I hate to be the voice of reason here but I have to disagree - this isn't the time to just rush off and somehow get an FHA. if you haven't managed to save $3-4K then you appear to be living paycheck to paycheck. That's really not the best combination for a home-buyer. If you somehow borrow the min downpayment, get the house, and ANYTHING happens to your income then you'll be in a LOAD of trouble and be in foreclosure soon enough, with your credit ruined and perhaps in bankruptcy too.
Please be aware that this Buyers market will last for quite a while. Especially in a secondary market like Philly. Philly isn't going to recover the way that primary markets will. It will be very reasonable for you an entire year from now - and perhaps quite a bit longer. I'd advise putting together a really good plan with your husband to live well within your means, earn more if you need to with 2nd jobs, and put money in an interest-bearing safe account - perhaps something like an Orange account - they pay better than the usual banks.
A year from now, you should have what you need, take advantage of the $8000 tax thing and have a more disciplined approach to budgeting and spending so that you will be able to buy a house on big discount and a much better chance of keeping it.
I am a mortgage broker. If I can be of service, please let me know!
877-238-6324 Ext 704
There are programs available that can assist you with down payment costs. You should visit http://www.naca.com. It's a great non-profit organizaton that my be able to help you with down payment, closing costs and attaining a mortgage. Do you & your husband have a steady income? Do you have a strong credit history? Even if you don't a program such as NACA will counsel you for months on end until you are financially prepared and informed to become a homeowner. If you think this is something that you may be interested in you can contact me all my info is on my profile page.
Realtor / Marketing Specialist
Jordan Baris Realtors, Inc.