Although FHA is great for many "in city" borrowers, many like myself, were approved until it came down to the appraisal process. Our "wanted" home appraised for 300,000 and we asked for 200,000 after the down payment and particulars. FHA agreed, but then denied because there are no "comps" within 1 mile of the home. We live in a small, rural area in Texas. Many homes are more than 1 mile apart, and it is nearly impossible to find one comparable to the listed home in the county let alone find three within a 1 mile radius. This stipulation is horrid in my opinion as well as in the bankers opinion. We are now having to look for another alternative. FHA appraiser said that unfortunately many homes are now turning to "owner finance" or cash because of this stipulation.

Reading this blog has given me hope...we have been working so hard on fixing our credit (my husband and I).  He is now almost at 600 (middle score).  His high score above 600.  However, I read that with FHA you can have no lates...is that correct?  Because we have a few --90 days on one credit card (due to my loss of employment). I am a bit stressed because we just found a house that we love!  But I do not know what type of financing we can get...Any advice?