Our home has sold and we close Tuesday. I'm done freaking out about whether we made the right choice or not. 
We move to an apartment tomorrow and have a 6 month lease. In that time we are hoping to build in new subdivision near our current home. Builder is Pulte and we plan to finance through them as they have closing incentives (about 9000) to do so. Based on info below; will we be able to do this? We know we will be FHA due to 3.5-5% down and current credit scores.
New Build Price: 199,000, but we think we will be at about 220,000-230,000 once we put in upgrades. (In Cypress, TX)
1st home selling for 155,000 cash. Owe 125,003 (official payoff from Citi) We should clear a little over 17,000 at closing. This money will be used toward securing the lot (3,500) and reaminder for down payment and clsoing. We should be able to add about 5-6,000 to this over the next 6 months.
Current Combined Gross: 112,000.00 AGI according to 2013 tax return 106,000.00
Husbands scores 652 Ex 667 TU 682 Eq
My Scores (why I'm worried) 614 Ex 625 Eq 652 TU
No lates since 2011 (and that was isolated 30 day on a student loan) Most bad info is from 2007-08 (right before we purchased 1st home)
We each have an old charge off from 2008 (Mine is with Capital One and they are still reporting it each month)
The reason for my lower score is high credit utililization (about 90%) I've paid this down to 80% (not reporting yet so no budge in score yet) and will have it paid down to about 10% in the next 3 months. According to Equifax simulator this should put my score well above 660 and my husbands pushing or above 700.
We have about 1250.00 in payments each month (minus current mortgage that will be paid off through sale next week) 705 Cars 300 Student Loans 250 Credit
I have two small medical collections (about 600 total) that are from 2008. I assume they were just sold so they were recently report as "new". Something else that hurt my score. I can pay these if needed, but will wait for specific instruction from a LO before doing so.
Perfect payment hisotry on 1st mortgage, all vehicles, and all credit cards received since 2009
We are just super anxious to get this process started (working with realtor) as the subdivision we want to build is filling up fast! Hoping someone has some insight as to how this whole process should work out for us. I know building new esentailly requires the process of qulaification and approval to occur twice. If we are approved now to get the build started can we qulaify for lower rates before we close since our credit will very likely be better?
being house poor while earning 112k isnt possible 
After paying the mortgage you still have more deposible income then most people make total.
However 230k home in Texas is gonna be a good one.