It might cost a bit but it will save you from expensive mistakes.Advice you may get from Internet posters is worth what you pay for it :)

Just confused on what to do here... do I need to talk to her lender about the lien, I have scoured the Internet and YouTube but the best answer I’m getting is a subject to but without a mortgage, and only a lien... how can I do this?

A great bet as mentioned above would be going with a house and an ADU.

I imagine an FHA loan is probably the best bet, but does anyone have any advice or suggestions to try to get a loan with not the best credit.

Like Russell notes, FHA may not be your best bet.

Your best bet is to assure the buyer you work with some fantastic lenders who can provide specifics concerning the requirements. 

@Richard Wilson congrats on taking the first steps.House hacking the first is your best bet. 3-4 family definitely a sweet spot.

@Andy Nathan right now I'm just doing searches on the internet trying to get my feet wet.

In a buyers or neutral market most sellers post at least 15% higher than they expect to get, so you can adjust & reach out even if the list price is too high, in a hot market all bets are off unfortunately.

@Aimee Lawrence  Right now your best bet is someone in the construction trades as far as a renter .