Anyone qualified for a mortgage lately??

I'll admit, I'm really bad at keeping up with the credit-crisis news. I don't know much about who's bailing out who, who bought who, and who's about to fold, etc.

But I really want to buy a place in the next 3-4 months, and don't even want to start hoping for a miracle if I'm nuts!

Is anybody still giving small mortgages (under $200k) to poor folks with iffy credit??? My credit isn't awful; I don't have any bankruptcy and I only have 1-2 late pays in the last 6 months, but I have a couple OLD charge-offs from way back, and a higher-than-recommended debt-credit ratio.

What I DO have going for me is that my latest mortgage was on-time, everytime for 2 years and is now paid-in-full.(sold the place for profit)

I also have my Veteran's Home Loan Guarantee Certificate; meaning the VA will guarantee the first 25% or $50,000. of a mortgage for me. (IF I qualify for that said mortgage)

I am downsizing, so just looking for a little place on 3-4 acres in the $80,000-$130,000 range (my last mortgage was for $110,000.00 and I have the same income as then).

Am I crazy? Are they only lending to people with 750+ credit now?? Or is there still a niche somewhere that still gives "sub-prime" loans???