I would be suspicious of a lender that is bumping up the loan amount if there is no valid reason for doing so... sounds like they could be bumping up their commission. There is no rule that the buyer must pay full market value ... the fact that you are selling below market is even more attractive to a bank since there is less risk if the buyer defaults on the loan.
What they are proposing is that your family leaves the closing table with a hefty amount of money and incurring a larger mortgage payment to boot. Is that really the goal that your family pays interest for years on your generosity ?
Or does the family need to borrow more to cover closing costs? If so they don't need to up the price by 30K to do that.
I agree that you need to talk to someone else before going thru with this transaction.
