In many cases, what people do is get the money from a relative, or friend, give the bank a gift letter from that person, then turn around and pay that person from the HELOC.

how about gift from family?

Gift funds are available as well for their portion of the down payment. 

Wow, popular thread...I only read the first page, so I don't know if this has been addressed, but in my opinion, everyone who posted on page one missed a very important factor: Taxes.I'm not a tax professional, and maybe there's a clever way to get around this issue such as a permanent trust, living trust, etc. but I'm fairly certain that she'll have to pay income tax on that house you are giving her for the amount that passes the gift exemption.

If you pay the back taxes on a property you have done nothing but given the property owner a gift.

Some things that come to mind are adaptations to some things buyers might do in a competitive bidding environment: Submit a letter of explanation to the buyer's agent explaining how you love the house and will find the perfect tenants/next owners/etc.Be the first and best offerPresent a no-strings-attached gift with the offerI'm curious to hear other suggestions.  

so from a little research I found that each year you can gift up to 15k without being taxed.

And as a parting gift the house was trashed.  

Gift Cards at Holliday season if they have behaved all year.

Did he sell it, gift it, loan it, lease it, or let them live with him?