You also need to improve your credit score. For FHA loan, the minimum credit score requirement is 580 to qualify for the low down payment advantage, which is currently at around 3.5 percent.
Just to comment on the student loans. I did rehab my loans and it is still the better choice than refinancing/consolidating. If you rehab the loans they will open a new account, that is back dated from your original loan account opening but now showing good payment history since you started the rehab payments. So this helps with AAoA and now has a positive installment loan on your CR. However, they do not remove the lates from the old loan. It will just show closed with 0 balance but will continue to show the 60/90/120 day lates or whatever you used to have. The benefit is the account will stop reporting as late each month and kind of stop the bleeding on your credit score. If there are 120 day lates on it, they will unfortunately haunt you until the account is removed at 7 years from DoFD (which is still killing my score).
On the collections, depends on how old they are. Do not pay old collections. Anything over 2 years from the first late can be disputed. Collections fall off after 7 years from the first late (final no pay) date. Over 3 years of no pay, you would call the credit reporting agency they are on and dispute. They must by law prove by providing you a wet ink signature you signed on the contract. They can't. And if they cannot prove, the credit reporting agency must remove. Most companies do not keep original paperwork after 2 years. They may have scanned it to their computers but those don't count. That is the loophole. I am not saying this for you or anyone to take advantage of companies. But credit reporting agencies were put in place to show good credit.
How old are the collections? If they are over 5 years old, let them go.
When applying for a mortgage, UWs do NOT want to see any disputes on credit reports, regardless of reason(s).
How long have you been on this full time job?
How much money do you have saved in retirement accounts?
Why only one credit card? Open another ASAP even if it has to be a secured card. You might even be able to settle with CAP 1 and get an account re-established with them.
HUD (insurer of FHA loans) won't finance land without a building on it so you will need to buy, build and finance all at once but it's certainly doable in this day and age.