MONEY-SAVING MOMENT: As a result of the housing crisis, mortgage lending standards went from no standards to very tight and strict. That's left some homebuyers locked out of the market because of the new regulations and new down payment requirements. While there are options through the FHA or VA, many people can't do those either.
Well, I may have a possible solution.
Smart Money magazine reports some states are offering what used to be called "down payment assistance plans" but are now more often found under a variety of different marketing names. These programs cordon you off as "moderate income homebuyer" based on income. Each state has a different definition of what that means, so your income can essentially be anywhere from $50,000 to $120,000 to qualify.
With these programs, you may be eligible for an outright grant or some other form of assistance. Most programs have a requirement that participants attend homebuyer education classes. I see these clases as a carrot rather than a stick; they can really teach people how to manage their home payments and avoid foreclosure.