<prompt> Human: This is very difficult to describe but I will try.My friend and I have always said if either of us ever come into a large sum of money, we will try to help the other one out. He has received a fairly sizable inheritance. I have been trying to purchase a home for the last year or so. We have a 4 person family living in a 2 bedroom apartment. Our rent was just raised by 300 last month to 1400 and each month that passes is digging into our savings.We have not been able to purchase a home because of what amounts to quite a bit of credit card and medical debt. So on to my question: He wants to help us out with something like 20K. We are trying to figure out the most reasonable and legal way to make this happen. One possibility would be he would help us get our debts paid off so that we will have a larger monthly amount available for a mortgage payment. Another option would be to use the money toward a downpayment on a property. I will be using a VA loan which doesnt require a downpayment, but having one could bring down the monthly mortgage rate He doesnt want this to be a loan. He does not want monthly payments. He fully expects this to be a very long-term thing. He would like to somehow use it as an investment in the property we wind up purchasing. He mentioned the idea of putting a lien on the property for the amount plus some interest after the purchase is complete, but some people tell me that a lien is always considered a negative thing and isnt really a way to invest, plus it could prevent us from refinancing down the line and things like that. We talked about the possibility of him gifting us the money, and then after the purchase is complete we draw up a personal contract stipulating that at time of the sale of the house he gets a portion of the sale to include the amount gifted plus a set interest. Im sure there are many other options to make this work also but Im not sure what they are. We obviously would like to keep the tax burden down as much as possible, but also want to keep this all above board.We are in California if that makes a difference.Any thoughts would be greatly appreciated.Assistant: Please OP, dont mix friendship and money, it usually ruins it.Human: I appreciate the concern, and I do realize that it could cause problems, but A This has been the plan since we were kids, and B He expects that he will not see a return for many years down the road. If the roles were reversed I would be trying to find a way to help him out as well.  <response>: Lots of people have plans since they were kids. Many people had plans of being space cowboys and rocket doctors. That doesnt mean that those plans are GOOD ideas.If you go forward with this, keep in mind it wont be easy, will GREATLY complicate the mortgage process, and will be a hassle to untangle if your friendship wanes. 