I would contact the appraiser and aside from voicing your argument I would send him three better, more suitable comps that illustrate three properties in areas as nice as yours that have a garage, etc and layout similar to what you have. It would definitely be worth taking a few exterior photos of these comp properties to show the appraiser what's up.
I would also like to hear what @Brandon Turner would do.
Assuming you collected security deposit for down but tenant hasn't moved in? Is there a lease signed? Have you presented both leases to the appraiser?
I doubt the rent estimate has much to do with the valuation. Duplexes are valued using comps, not income. The rent estimate may affect your ability to qualify for the loan, if that income is considered by the lender. But if you have signed leases, the lender should consider those.
The best time to have addressed this would have been when the appraiser was at the property. That's the time to provide a list of comps and what you've done to the property. May or may not have any effect. Its always a crap shoot when it comes to which comps an appraiser chooses.
Tell the lender you want to pay for another appraisal because you know the property is worth more and the appraiser won't budge.
Most of the times, appraisers wont budge if you ask for a review because then they'd have to explain why their first appraisal was so far off.
I've had to do it 3 or 4 times over the past few years. And surprise, surprise, every one of the re-appraisals came in at or above what I suggested they should have. Typically its because the first appraiser is just a goof and doesn't know what they're doing.
I really think the problem is that they see what we paid for the properties and just assume there's no way we could have gotten such a huge discount so they find irrational ways to comp the property "down".
But that would be my suggestion in your instance. Pay for a re-appraisal. And be sure to tell the new appraiser this is why and that the previous appraiser would only give you 1700 for the rent even though you had a signed lease putting you at 2100/mo. And then tell them that the bank agreed with you too and couldn't understand the appraiser's numbers.
Its worth the cost if it means paying 500 for another appraisal and you can get 15k to 20k in appraisal price when doing a cash out....
But getting an appraiser to change their number on a review is almost impossible.
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