Latest Installment of the House Saga

Buyer sends Seller the appraisal info from Lender that says house is not worth as much as they're asking because there is some major dry-rot damage to deal with. Lender will not fund loan. Seller sits on this info for 5 days. On Friday...

Seller: OK. We'll lower the price to the appraised value. All other conditions remain the same.
Buyer: That's great. [aside: 'all other conditions' means that they are still giving us some cash back and dealing with the sewer]. Isn't this good new, Lender?
Lender: Well, actually, this doesn't solve the problem for us. We can't lend on a house that has a deficiency mentioned in the appraisal until that deficiency has been remedied.
Buyer [thinking to themselves]: WTF?! Remember, the Seller and the Buyer are the same flippin' company! [aloud to lender]: Okay, well here are a few things to think about. 1. We just talked to another lender and they have a lower rate. 2. We are planning to repair the dry-rot right away and we have the cash for that. We would be happy to put it in a special account so you could see that the repairs are done. 3. The close-o-escrow deadline is the 24th, so time is of the essence.
Lender: That's all good information. Let me run it by my boss.
Buyer: It's 4:00. Just wondering how things are going.
Buyer: It's 4:30. Just wondering if you've made any progress. Even if you haven't, could you please call us before you leave the office? Thanks.
...
still waiting...
I'm guessing he was out of the office before 4 on Friday. Hmmm. So far, there is very little to recommend these people, and if any of you readers want to know who they are, email me. I'm happy to share.
Maybe they'll come through on Monday and we'll sign then and close on Xmas Eve, but somehow that is seeming less and less likely.