The trials of building a home

So, we were given land by my husband's uncle. We were working with a builder who was going to build us a split-level home with a basement for less than $145,000. We were approved for our loan through Rural Development approximately 3 weeks ago and found out we were approved for $172,000. But because of the higher taxes where the land is, we will need to keep the price of the home under $145,000.
After working with these guys for the last month or so, on Monday they told us that they didn't want to go through the Rural Development approval process anymore. Their excuse: something about a requirement with stamped prints that would cost $750-$1000. In NY state, all plans are required to be stamped anyways. So we still don't know what their real problem was. They tried to get us to go through a regular bank for our loan. There is no way we would go with something that would be more expensive. Our payments with Rural development will be $742 a month including taxes and insurance. How could any bank give us that low of an interest rate? Seriously!
So, now we are back to looking for something else. We are currently considering some modulars that are 27' by 52'. We chose this size because we think that because these are less expensive, we will be able to have our basement. We will also be calling the one other contractor that was on the approved list for this county on Monday. We will see what happens. We also still have the choice of buying an existing home. The only problem with that is that real estate around here has not went down. People are not selling their homes and the ones that are for sale are either something we don't want, overpriced, or gets an offer really quickly.
The thing that sucks is that we have to start the whole process again. But, hopefully something will work out soon. This apartment is too small for all of us.