Many local and state agencies administer bond programs to generate funds to help individuals and families with a down payment.  Contrary to common public opinion, these bond issues are not a type of welfare.  The government knows that it can be tough to buy that first home, especially on a limited income.

Most agencies are income sensitive, but you may be surprised by the high level of acceptable income.  The acceptable income level is higher if you have children or dependents.  Most agencies also have purchase limits, but they are adjusted to the income qualifications level.

If you are able to obtain down payment assistance, you may receive a lower interest rate. On the downside, however, qualifying for the assistance often takes extra paperwork and requires the borrowers attend mandatory education classes.  Find a realtor or mortgage professional who is familiar with both the local and state agencies and their policies.