I applied for a loan with USBank, for an investment property, a REO home, owned by another national bank. I already have a mortgage with USBank on my current home so I thought they would be easy to work with and they 'd sent mailers hinting at deals for current customers on additional mortgage opportunities. I had previously attempted to get a mortgage with another lender, who, within a few short days of application, informed me that they could not loan because there was no AC unit in the property ( the property was a foreclosure that was stripped of most appliances ). I told the USBank loan personnel this matter, and expressed concern that I wanted to be sure I could get a loan on the property. My other option would have been to refi my current USBank mortgage to take out equity and buy with cash, but their rates seemed good and the loan officer told me she checked and underwriting had no problem with the AC being missing but approval would depend if safety issues were listed in appraisal report. I went ahead with the process. An appraisal report was provided to me dated XX/XX/XXXX, yet it was not until XX/XX/XXXX that I was told USBank would not be able to underwrite the mortggage unless and until repairs were made as per the appraisal report. However, the appraisal report mentioned items as " marketability '' not safety concerns. They wanted flooring repaired, an AC unit installed, and a door put on the attic opening. We are trying to get a conventional loan, for {$48000.00}. This is a XXXX % down situation, and conventional. I did n't think so many stipulations would be needed. The appraisal report was for {$72000.00}, with estimated repairs at {$5000.00}. I told USBank we intend to make even more extensive repairs after closing. Our contract and addendums stated this property is AS IS. There are no repairs allowable prior to closing. 
I have been told that I may consider making repairs on my own cost prior to closing to meet the loan requirements. However, this is terrible advice, as if anything goes wrong, I 'd be out a significant amount of money. Additionally, this is not allowed in the contract by the seller, as USBank knows. 
I was told that USBank is stuck with whatever the appraiser is requesting. However, one option on the appraisal report is for AS IS. The appraiser did not appraise this way, even though he had the contract which shows it 's a REO property and AS IS. I attempted contact of appraiser and was unable to reach by phone or email provided on the report. 
I would like USBank to provide the loan on the property. Their risk is low, as they already have a good payment history from almost 5 years of payments on my current home ; additionally we are asking for just over XXXX % of the appraised value ( after repairs taken into account ) for this loan ; thus they will have a significant amount of wiggle room should we default immediately after closing. 
I feel they are doing a bait and switch effort here to try and get me to refinance my current, high mortgage with them and pay even more fees than this small new mortgage would run. If they are unable to provide this loan immediately I will have to seek another lender to handle this.