This happens a lot, which is one argument for applying for two parrallel loans. Then, when closing time approaches, they can’t pull costly surprises like this. You can bolt.
They knew they had you in a bind and had to go forward. You had no negotiating leverage. Yes, it costs extra to have such backup…I believe just the cost of another appraisal.
Any other Piggs ever try this? I have not, but have seen it advocated.