Gift of Equity: An arrangement where the seller gives all or part of the equity in their home as a gift to the buyer. This type of transaction is beneficial for both parties, as it reduces the purchase price and allows the buyer to use funds that may have otherwise gone toward closing costs or down payment requirements. In addition, the seller receives tax advantages from gifting the equity. While this type of transaction requires careful consideration and expert legal advice, it can potentially prove advantageous for both the buyer and the seller.