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I suggest you discuss it over with the financial institution that preapproved the current amount and see what are your options. You dont want to find yourself buying a home that its out of your price range. You want to enjoy your home not be stresed over the payments.
There are quite a few issues to address in your question. First, you can do as one poster suggests and bid lower to see what happens. If that doesn't work, you should find out how much your credit score will effect the loan by asking your lender, no one knows this but them. If your score doesn't effect what you and your family gets rate-wise, you can move on (which is many times the case with FHA). If your score does negatively effect your rate, or your chances of final approval, I would suggest some credit consulting which can come from aa third party of directly from your lender. You'd be surprized how much difference paying off small debt can increase your score. gGood Luck!
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