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My husband and I have been patiently waiting to buy a home for years. We had a lot of obsticles that kept us from being where we needed to be that we have now overcome. We have been in a lease purchase for the past couple of years for a home that we will be purchasing for $250K and we have accured about 10K for the downpayment though we may be able to come up with a few grand more if needed to close.
Here are our current issues: I am self employed & my spouse is on SS Disability. His income is non-taxable. Majority of my income is through a contractor position that I have held with the same employer for over 6 years now. After our accountant completed our income taxes this past year, I was concerned it might not appear that we make enough income to qualify. I currently bring in 60K per year for this contract posiiton plus another 5-10K in additional contract work. I have roughly 5-7K in expenses however, the way my home office is setup it is a large portion of our home and after they completed the home office exemption and household related expenses, my taxable income appeared to only be about 20K.
Since the majority of the reasons my income looks so low is due to our home expenses which would be similar if we were to purchase the house, how would they look at my income for qualifying for a mortgage? Would they look at it before the home office exemption was used or after? Also, I have heard that SSD income is sometimes counted as more due to being non-taxable. Is that true? My spouses income from SSD is roughly $30K.
I also wondered if being self-employed ended up causing too much problems if my employer ended up hiring me a a fulltime employee instead of a contractor if that would change the situation. We had discussed doing that as well anyways.
I appreciate all of your input. I have been dreaming of being a homeowner for so long and we finally found our dream home that couldn't be more perfect for our children.
One of the conditions that came back was to provide a P&l and also a balance sheet for our business since we are self employed. That is a new requirement with FHA with no exceptions! They asked for it to be from a CPA which we do not use. I just gave underwriter documents from quickbooks that I use and it was excepted. closed in 60 days. Just remember that they use net numbers not gross and you should be good to go.