Appraisal came in at 235k, Under contract for 277k. Buyer here! HELP!

[Atampreet Singh]

Hello all,

I am under contract on a 4 bed 2 bath home in one of the nicer suburbs of Detroit, Auburn Hills. 

I am under contract with seller right now for 277k with 8k in seller credits negotiated upon inspection.  

Now, somehow, appraisal has come in at 235k.

Since, this house has a lot of earning potential for me as a mid term rental airbnb. I would like the deal to not fall through 

Seller has sent in writing a counter for 250k with no concessions, and has asked me to sign mutual release if I don't accept. 

Any thoughts from experienced investors? 

how would you go about negotiating price or buying with sellers terms as is?