During the due diligence period the appraiser found out that there was 600 sqrft of space not shown on the tax records.

If anything you may consider an appraisal gap instead of waiving financing contingency.

COC 1.28% and then COC after tax: 3.2%. this is a single family home, and even though knowing the cap rate is kinda cool, its a residential home and the value is based on fair market AKA appraisal so cap rate is not warranted. 

@Pete Perez A lot of this could depend on the appraisal.

I’m worried about the appraisal not approving the 3rd home that needs work, and hoping a desktop appraisal would be ordered but not sure because it’s a unique property.  

It's a good background for a realtor, and an almost perfect background for an appraiser.

Hi Everyone,First time posting here, but I was wondering how lenders choose their appraisers.

It didn't appraise and it killed the deal.

I don't have crazy high interest debt I would pay off with it or anything like that, but it seems wise to go ahead and secure the line of credit while homes are appraising so high.

I would say pay close attention to the volume of comps wherever you end up...some of these transitional locations have many more $125k properties than $350k properties...combine this with lack of experienced appraisers and you have a potential recipe for disaster.