Marshall, You are correct.

I've had a really hard time finding contractors to even get bids and that is through Thumbtack and Home Depot, they are all super busy.

His bid was fair and then further reduced because I allowed him to stay at the property during the rehab.

An algorithm doesn't have the correct inputs to make a decent valuation. 

I won the bid at $75,235 and there wasnt much wrong with the house only a few minor repairs before it was move in ready.

If you did this and either held it for a year (I️ believe that is the standard, but I️ would confirm with the banking institutions you want to go with), you could then refinance, pay off your land contract and pull cash out if appraisal came back higher.Your original thought process is correct in that a bank wants the 20% (I’ve seen closer to 25-30% on commercial loans until you build relationship) to protect themselves from fluctuations in value, but they also want skin in the game.Good luck,Roger

What's the correct way to do this? 

I am a 3D artist, creating motion graphics for game day events and renderings for project bids on LED displays. 

If I'm reading you right, you have a fully executed contract in which the seller agrees to pay for certain expenses / repairs, and is now refusing to pay for them.I'm also presuming that the $20K reduction was within the contractually allowed due diligence period and was agreed to by the seller within that same period.If that's correct, the seller is in breach of contract.Your attorney should contact the seller and give them the option of performing to the contract or being sued for "specific performance".  

See how nice and helpful people can be when the situation is correctly stated :) @John Andruszka   SO Ya your next step is post pay or quit then file for non-payment, eviction, she's not gonna pay you a dime. is my bet and I bet I'd win that bet..You have no guarantee she'll pay rent, you've given her 2+ extra weeks to move..