Refinance after cash purchase

[Ryan O.]

I need some input for the community.  I have a friend who's daughter is shopping around for her first home. They are hoping to purchase a distressed property and rehab it for the daughter to live in.

The strategy is for my friend to loan his daughter the purchase price of the home, say 180K, so she can have the advantage of purchasing with cash.  Lets assume the loan will not be recorded.

The daughter will use her own funds to rehab the property, refinance with a conventional lender once the rehab is complete, and pay back the loan from her father.

Will a lender allow this?

If so, are there any seasoning requirements?

How much would the daughter be able to refi for?

Thanks