First Duplex - Appraisal Question

[Bart Plummer]

Hi All,

I've been reading BP for a few months and finally got the courage to jump in. I've learned so much but I seem to be stuck at a point I can't find any info on.

I have a contract on a duplex at $113.5k. The mortgage appraisal came back at an 'as is' value of $109k based on sales of comps and $114k for rental comps. I believe both are a bit low but within reason.

The issue I'm running into is the the appraisal remarks mention that it has old Masonite siding and it is in need of replacement and estimated the costs to be around 12k. The price on the duplex has already been significantly reduced for this and some other general wear issues. The lender is now coming back and saying they will not close until the 12k in repairs is done. Is that right? If so then shouldn't the 'as is' value actually be some sort of ARV value on the appraisal?

My assumption was that we could either go back to the seller and ask for a price adjustment or worst case just cover the 4.5k difference myself (or some combination). I never thought they would want 12k put into it before funding a loan that is basically what it is already appraised at.

Thanks for any input from a confused first timer.