Homes are cheap, mortgage rates are low -- and financing is impossible. Grrrrrr.

If you look in some parts of the country, opportunity is knocking with a vengeance. Homes are being sold by banks, at auctions or by desperate folks trying to avoid foreclosure. Home prices have plunged in the last couple of years, and you may be able to nab even bigger discounts by taking advantage of distress sales. Unless you can't.

The county will not finance your real estate purchase.

Yes, there may be deals galore at the county tax sale or the sheriff's foreclosure auctions. But there is no "owner financing" and your average mortgage lender wants to appraise and approve the property before financing it. And the lender wants a real estate contract, a sales price, all the usual stuff -- stuff that you can't provide when buying at auction.

Lenders with property for sale will not overlook your crummy credit. Or unverifiable income.

These days, many great deals may be found on lenders' books. And you can get "normal" financing, too, because you go through a traditional escrow and get time for a traditional mortgage lender to approve your application and fund your mortgage. But your credit has to pass muster because mortgage underwriting guidelines have become tougher, while borrowers' credit ratings have gone down.

In fact, a recent survey found that one-third of mortgage applicants (keep in mind that these were people who thought they could qualify for a mortgage) had credit scores that kept them from receiving a single mortgage offer. Finally, many of the folks with the best profiles (the highest credit scores, the healthiest assets, and he biggest down payments) cannot get a mortgage today because they cannot prove their income. Boo hoo if that's you.

Hard money or private lenders serve a growing niche.

Enter the private lender, AKA hard money lender. These folks don't ask if you live plan to in the home. They don't mind if you flip it. They don't care that you sold your Grandma for beer money and are on a first-name basis with the local repo man. And you can buy your property at auction or from a lender.

Hard money is very expensive.

Hard money lenders charge mortgage rates that are five or six percent higher than those of regular lenders. But that's just the beginning. Expect to pay a half dozen points up front for the privilege of paying that high interest rate. This is because many hard money customers only keep those loans a short time while they fix and flip that screaming deal they found. So the lender gets paid upfront too.

Hard money is hard.

Don't try to buy a house if you can't even pay your rent. Hard money is only for those who have an income sufficient to make a big fat mortgage payment. And hard money folks don't do 96.5-percent loans like FHA does. Expect to put 25 to 50 percent down on your next house.

Who should think about hard money loans?

If you find a home that's under-priced by 30 percent, that may take the sting off an 11-percent mortgage rate. Especially if you can refinance it fairly soon. So if the deal is good enough, your resources are good enough, and your eyes are open enough, go ahead and contact a hard money lender through the American Association of Private Lenders, which is an industry group with a code of ethics and an education arm.

If this profile does not fit you, try filling out the form on this site for more realistic mortgage offers.