House was listed by broker with 420 more square feet than actual!

[app]

I need some advice. I was set to close on 11/28, on what we considered a clean and fair deal. We made an offer on a property on October 29, 2001 that met the asking price of the seller. We were buying what we thought was a 1700 square foot, total GLA for 169,900 US Dollars, which equals approximately $99.00 per sqaure foot.


On Wednesday, November 23, we receive a call from the bank indicating the appraisal only came in for $135,000. We scurried to figure out what went wrong, how could it have come in at $35,000 lower. Well, luckily, a good friend of ours who owns an appraisal, was able to meet us immediately to do a full appraisal, per our request, to see if any mistakes were made.

He discovers, what neither the owner, the listing broker, and our broker could not discover, the property only has 1280 square feet.

Now we realize that the mortgage company is at fault for allowing the appraisal to go so long before one was done and obtained. Our broker advices us immediately that the listing agent, as part of her due dilligence to pull a field card on the property to validate size, as well she herself and they agency they represent are liable and we have a law suit.

We want the house, but we felt cornered. When all this took place, we were 4 business days away from closing, and all packed up, utilities and mail transferred, with a moving company scheduled for next friday, 11/30.

The listing broker has acted unprofessionally in several ways, with threats, allegations of discrimination, and giving the owner my cell phone number to so the owner could state her case.

We went back to the table with what we thought a fair deal. The agency and all brokers get nothing. The owner gets what she thinks is fair, and we walk away with 2.5% of the commission to pay for a roof.

Before we agree to anything, including walking away, do we have a right to sue? If so, do you know for what?

Desperate...time is ticking and we have no place to live.. :-(

 

[JETX]

First, if you close with the knowledge that you have, you forfeit all rights to sue since the closing will be viewed as acceptance of the current 'deal'.

Second, there may be some liability by the seller or their agent, but what that liability will be and how it could affect your sale are largely unknown.

My suggestion would be, rather than waste time worrying about 'maybe' and 'could-a', why not talk with an attorney NOW to determine your legal standing and to get ACCURATE advice based on the full details?? It will very probably be the best couple of hundred dollars you could spend in this transaction (and the cost might be included in your 'settlement').

 

[HomeGuru]

In addition, if the governmental source records ie. real property tax office field card or building permit records indicate the 1280 SF, then you have no case. Reason being, Court's have recently ruled that Seller's cannot be held liable for misrepresentation and improper disclosure for failing to provide Buyer with information that is public record.
The reasoning is that the Buyer and the real estate agent for the Buyer should have completed their own due diligence and if this was done, the public record facts would have been discovered prior to closing.