Bank challenging appraisal on a BRRRR

[Nicholas Boccella]

So I hear all the horror stories of getting a low appriasal when attempting a BRRRR deal. The issue I am having is a little different. I purchased a single family property at $51,000 and put about $30,000 into it (also a lot of sweat equity). When I ran my comps, I came up with an ARV of $130,000. I applied for the refinance requesting a loan of $100,000. I just heard back from the appriasal and it came back at $141,000! I was thinking I hit a homerun! The bank, however, feels the appriasal is incorrect due to me only being into the property for $81,000 and claiming the comps are not true comps. The bank is now challenging the appriasal and changing the terms on the loan.

Has anyone ever heard of this before?  If so, an tips?  Thanks!