When a contingency is over priced; and the probl Buyer/seller cannot come down because there will not be enough equity left to make the deal fly; then one answer is to persuade the Seller on the other end of the deal to drop his price; but in this degree: Seller comes down Ten Thousand Dollars (for example) and gives it to the contingent buyer PROVIDING the contingent buyer lower his price by said amount. The Seller then signs a note for the ten grand concession to be paid to the Buyer/Seller through the escrow closing.

I think I see a third party contributing to a buyer's downpayment which will probably be a red flag for the lender.

Why should the buyer agree to over pay for a property to make it work for the seller? Find another home.

Looks like loan fraud to me.
http://www.frascona.com/resource/jag902fraud.htm