I've seen appraisers reduce the appraised value by the seller credit.

For a more accurate valuation, I’d recommend reaching out to a local realtor or hiring a professional appraiser.

We did the appraisal, we got the lawyer, and everything was set.

Meanwhile, the assets lack fundamentals, and rarely trade for remotely close to where they appraise.

Then they get the appraisal done, and the ARV looks too low, so they have to cut leverage to the 70% LTV loan amount. 

We did the appraisal, got the lawyer, and everything was set.

The entire premise of this plan relies on the appraised value of a duplex, and how much $150k gets you in your market.

There was one recently posted on BP that appraiser gave less than $40k valuation.  

I considered ordering the lender's inspection/appraisal, but this wasn't an option because the water and electricity are currently turned off, and HUD won't turn them back on until I have submitted earnest money of $2,000.

Since this is an FHA Streamline, there is no appraisal, no income verification, no employment verification, no out-of-pocket costs, and nothing rolled into the new loan.