My question involves real estate located in the State of: Indiana, Marion County
In 2009 we purchased our first home from a family member. We did not use a realtor, real estate attorney, nor did we have an inspection or appraisal at time of closing. It was our belief at the time, based on the sellers information & the Indiana property report card and sketch, that the square footage of the home was around 1700 sq. ft. Nowhere in our closing documents, other than the property sketch, was square footage mentioned.
Fast forward to now. We have listed our home for sale utilizing a standard listing contract with a local/national real estate brokeage and it has been on the market for 3 weeks now. At the outset, our Realtor came over, took his measurements, gave his pitch, quoted his suggested list price, and we signed the deal. We've had a showing or two and received good feedback. Tonight, while looking over the description and room dimensions of the listing on the MLS/BLC, I realized that the square footage actually adds up to 400 sq. ft. less than what we thought it should be and what is advertised in the listing. I pulled out my measuring tape and went over it twice; the actual sq. footage is 1300 sq. ft. The unfinished attached garage had been added to the livable area erroneously and recorded that way in the tax rolls since the time the home was built in the 90's. It turns out that our Realtor relied on the square footage recorded on the tax rolls just like we had and just like the previous (original) owner had.
Obviously, if we wish to continue with the listing, we Would need to correct the error in the interest of full disclosure. However, based on price per sq. ft., the asking price will likely have to be dropped by approximately $25,000. At that price, even with a full price offer, we would have to bring a Considerable amount of money to the closing table to walk away. Money we simply don't have.
So... The assessor made an error, the original owner/seller/family member missed the error, we missed the error, our current Realtor missed the error (despite having measured!). What options do we have? Is this a title insurance claim in the making ($5000 max liability only)? Can we still be bound by the listing agreement? Does the assessors office own any blame in this fiasco? We're broke and now heartbroken. Any advice will be greatly appreciated! Thank you