choose a reputable lender before you make an offer and check with him or her to see what the guidelines are for the loan program you intend to use.
many lenders allow a seller credit towards your closing costs. i have seen some as high as 5 or 6% of the purchase price, and many up to 3% for actual closing costs.
the key is that the credit is specifically described as a credit towards actual closing costs and pre-paid expenses, AND that the amount is acceptable to the lender.
as always, i suggest that you retain a competent real estate lawyer to help you as you go forward
On another note, this isn't the kind of market where you want to buy before selling. Having 2 mortgage payments is stressful in the best of times, and in a market like this it can be a disaster. There are bargains to be had, but the best thing you can do is sell first and come in as a much stronger buyer.
2. Banks consider the sales price to be the lower of the purchase price & the appraisal. While they will allow sellers to pay closing costs what you propose means that the home is effectively worth $10k less than your purchase agreement and that's the number they will agree to finance.
It has been my experience, that this is not allowed on the HUD statements any longer. Creative financing was prevalent a couple of years ago, but there are strickter guidelines surrounding what can and cannot go on the HUD. Find yourself a good real estate attorney, if you don't have one, I do. But, again, it has been my experience that there is no cash back option any longer.
Hope that helps.