This webpage discusses the idea of bidding higher on a home in exchange for the seller paying closing costs of the same amount. Is it also permissible to bid higher and request the seller pay for (some or all of) the down payment, too?
The benefit, from a buyer's perspective, for having either down payment or closing costs paid for is that the buyer is saving dollar-for-dollar on upfront costs in exchange for a slightly higher monthly payment. Over the lifetime of owning the home (say 5-10 years) the accumulated excess monthly payments will be less than the upfront savings (sometimes substantially).
A possible complication here is that the home doesn't appraise for the higher sale price, which may complicate financing. But assuming this isn't an issue, are there other gotchas to be aware of?