My wife and I are looking to buy our first house (we've both been longtime renters) in the next 12 months, most likely in the January-February timeframe of next year. We're looking at houses in the DC area, and most of the ones we're looking at now (just to see what's on the market) are in the $600k-$750k range.
Here are our stats:
- Joint income: Approximately $175k, should go up to $200k in a couple of months when I start at my new job
- Monthly debt expenses: Once credit card debt is paid off this summer, approximately $1200 (mostly from 1 car loan and 1 set of student loans, both mine)
- Down payment: Currently have about $25k saved, that should climb to around $30k by next winter
My wife has a great credit, employment, and tax profile. 14 years of steady employment, credit score in the upper 700s, and as uncomplicated a tax profile as you can think of.
Me, on the other hand...I've got some major issues that are really making me worried about our ability to buy anytime soon:
- Lack of steady employment: I was laid off in 2015 and again in 2016, and was unemployed for about 6.5 months the first time and 3 months the second time. I'm in my current job just until the new one starts this spring, and should be in the new one for the forseeable future. I'll have had a full year of steady employment (assuming no gaps between my current job and the new one) in December 2017.
- Major business expenses and corresponding low AGI: I started working on standing up a business in 2014 and after 3.5 years of hard, expensive work, it's finally almost ready to launch. I had about a $50k business loss in 2014, a $47k loss in 2015, and a $78k loss in 2016. As a result, my AGI in 2014 was about $22k, 2015 was about $32k, and our joint AGI for 2016 was about $74.5k. Even if I don't make a single dime in revenue this year, I'm looking at around a $15k business loss this year, much smaller than in the past. On the flip side, unless I completely screw up the launch of the company, I should be able to pull in enough revenue to offset the expenses and hopefully come in at least revenue neutral.
- Credit goofs: I've got one major derog on my credit reports, an unpaid charge off from 2012. I'm hoping to get it deleted this summer, or at the very least, have it report paid. Beyond that, I've got a number of lates from 2011-2013 that I'm in the process of a GW campaign for.
I'm really concerned about the lack of steady employment and the low AGI. Have I torpedoed our chances of buying a house anytime soon?
