Start seeking out lenders. Interview them or talk to friends, co-workers and relatives who have had a great experience with a lender or REALTORÂ®. Try to find one that specializes in first-time home buyers. It is a very different kind of animal and it takes patience and a clear understanding of credit issues. I have several lenders who have helped many people get from where you are to where you want to be. Unfortunately, they are in Wisconsin and you are in New Jersey. I am sure, however, that you have great people in your neighborhood. You just need to find them.
I do know that one way to increase your credit score is to get a credit card. Charge your gas, food or other necessities -BUT ONLY IF YOU HAVE THE CASH IN HAND TO PAY THEM WHEN DUE!!!! Be very careful here that you do not create more of a problem. YOU MUST HAVE THE MONEY BEFORE MAKING THE CHARGE AND YOU MUST BE VERY DISCIPLINED.
If owning your own home is really important to you and you are diligent, you will get it!