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Other than the student loans, do you have any credit accounts (revolving or installment) open and actively reporting your on-time payments to the Bureaus (all 3) each and every single month?
67% of your credit score is determined by the manner in which you manage those open and active accounts and it seems to me you don't have them.
If valid, I'd recommend paying those medical bills. Sure, they are going to be overlooked and excluded while purchasing a home using an FHA loan, but just being unpaid is a bad sign.
What's the nature of that $1588 PDQ collection account? Is it utility based?
Do either of those derogatory accounts list a payment amount in your "monthly" payment column that a lender will include in your DTI? (This might be a hypothetical question at this point in time, but my point will be for you to get these accounts identified so that you can address them NOW so that they don't prohibit you from having the "best score" or prohibit you from buying a house. ) Think about it this way---You have two accounts that show $2000 delinquent or derogatory. Don't you think you'll be better off in 6 months if those accounts (if valid) were reporting paid with a $0 balance? This is why I would recommend paying them off or settling them if they are legit.
Do you have savings for down payment? where are those funds coming from?
Do you have any savings for reserves?
First, regarding your Chapter 13 that was Dismissed, know there is no waiting period to purchase for either an FHA, VA or USDA RDL. Conversely, Conventional Loans will require at least a 2 year waiting period with extenuating circumstances and 4 years without. NonQM Loan Program may also allow a purchase or refinance without any waiting period but the rates and fees are much higher. For now, let's assume you will finance using an FHA 203b loan. Since I would not be able to get an AUS (automated underwriting system) approval for you, your loan would be downgraded to a manually underwritten loan. Unless you are living with your parents or family member, you will need an acceptable (no 30 day late payments) 12 month rental history.
Second, the normal down payment with a 580> credit score is 3.5%, but if your credit score is 500-579, then your D/P will be increased to 10%. I would immediately open the closet, bring out the dead, and bury the bones. Meaning concentrate on cleaning up any open collections or charge off if you can. Next, since you have no revolving credit, your scores will stink. I would apply for a couple of secured credit cards and make sure you and your spouse go on the account jointly. Charge up to but not over the credit limit then strategically charge and pay maintain balances of less than 10% but NEVER $0. Do this and your scores with come up at least 45-75 points not including any collection pay offs or PFDs. Try and pay the original creditor or service provider on any collection accounts. If they accept payment from you, you can get the collection deleted. Hopefully this gives you a road map.
Best of luck to you!
Having a VOR (verification of rent) is really important on a manual. If you are paying a third party like a Apt. Complex, Management Company, Realtor you are good to go. But I would recommend for the months to follow, you need to start writing a check, pay online, or use money order that can be traced back to a bank account. I have had luck in some cases, where the borrower's bank statements for the past 12 months, clearly showed a withdraw of the rent backed up with rental receipts or a written verification of rent from the Landlord. Unless you can prove your paying it can be an issue and even a deal killer. That is unless you can get a letter from a relative stating you are living rent free.
No you can't fib! You should start by paying so the payment can be documented.