My friend is going to sell his house and told me he can give me a good price . If I buy the house for 200k, can I ask him to sell it as 240k and give me 40k back after closing. In this way, it is acturally 0 downpay and I can simply walk away from if I lost my job and have difficulty to sell the house . Apprisal won't be a problem because the price is good. Just wonder if there will be any tax problem or any other problem I don't know.
Yup, it's called straw man scam. It's not just a tax problem, but a federal offense. Proceed at your own risk. And you didn't hear it from me, because I never read your post, just for record.