Need a higher appraisal on refi

[Fillipe Silvas]

I recently purchased my first investment house using a hard money loan. I am planning on using the BRRR strategy to continue to build a portfolio. SO many mistakes were made but I have also learned so much and had a lot of fun going through the process. The issue I'm going through right now while going through the refi process is that the appraisal for the refi loan came in $9,000 lower than the initial ARV appraisal did. I'm not sure how this happened but my lender and I are going to try to fight it to get it higher so I'm not so much out of pocket on the refi. Just wondering if anyone else has been through this or has any advice on what I can do to get this appraisal higher.

[P.J. Bremner]

"Appraisals are like a box of chocolates... You never know what you're gonna get".

-Forest Gump

No, seriously, they seem totally random and at the whim of the appraiser.  I had an appraisal done recently on one of my properties that should have brought MINIMUM $550k but more realistically $600k.  They came back with $502k and had absolutely no logical reason behind it, which cost me at least $40k worth of loan that I can no longer access.  

When I was originating mortgage loans, I could count on 2 hands how many of my team's loans PER MONTH would go bad because of appraisals that were off. One particularly egregious one comes to mind: Client had a condo in a complex of many condos of similar (pretty much cookie cutter - the same) size and style. Subject property and comps were LITERALLY the same square footage and layout. Subject property was remodeled within the last 5 years or so and comps were remodeled within the last year or less, so very minor wear and year between the two. Comps were all in the high $650ks and the subject property came back mid $500k. What the hell was that appraiser smoking? And can I get some of it PLEASE? I've seen all kinds, you are not the only one to deal with this and if you continue in REI (or even your personal home) you will continue to see bad appraisals from time to time. Certainly not the majority of appraisals, but I would say maybe 20% - 30% of the time (WAY too much for my comfort). I'm sorry to hear you are having issues, hopefully you can fight it, but in my experience on the lending and investing side, the appraiser won't budge unless they made a trivial mistake (forgot to take into consideration major highway dividing lines, incorrect square footage on records, fat fingering an address, etc.)

*Edit* The only thing you can do is run your own comps, write out all of the supporting reasons why you think your comps and appraised value are more accurate than theirs and wish for the best.  At that point, it's like going to court and arguing why the cop pulled you over: it's your word against his and often times, the cop will be believed more often than you because he is a professional... (hard to call some appraisers professional when they can't do their job right lol).