Wondering where to start

[Learning_Tee0225]

Im at the begining point in the journey of home ownership. Ive spent the last Year rebuilding my credit getting things removed and paying off any debt that was on my credit report. My goal was to first get an auto loan for a new car which i was able to do in May of 2012 and now by March of 2013 i would like to own my own place.

Im looking to buy a condo in Southern Ca, La County in the  city of Santa Clarita. It's where i currently rent a condo and ive been looking aroud the area I currently live in they have condos going between 98K to 115K that im looking at. (2bd 2bth some w/ loft)  Id like to take advantage and buy something now while to market is good.

I have had steady full time employment for the last 6yrs. Take home after taxes monthly is about 2900  last years w2s had me at 40K annual salary. It's just me alone applying for loan my scores range from 597EQ - 628TU - 636EX  mostly due to some high utlization on some credit cards which realistically I plan to pay down fully by Dec which should boost those a tad. 

I have two accounts in collections which i plan to pay off by Dec as well.

Other then that my CR shows:

5 Open and Active CC accounts all current NO Late pymnts

1 Auto loan thru Navy Fed fairly new 414$ pymnt 22k still owing.

Ive been doing a bit of research on my own and looks like id be trying to apply for a FHA loan using there first time buyers program. Im not Money rich as far as down payments and i read you can get a lot of assistance with closing costs and all the extra fees that are assoiciated with buying a home.

My question is what is the first step that i should take. Should i wait to pay down the CC in Dec before contacting a lender? Or should i contact a lender let them see where im at now so i have more of an aim of what to do?... Which lenders work best for people in my situation (low credit score, down pymnt assistance) I bank with Navy federal and was going to start with them..are there any other banking institutions i should look at for the "pre approval process"?

Thank you for any help/ responses i know everyones time is valuable thank you again in advance!

[germaine47]

I would PFD the collections that are showing on CRA's, in which I think will give your FICO a healthy boost.  It  depends on what the minimum Middle Score the Mortgage Broker or Lender will require.  I went with a Mortgage Broker and my Middle Fico Score had to be 640.  I printed out my CRA's and I let the MB look over my report prior to her pulling my Credit Report.  I didnt have a lot of money saved up, after paying off the debt and getting on the right track I went with USDA Gauranteed.  I paid O$ down payment and the Sellers covered most of my Closing Cost.  When it was all said and done I was out of approximately $600.00 out of pocket. Also, ask to see if your Closing cost can be rolled into the Loan.  I think Home Ownership is just around the corner.

[Learning_Tee0225]

Thank you so much for replying that helps a lot i cant wait to fully begin this journey. Excited and scared at the same time