Cash Out Help

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I am dealing with a REO property. Appraisal is 150,000 but all of the comps sell for about 140,000 or less. The home needs 12,000 to 20,000 in rehab to get it back to life. I am preaproved for a loan but the down payment will clean out my cash I made an offer for 110,000 and I am sure they will counter. Okay, this is my question. With an apraisal of 150, it they will except 120, will they also except 140 with 20 back in cash for renovations. This is my first deal like this and I do plan on living in the house for a number of years.

Thanks for your help
upcojr