Is this possible?

Three years ago i got a cash out refinance to pay bad credit cards, and medical bills. I got 62k for all of this. In exchanged i got a arm and this last year it adjusted to 14%. i am stuck i tried to refinance and found out that i am upside down by 70k. I took it to my relitor that sold my house and he discovered they inflated the appraisal by 50k and showed my income as double. He refered me to a lawer, this lawer looked at it and said there is a good case. My lawyer has been working on this for a few weeks, he called me tonight with some good news. He had a confrense call with the mortgage companies executives/lawyers today and they agreed to refinance the home on todays appraised value, the diffrence i am upside down they are going to eat the diffrence. I am supppose to go see my lawyer tommrow on this. Anyone ever hear of this.