I believe the new guideline for lower scores should come out sometime in April, I'm not quite sure though. Talk to a lender, they should know more about it. Besides FICO score, lenders also look debt-to-income ratio, credit history length, etc. Talk to a lender who is not just going to qualify or deny you but who will run different scenarios with your credit to see what would be the best one for you. They have special software where they hypothetically change something on your credit (say, you payoff your car or a credit card), what it'll do your score.
Also, check out these guys: http://www.united-credit.org/default.aspx
I wrote an e-book on this subject, it's free I can email to you if you would like to. Give me an email and I will send. You might also consider credit repair to repair and rebuild your credit rating moving forward, then you can qualify for a good mortgage not just qualify. Good luck!
Be careful of credit repair businesses and seek out the advice of a full service Mortgage Broker who will assist you free of charge. They will analyze your credit and help you on your way to a higher score because they want your mortgage business in the future.
Let me know if you'd like my help in finding such a property. Yes, I can even find you one in Michigan.
Rosen & Company West
Your credit may not be as bad as you think and you may qualify.