Q: We are buying a home and are set to close in a week. The home was appraised by the mortgage lender’s appraiser and the appraisal shows the gross living area is about 4 percent less than advertised in the listing sheet. The listing sheet square footage is the same as listed on the tax assessor’s rolls.
We are thinking of asking the seller to reduce the sales price because the home is actually smaller than advertised. Is this a legitimate request? If the sellers refuse to reduce the price, can we walk away from the deal and get our earnest money back?
A: Let’s think this through for a moment: Did you buy this house because you think the square footage is supposed to be a certain amount? In other words, did you go searching for a 2,500 square foot house? Or, did you feel that the house met your needs as is?
Let me put it another way: If square footage on the appraisal had come in higher than the square footage listed on the listing sheet, would you have offered to pay more? I don’t think so.
I don’t think this is a legitimate request. You’re buying a house, and there are many ways to calculate the square footage of the property. You can calculate it from the outside walls, or you can measure the internal square footage of each room. Each of these ways of measuring square footage is accepted in different arenas.
It’s also possible that the appraiser made a mathematical mistake.
If you walk away from the deal, the sellers may be able to keep your down payment and, depending on the term of your contract, may be able to sue you for even more.
You should speak with a real estate attorney who can walk you through the contract you signed, explain the various ways square footage can calculated, and discuss your options with you.
You may also find that unless you specifically required the seller in your contract to deliver to you a home of at least a certain number of square feet with a method of computing that square footage, you’ll be out of luck if you want to kill the deal because of that issue.
Another reader had the same experience when buying a home and finding that the square footage was off.
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