My house is under contract, the buyer now insists that I pay for the appraisal because he did not know that my house was a double wide, even though it was stated on the prop info worksheet. He is threatning to "sue us" or ask for a reduction in amount he wants to pay.
the house will probably not appraise for asking price, but he signed the contract and put a 5% deposit down. Can he legally make us pay for the appraisal? I think he knows it will not appraise for asking price and is trying to get out of contract without laying out any money.

Not sure of the laws in your state but usually an appraisal is required by the lender and paid in the closing costs. If you agreed to pay the buyers closing costs, then who ever does the appraisal should be paid when the deal closes. If it was disclosed as a doublewide and he didnt pay any attention, thats his problem. If the trailer wont appraise for the purchase price and he is not a cash buyer he wont be able to get financing from any lender and that is reason to legally back out of the deal, and get his deposit back. Just because you wont pay for a appraisal on his behalf is no reason for you to have to pony up the 5% deposit, but i dont see how he can make you legally pay for an appraisal. To sum it up, if he backs out before the appraisal is done then you should be able to keep the deposit. If he gets the appraisal and the lender denies him the financing, you will most likely have to give him his deposit back.