Generally, a lender requires as an absolute minimum that the buyer put at least 15% down. (more commonly, 20%). So I get the impression the buyer is telling the lender the purchase price is $300K, since 80% of that is $240K. I think they only have $10K to put down and not the necessary 20% which would be $50K. Or if 15%, they would need to put down $37.5K.
This is loan fraud and the buyer will be implicated in this, if this is "in fact" what is going on here.
More than likely though, this deal would fall apart at the closing, if the lender's appraisal didn't kill it first.
