Hello everyone; I'm a first time poster to myFICO but I have been scanning the forums for a while now. I've noticed we have some very knowledgeable people who populate these boards and so I wanted to see what you all thought about my situation. My situation includes a couple soft curveballs that I haven't been able to find advice on yet and frankly don't know how a lender will see it. So here's some info on me and my girlfriend:
- Credit. Starting with me, my credit score is currently EX630 EQ630 TU730. Up until a month ago, they were all around 730 and absolutely clean. Now I have a $50 medical collection reporting as paid. The debt itself is from 2011. I have been renting since 8/11 and I have never missed a payment. My G/F scores are all about 715-730. The only "blemish" she might have is a creditcard from a previous relationship that she is an AU on. Other than that, no missed payments by either of us.
- Income. Here is where it possibly doesn't look so great. We both moved to a new city in 8/12 so that I could go to school. We both now have part-time, near minimum wage jobs. I make around 8k annually before tips, and about 12k afterwards. I'm in school full-time, and I usually have about 3.5k left in student loans after school is paid for. She makes around 14k a year. This is all before taxes btw.
- Source of income. I sort of answered this above. Me: 8k hourly wage, 4k tips, 3.5k Student loans (is this considered income or debt?). Her: 14k hourly wage. This is all before taxes.
- Monthly debt payments. I have an auto loan for 167 a month that will be paid off in 4 months, and every now and then I let one of my creditcards report a small balance so maybe add an additional $25 for that minimum payment. She has an auto for about 110 a month that will be paid off in about 4 years, and she reports a little on here credit card every now and then so and additional 25 minimum. Altogether: 327 a month for the both of us. Again my student loans aren't requesting payment and won't be for 2 1/2 years. How is this viewed?
- Employment I work part-time in a customer service position. I've worked there since 8/12 and I've never worked customer service before. I've been working for 6 years now and I have never been fired and I've always had a job. I used to work in construction a lot. She has a part-time job in retail since 8/12. She has worked retail for most of her work life. She has been working for 7 years and has had some recent spotty employment due to medical reasons, but that is over with now.
- Assets/Reserves. I have about 2.5k (can I also include my car?). She has about 3.5k. So together, not inlcuding my car, we have 6k
- Location. Missouri.
- Property. We are looking at single-family houses with small lots and in living condition to be used as a permanent residence at least for 2 years. My degree could have me moving once I graduate, and so we would like to either rent it or sell it around the 2-3 year mark.
- Value. Around 40k - 70k. 40k would be the minimum I'd feel comfortable moving into and 70k is getting close to rental money so anything past that might not be worth the trouble.
- Occupancy. Primary Residence
- Transaction Type. Purchase
As a side note, I'm thinking of going with a blended mortgage based on our situation; maybe a 5/1. Are these types of loans only conventional. I've also tossed around the idea of going no money down. I'm also leaning towards FHA (fixed 30). I know I just contradicted myself, but I don't know enough about the "no cost" loans or the "blended" loans. I'm also very open to any suggestions, which is why I came to you 
If there are any questions that will help, please ask.
I think you would have a very hard time qualifying. With a combined income of 21K (probably less as most people get deduction happy at tax time) that's only $1750/month. Even if those incomes and your employment were accepted as is (big if) your 43% DTI is only $750/month. Take away your current debts, and that leaves you with just about $400 for the new mortgage, insurance, mortgage insurance, and taxes. This would probably mean you would be at best in the 40-50K range for a property.
Given everything you said, I would consider NOT getting a mortgage.
If this is not your forever house (you said maybe just stay 1-2 years and then you will probably move) I don't know why you would go through the hassle. Would you really want to be a long-distance landlord? Keep in mind, if you move and want to buy another house, you will not be able to use any income for renting for two years, but the mortgage will go against your debt limits. Now, the house you are looking at is relatively cheap, but that is still a $300-500 debt added to your DTI. Throw in a car and student loans and your future purchasing options slim out.
It's not the worst thing in the world to rent until you are financially ready to buy. Save up for the next two years, try to get out of college as debt free as possible.
Starting Score: 668