Cost of Condo Raised at Closing

Q: My daughter recently closed on a new condominium in Florida. The builder added $4,000 dollars to the cost of the condominium at closing for the cost of marble flooring that was accidentally installed in her bedroom during construction.
 

Marble was never authorized nor discussed, and no change orders were ever written. The specs called for builder’s standard carpeting to be installed in the bedrooms at no additional charge.

At some point in time, the builder asked my daughter if she wanted to get out of the contract because the actual square footage was calculated as exterior area by mistake. My daughter chose to go forward because this unit has appreciated almost 30 percent since she made her down payment.

Did this builder take advantage of an uneducated, poorly informed buyer?

A: It's hard to know if the builder took advantage of your daughter because you haven't included all of the circumstances of the purchase in your letter.

On the face of it, yes, it sounds like the builder might have taken advantage of your daughter.

However, if you're describing her as an "uneducated, poorly-informed buyer" (and you're her father), undoubtedly she was. And, she shouldn't have been. Buying a home is the single largest purchase she’ll ever make. She should have been much more prepared and knowledgeable. Shame on her.

But just because she was uninformed doesn't necessarily mean that she was ripped off. When did your daughter realize that the floor in her unit was marble? Surely it was before she went to the closing. Perhaps it was weeks before the closing. Didn't she walk-through the unit to do various inspections? Did she walk through before the closing?

When did she bring the marble floor mistake to the builder's attention? Did the builder agree that a mistake was made and the parties came to an agreement about payment? It's possible that the builder said to your daughter, "Well, the floor would normally cost $8,000 but I'll give it to you at my cost of $4,000" and she said yes. Or, perhaps they agreed to it in principal but he never specifically said how much he'd charge her.

However, if your daughter never knew that she was going to be charged until it showed up at the closing, and she was under duress to agree to the price, that’s a somewhat different story. She could have stopped the closing and found an attorney to negotiate the issue. Or, she could have told the builder tough luck, or tried to negotiate the price herself.

Instead, she signed the papers.

While I wouldn't say there's nothing she can do now, it's a lot tougher than if she tried to do something before the closing where she had more leverage. She could sue the builder, but if the floor is worth at least $4,000 then she got what she paid for. An attorney specializing in construction litigation could advise her of her legal options at this point.

Given the fact that your daughter was "uneducated and poorly informed," it sounds as if she ended up with a beautiful, upgraded condo that has already appreciated in value, and sounds like a lovely place to live. That's the good news.

Perhaps she can consider this a relatively inexpensive lesson about the value of being an educated and well-informed consumer.

NOTE: This column is distributed by Real Estate Matters Syndicate, PO Box 366, Glencoe, Illinois, 60022. This column may not be resold, reprinted, resyndicated or redistributed without written permission from the publisher.