My personal opinion is that if you both have a low credit score and have no money to put towards a down payment, you are not able to afford to buy a home. I think you would be much better served by taking a few years to "get your financial house in order". Meaning: pay your bills on time to bring your credit score up, don't take out any new debt, get rid of any debt you do have, and save up for the 20% down payment. That will put you in a much better position to handle home ownership, with all of the surprises and costs that go along with it. Don't underestimate the benefits of renting (flexibility, not responsible for repairs and maintenance, etc.). If you are financing 100% of a home purchase anyway, you will be putting such a large portion of the mortgage towards interest that you really aren't doing yourself any favors in terms of building equity, and you still have to shoulder all of the costs of home ownership.
I hope this helps. Good luck in whatever path you do end up taking.
