Parents/daughter on cash purchase contract, can daughter get loan

[Kelli Tarantino]

My husband and I are in the process of purchasing a home for cash, and my daughter (who has pre-qualified for a loan) wants to live in the home and take out a loan to pay for it. We are going to ask the seller if it's OK to add our daughter to the contract, and if he would be OK to extend closing by allowing our daughter to complete the loan process, thus changing the original cash deal. If the seller doesn't agree to these new terms, we would like to move forward with the cash deal, and figure out best options for my daughter to obtain a loan (we would gift her the down payment of $20,000). What options do we have, and what are the tax ramifications, and additional closing costs involved? I've read a bit about delayed financing and cash out refi's.