Buyer-funded down payments questioned by FHA.

Joe Thompson bought a house this summer with help from an unlikely source: the owner.

Working through a nonprofit agency, the owner paid a portion of Thompson's down payment. The arrangement allowed the owner to sell her house and gave Thompson a down payment he could afford.

It's a novel way to defray the rising cost of owning a home, and a method that's increasingly popular among nonprofit agencies seeking to help first-time and low-income buyers.

But it might not be around for long.

In cases where mortgages are insured by the Federal Housing Administration, the agency is seeking to bar nonprofits from funneling down-payment assistance …