Eric's Credit Community

My dream is in jeopardy, please help.    

I am a 53 year old widowed nurse.  I have been resolving credit issues since 3/06, as I am wanting to buy a house before I retire. 

There are 2 inaccuracies on my credit report, which I am working to have removed...the Verizon bill was paid to them, credited to the wrong account, and should never have gone to collections.  The second is a credit card, I returned unused, with the contract unsigned, because the fees were too high on the disclosure. 

I have a low DTI ratio, I am employed fulltime in a position as Home Health nurse, and I enjoy my job very much.  I have been employed since I was 16 years old.  Some of the issues that I have been paying off were due to the death of my husband, which was sudden and unexpected.  His income was about twice what mine was,  the insurance did not cover all of the expenses.  We were underinsured for Life insurance at that time.I have a realistic budget, posted below. 

I live in a small rural town, my hobbies are doing photography for my church and it's members...it occasionally pays a little also.  Usually I only ask for expenses, as most of our members are young parents wanting nice photos of their children.  I enjoy nature walks, reading, gardening, and my cat.

I am not an irresponsible person, just unfortunate.  I wish to make the debt right, but avoid a judgment that could hinder, or make it very difficult to obtain a mortgage.  This debt stems from some educational books that I contracted to buy, and defaulted on the loan.  It now is in the hands of a collection agency, who wishes to sue me.  Their reaction to my asking for validation upon being contacted, was to inform me 2 months later they had filed a lawsuit against me.

I have adequate means to pay the loan back, as you can see by my budget.  I have been paying things off or I would have had money to do this myself, but the need is urgent.  I don't have family that is in the position to help. 

I have been told to post a photo with this, however I am unable to right now.  I'm having issues with the program on my computer.I thank you for your time and consideration.

Mthly Income
Base    2200.00  4 wks  
Other    Will list on eBay not guar. $
Total     2200.00  4 wks  

Pymnts
Rent  325.00 
Car      none
Credit Cards   4 total approx.  1500.00
Prosper Loan  (pending
Other     1600.00 med.  bill 
              3107.00 books for educ (pay-off to avoid judgment)

Exp.
Utilities   82.00  mth
Gas       50.00  propane
Insurance   (car) 107.00
Car   pd off
Rent    325.00
TV   cable  42.17
Online    21.95
Phone   35.00
Cell     65.00
Gas (car)    avg  160.00  mth
Food   avg  200.00  mth
Other   med   200.00
Misc (15% pay)   330.00
Total Exp. & Debt =   mthly exp total 1288.12 
Total cash flow = $911.88  (money left after payments and expenses)

Thank you for your attention.