<prompt> Human: About a year ago my grandfather died, and left my mom and uncle his house. My mom is going to buy my uncle out, and has already moved out there. My parents are willing to help my wife and I by letting us buy my childhood home, for about half of what it is worth. On zillow, the house is estimated to sell for 195k and I am buying the house for right around 100k. The main thing I want to accomplish is to avoid paying mortgage insurance.I visited chase bank, and had a meeting over the phone with one of their mortgage bankers. He kept trying to talk me into having the selling price be 195k, and have my parents gift me the equity they have in the house. So the selling price will be 195, they gift me 95k worth of equity, and my loan will be a bit over 100k. I want to roll in the closing costs, and have enough to replace the AC unitI have talked to one other person in the business, and he said that as long as I have over 20 equity, it does not matter what the selling price is and that I will not have to pay the insurance. My dad is saying that as well, but I have only talked to one person that actually gives this advice out for a living. Are there any proscons to having a higher selling price for the house? Will I, or my parents, have to pay taxes on the equity they would gift me? The banker talked about the equity like it was a tangible thing that only existed if we had a full price selling price, and we have the mortgage loan out for less. Is he trying to scam me into making more money? If I just take out the loan for what I owe my parents plus closing costs and AC will I avoid the pmi because I have almost 50 equity?Thanks for your helpAssistant: Taxes in my area are affected by the selling price, as are commissions on sales.Human: Homes are not always re-appraised during sale. His appraisal may stay at the current amount regardless of sale price.Assistant: Chase told me I would ha e to have it re appraised  <response>: he meant assessed for property taxes. Appraisal for financing is different. OTOH selling you the house for less than market may trigger income taxes for you and may be why the broker wants to value the sale at market. Consult with an accountant 