Why do you think he is basically giving you a $30,000 gift?

As a parent, you can also gift down payment to your child to help, so that should cover all the basis.  

@Marco HerreraWhy not get Grandma to do a gift of equity and then refinance it for cash out within the next year?

If she's giving it to you during life then it's likely a gift. 

This is very exciting for me, and its a pleasure having the gift to learn from Bigger Pockets!!

It is probably small enough to avoid gift tax, but what happens when you transfer title to his name at 18?

They disguised a rent request as a free raffle for $250 to show their appreciation: "Enter to Win a $250 Gift Card!"

because 1. you cannot get an FHA loan (or any conventional loan under 80% LTV) if you are not living in the unit for at least 1 year. 2. you can only get "gift funds" from your friend as a downpayment if its a primary.

Don't look a gift horse in the mouth -- make sure its well-fed, its groomed, and is content.

Since then she gifted me the loan which is now $35,000 I had it attached to the property in 6/ 2013, that is what it stated in the default.