First things first, you need to understand how insulin works...
A low fat diet is usually a misnomer. Foods that are advertised as low in fat usually have tons of sugar added to make up for the loss in flavor.
If you have high blood sugar, this can complicate things as well. For instance, you'll probably want to avoid certain fruits with a high Glycemic Index value (high GI). Try to eat more vegetables. I can spend lees than $10 where I live and have enough brocolli, celery and apples to last me a week.
The key to understanding losing weight is to understand how your body uses and stores energy. Forget about any fad diet. They are all a bunch of crap. The only way to really lose weight is to figure out how everything works together and then work it out like a math equation.
In a nutshell, you need to keep control of your blood sugar and insulin (they tell the body to store or release fat). And keep your calories at a good maintainance level. You should be able to get a ballpark number here
. I can give you information to get exact numbers if you really want, but an estimate should be a good start. Make sure that you use the weight that you want to be at and not your current weight. If the weight you want to be at is more than 25 pounds less than what you are now, then use half of the difference (I'll explain this later) for your "target" maintainance weight. Also use the "sedentary" value as it will give you a bare bones number and not one based on intangible numbers.
Here are a couple links dealing with calories and dieting...
Whatever you do, don't starve yourself. If you don't get enough calories, your body will go into starvation mode. Your metabolism will slow down because it thinks it is starving. Your body will then start to store energy (since it is starving and will need it later to survive). By the way, stored energy is also known as fat. When starving, your metabolism slows and muscle is consumed (catabolism) to support the body. Muscle is the primary consumer of calories; you start losing it and your calorie requirements drop radically.
I don't know what your personality type is, but if you can research enough of this (PM me if you want more info, I have TONS) so that you understand it the rest is a peice of cake.
Or not. Understanding is the beginning. You have to have the will power to resist the Krispy Kremes and peanut m&m's. That's a whole different story though.
If you need any info concerning exercise, let me know. I can give you more info than you'll be able to use. For instance; how to time your cardio exercises to synchronize with your lowest glycogen levels to maximize fat mobilization. there are other points I could make, but I'm not going to type them out unless you're interested.
As far as food is concerned, I can offer lots of advice as well. Find out what your caloric needs are and I'll provide you with a simple system to keep everything incheck so you can eat what you want (diabetic no-no's aside) and still be on track for your target weight.