Brad Segall:

Part 2: Understanding Your Credit Rating, by KYW’s Brad Segall:

Part 3: Can You Afford Your Own Home?, by KYW’s Michelle Durham:

Part 4: The Changing Real Estate Market, by KYW’s Michelle Durham:

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