I believe they will average your income from the last 2 years.
Doing the math, you are right at a 41 percent DTI. If you can't get the waiver, you might want to think about FHA.
Your math is wrong.
For 2013: $3,985 earned over 47 days equates to $84.79 per day. So, for January and Feb you can be expected to gross $5,002.61. That's 2 months of your 24,
For 2012: you earned $26,936. That's another 12 months, for a total of 14 months.
For 2011, you earned $12,936 over 12 months. That's $1,078 per months, and you need 10 months, so $10,780
$5,002.61 + $26,936 + $10,780 = $42,718.61 , divided by 24 months comes to $1,779.94 per month on average.
$1,779.92 plus your husband's $3,208 comes to $4,987.92
Mortgage payment of $1,267 plus other payments of $785 comes to $2,052 per month.
$2,052 divided by $4,987.92 comes to 41.14 percent.
You need to find a way to get your other payments down, either pay something off or consolidate. Hopefully you are far enough out from closing that you can get an updated figure on ther other payments in front of your LO.
Elcid nailed it.