I'll bite: how did they work around the issue?
This is the kind of thing that's impossible to do getting quotes from a website, or talking to someone that works at your local branch. It's a matter of knowing how to package your application and then being able to speak with someone that actually has some ability to make the decision.
Not knocking you or your situation specifically, but in general if someone is not a great risk, but that goes away if they get someone to make the right phone calls, is that a good thing in the big picture?
Not judging, just posing the question.
Mortgage broker got it done very easily (albeit with Countrywide, not exactly known for the strictest of standards :) ).
Never missed or late on a payment on that loan.
Every business makes a calculation about what kind of business it wants to do.
I did not use a mortgage broker when buying a house. My reasoning was that they compete on price enough that the interest rates aren't worth shopping around for. The PRODUCTS may be. If I was doing a bridge loan to buy a 2nd house, I might shop around. If I'm doing a straight-up financed purchase on 2 stable well-documented incomes, I'm probably going to get about the same product and rate no matter what bank I use.