That jives with what the bank was saying. I guess I wasn't aware that
a appraisal was debatable... I guess that does make sense, it is the
banks money. The property DID appraise for $15,000 over the sale price,
so I thought that was a Good Thing.

Actually it is a Good Thing - because if the appraisal was less than the
sale price you might have to come up with more money to put down depending
on what you want your payments to be. Banks usually will not lend more than
80% of the appraisal value so the higher the appraisal the better.

When I originally sat down with the lender I was told to lock in at a
rate with zero points I would have to put money down. I put $1000
down. That was the bait. Two weeks later they inform me that they
'forgot' that Freddie Mac charges 1 point on multi-unit homes. That
was switch number 1.

Whate does the paperwork that you signed when you "locked in" state? Read
the fine print carefully -- it probably mentions something somewhere about
points -- if it does and you signed it then it's not bait and switch it's
more that you were excited about the rate and signed whatever the bank told
you to sign without reading all the fine print. If it doesn't say anything
about the points - ask the bank to show you where in writing it states that
points may be required.

And then just recently they inform me that they
'don't like' the appraisal so they can't give me the 30yr fixed - and
then in the same conversation offer me an ARM at TODAYS rates. That
was switch number 2. Now if I want to go to another lender I am
screwed because the rates have gone up so quickly. What was the point
of locking in at rate??

Didn't they give you an approval? When I locked into my mortgage I was told
that I had to provide them with certain documentation - then I had to give
them a deposit and sign the papers to lock the rate for 90 days -- they had
3 days to review all my papers and then I was "cleared" for the rate I
locked into - if I turned back after this period I forfeited my deposit
however if after the 3 days for some reason they felt that they could not
give me the rate I locked at for whatever reason (i.e. my documents didn't
show I had enough for a downpayment or I didn't make enough, etc) they would
refund my deposit. I received a letter in the mail stating that the
documents were reviewed and they were accepting my application as agreed to
in writing on the day I signed the contract. Of course, until closing they
kept asking for more and more records, etc.


The reason I am upset is that I feel like I was intentionally deceived.

Probably not -- probably just being a bit inexperience you took everything
at face value and believed what was told rather than reading every single
word and fine print on the documents. Not totally right by the bank for
not explaining the fine print, but that's why it's there -- they want to get
your business and of course only tell you what is attractive.