Thinking of buying first home, but I have bad credit and no down payment?

I keep going back and forth: - I could wait a year and improve my credit and save for a down payment. I would continue paying more in rent than I would in mortgage and insurance, but I would have more money in savings and better credit, therefore a lower interest rate, -Or I can get something now at a... show more I keep going back and forth:

- I could wait a year and improve my credit and save for a down payment. I would continue paying more in rent than I would in mortgage and insurance, but I would have more money in savings and better credit, therefore a lower interest rate,

-Or I can get something now at a higher rate of interest, and pay less than I do now in rent, and split the savings into paying down the principle and paying off bills.

What do you think?
Update: This houses I am considering are about $35,000 - about what I make a year in salary. With no down payment and 8% interest, my payments would be about $350 for mortgage and insurance - $200 less a month than my current rent.
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