With an FHA loan, the down payment can be gifted by family or use retirement accounts to fund the deal. 

Further focusing on what is in writing, I'm going to guess your friend signed a letter saying that the down payment was a gift, with zero expectation of repayment, since that would have been something the mortgage underwriter required prior to closing.

I understand that you have to do a gift tax return when adding them to the deed if you already own the house, but there would be no tax due, as it just goes against the life time gift exemption.

Hi,My parents are looking to gift me and my sister some money this year.

But in my experience Paul I always make contact with neighbors, I come barring gifts (donunts) and I get the full scope of the whole neighborhood and alot of the time they will look out for your investment always exchange numbers you'll be suprise what happens when you involved the people.

If it is "gifted" there are limits, check with your banker.

They said that this value would be cut in thirds (54K) and would mean each parent would be gifting me (27K) .

Bought/built the house for $210,000 on 5 acres of land that was gifted to me by my mom for only $1,000 .

Usually landlords talk about getting gifts for their tenants, but this is a little different.

@Valerie KingFHA downpayments are 3.5%, so you would need to come up with that amount, but it doesn't have to be your money, it can come from a gift, possibly from a relative.The closing costs vary from area to area, but around here closing costs can be 6%.