With that low credit rating, that is a good mortgage rate.
You can always work to upgrade your credit rating and then refinance in a few years if the interest goes down.
You can lower the overall interest cost by making your normal payment on time, then making a second payment later on in the month for whatever you can afford.
Personally, I don't think buying real estate right now is a good idea unless you are in a really good job market area. East and west coasts are out. Overall, the whole mortgage mess is still gaining momentum, with another subprime bubble forming. It may take 20 years for the mess to shake out.