Ameer Randolph
Underground fuel tanks can pose a significant risk to homeowners due to the potential for leaks, corrosion, and improper abandonment, which can lead to costly soil and groundwater contamination. When purchasing a property, it is crucial for buyers to conduct due diligence by hiring a licensed contractor to perform a tank sweep and assess the presence and condition of any underground tanks. While some buyers may choose to walk away from a property with an underground tank, others use it as a negotiating tool, often including tank removal as part of the terms of their offer. Ultimately, the responsibility for removing the tank typically falls on the seller, who must comply with strict regulations and obtain the necessary permits for proper disposal.
| Characteristics | Values |
|---|---|
| Responsibility for removing underground fuel tank | It depends on the agreement between the buyer and seller. The buyer may request the seller to take on the responsibility of removing the tank and completing any necessary cleanup before the closing of the sale. |
| Role of the buyer | The buyer should perform due diligence on the property, including a preliminary site assessment or tank sweep to detect the presence of an underground storage tank (UST). The buyer is generally responsible for the cost of all inspections. |
| Role of the seller | The seller should comply with regulations and obtain required permits for tank removal and soil remediation. They should also provide proper documentation, including environmental clearances, before finalizing the transaction. |
| Costs | The removal cost of a residential underground oil tank ranges from $1,000 to $2,500 depending on size. The buyer may negotiate for the seller to pay for a portion of the additional testing or removal costs. |
| Environmental impact | Leaking underground tanks can contaminate soil and groundwater, leading to significant cleanup costs. The responsible party is required to compensate third parties for injury and property damage caused by leaking tanks. |
| Regulations | Federal UST regulations apply to UST systems storing petroleum or certain hazardous substances. State regulations may also apply, and proper environmental assessments and closure procedures must be followed. |
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What You'll Learn
- Buyers should hire a licensed contractor to perform a tank sweep to detect the presence of an underground storage tank
- Buyers can request sellers to take responsibility for removing the tank and completing necessary cleanups before closing the sale
- Underground storage tanks must be permanently closed or removed after fulfilling their intended use
- Buyers should not close the deal without an NFA letter in hand, which can take 4-6 weeks from tank removal
- Buyers should be aware of the risks associated with underground fuel tanks, including leaks, corrosion, and improper abandonment, which can lead to costly cleanups
Buyers should hire a licensed contractor to perform a tank sweep to detect the presence of an underground storage tank
When purchasing a property, it is important to conduct thorough due diligence to avoid future liabilities. A common issue that home inspections identify is an underground fuel storage tank. These tanks, if not properly removed, can lead to environmental contamination and costly remediation work. Therefore, buyers should hire a licensed contractor to perform a tank sweep to detect the presence of any underground storage tanks (USTs) before finalising the purchase.
A tank sweep involves the use of metal detection equipment and visual observations of the property, both interior and exterior. A technician will look for evidence of a tank, such as fuel lines, vent pipes, depressions in the yard, patchwork indicating previous lines or piping, and areas of dead grass or landscaping caused by spillage. This process helps determine the possibility of a UST on the property. Reputable companies usually offer assistance in removing the tank at their cost or at a discounted rate if it was missed during the initial sweep.
If a metallic object is detected during the tank sweep, further testing is recommended to determine its size, shape, and whether it is consistent with an underground oil storage tank. Buyers can request additional tests, such as heightened metal detection or ground-penetrating radar, to better identify the object. An exploratory dig may also be performed, where the contractor digs out the area by hand to locate and identify the object. It is important to obtain the seller's permission before conducting any additional testing.
In some cases, underground tanks may have been decommissioned in place, meaning they were pumped out and filled with sand. However, these tanks should still be properly removed as they pose a risk of uncertainty and potential environmental contamination. Buyers should also review local and state records to check for any history of remediation work, contamination, or environmental issues associated with the property. This information can be valuable during negotiations and help protect buyers from future liabilities.
The cost of removing an underground storage tank is generally predictable and not the primary concern. The more critical issue is whether the tank has leaked and contaminated the surrounding soil, as remediation work can be expensive. By hiring a licensed contractor to perform a tank sweep, buyers can make informed decisions, negotiate with sellers during the inspection phase, and protect themselves from potential environmental and financial risks associated with underground fuel tanks.
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Buyers can request sellers to take responsibility for removing the tank and completing necessary cleanups before closing the sale
Underground fuel tanks can pose a serious environmental risk if not properly decommissioned or removed. Leaks and corrosion can lead to soil and groundwater contamination, which can result in significant cleanup costs. In the US, underground storage tank (UST) regulations require that UST owners and operators follow specific processes for removal and are held financially responsible for taking corrective actions and compensating third parties for injury and property damage caused by leaking tanks.
As a buyer, it is essential to perform due diligence on the property you are purchasing, including inspecting for the presence of a UST. This can be done by hiring a licensed contractor to perform a tank sweep, which may involve metal detection and visual observations of the property. If a UST is present, it is advisable to negotiate for the seller to take responsibility for its removal and any necessary cleanup before closing the sale. This ensures that the seller complies with local regulations and obtains the necessary permits for tank removal and soil remediation.
In some cases, buyers may choose to include the removal of the underground tank as part of the terms of their offer. This can help expedite the real estate transaction and remove the UST record from the state's database. The removal cost of a residential underground oil tank typically ranges from $1,000 to $2,500, depending on its size.
It is important to note that if you choose to remove the tank after purchasing the property, you will be responsible for returning the yard to its original condition. This includes properly securing the area around the excavation zone and ensuring that any contamination is reported to the relevant authorities within the prescribed timeframe.
By requesting that the seller take responsibility for removing the tank and completing necessary cleanups before closing the sale, buyers can protect themselves from future liability and ensure a smooth transaction.
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Underground storage tanks must be permanently closed or removed after fulfilling their intended use
Underground storage tanks (USTs) are used to store petroleum or other hazardous substances. They are typically found in residential, commercial, and airport settings. In the past, USTs were commonly used for heating and fuel storage in homes, but today they are largely recognised as an environmental hazard due to the risk of leaks and soil contamination.
USTs must be permanently closed or removed after fulfilling their intended use. This is a requirement by state and federal regulations, which mandate that specific processes are followed for removal. USTs cannot be left abandoned indefinitely, and proper environmental assessments and closure procedures must be conducted. The tank owner or operator is responsible for ensuring compliance with these regulations.
As a buyer, it is important to perform due diligence and inspect the property for the presence of a UST. A licensed contractor can be hired to perform a tank sweep, using metal detection equipment and visual observations to determine if a UST is underground. This step is crucial, as many homeowners do not take responsibility for leaking tanks, and the cost of cleanup can be significant.
If a UST is discovered on the property, it is recommended to negotiate with the seller to take responsibility for its removal and any necessary cleanup before the closing of the sale. In some cases, the buyer may choose to include the removal of the UST as part of the terms of their offer. The removal cost for a residential UST typically ranges from $1,000 to $2,500, depending on its size.
Proper procedures must be followed during the removal process to ensure safety and compliance with regulations. All product, including sludge and debris, must be removed from the tank system before it is excavated. The tank system must also be inerted to remove flammable vapours and monitored for hazardous conditions throughout the removal process. Once the tank is removed, it must be cleaned, decommissioned, and transported away from the site.
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Buyers should not close the deal without an NFA letter in hand, which can take 4-6 weeks from tank removal
Underground oil tanks are a critical factor that should not be overlooked when buying a new home. These tanks can pose significant problems and potential hazards, such as leaks, corrosion, and improper abandonment, which can lead to soil and groundwater contamination and result in costly cleanups. As a buyer, it is essential to perform due diligence and inspect the property for the presence of an abandoned underground storage tank (UST). This can be done by hiring a licensed contractor to perform a tank sweep using metal detection equipment and visual observations.
If you are considering buying a property with an underground oil tank, it is important to understand the risks and your options. Most buyers choose to walk away from such properties due to the potential liability. However, the presence of an underground oil tank can also be used as a negotiating tool. You can request the seller to take responsibility for removing the tank and completing any necessary cleanup before the closing. In New Jersey, for example, sellers are required to comply with strict regulations governing underground tanks and obtain the necessary permits for removal and remediation.
Before negotiating, it is crucial to understand the scope of the project and your liability. The removal cost of a residential underground oil tank can range from $1,000 to $2,500, depending on its size. Additionally, you should be aware that you will also be responsible for restoring the yard to its previous condition after the removal process. This includes properly securing the area around the excavation zone to prevent any accidents.
To protect yourself from future liability, it is recommended to not close the deal without an NFA letter in hand. The NFA (No Further Action) letter confirms that the underground tank has been properly removed and that no further action is required. Obtaining this letter can take 4-6 weeks from tank removal, but it is crucial to ensure a smooth and efficient transaction. If problems are discovered during the removal or remediation process, such as groundwater contamination or damage to neighbouring properties, the process can be significantly delayed. Therefore, it is in the best interest of both the buyer and seller to act swiftly and address any UST-related issues.
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Buyers should be aware of the risks associated with underground fuel tanks, including leaks, corrosion, and improper abandonment, which can lead to costly cleanups
Underground fuel tanks can pose significant risks to buyers, and it is crucial to be aware of these hazards before purchasing a property. These tanks, once commonly used for heating and fuel storage, can cause soil and groundwater contamination if not properly maintained or removed. Leaks, corrosion, and improper abandonment are some of the issues that can lead to costly cleanups and environmental damage.
As a buyer, it is essential to conduct thorough due diligence on the property, including inspecting for the presence of abandoned underground storage tanks (USTs). Hiring a licensed contractor to perform a tank sweep is the first step. They will use metal detection equipment and visual observations to determine the likelihood of a UST on the property. Signs such as fuel lines, vent pipes, depressions in the yard, patchwork, and dead grass or landscaping can indicate the presence of a UST or a potential leak.
The risks associated with underground fuel tanks are significant. Leaks can contaminate soil and groundwater, leading to costly cleanup processes that can drag on for months or even years. Corrosion can compromise the integrity of the tank, leading to leaks and further environmental damage. Improper abandonment, such as failing to remove the tank or leaving piping in place, can also result in contamination and costly remediation.
To protect yourself as a buyer, it is recommended to include the removal of the underground tank as part of the terms of your offer. This can help expedite the real estate transaction and ensure that the UST record is removed from the state's database. Additionally, you can pursue insurance options, such as ProGuard, which allow you to remove the tank after a year as long as it is not leaking. Obtaining an NFA letter is also crucial before closing the deal.
In some cases, you may be able to negotiate for the seller to take responsibility for removing the tank and completing any necessary cleanup. It is important to ensure they comply with local regulations and obtain the required permits for tank removal and soil remediation. Certified environmental contractors are well-versed in these requirements and can help ensure accurate information and compliance with environmental regulations. Remember that you may also be responsible for returning the yard to its original condition after any excavation or removal work.
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Frequently asked questions
Underground fuel tanks can pose environmental risks. Leaks, corrosion, and improper abandonment can lead to soil and groundwater contamination, resulting in significant cleanup costs.
A buyer should always perform due diligence and hire a licensed contractor to perform a tank sweep as part of their inspections. This involves using metal detection equipment and making visual observations to determine the presence of a tank.
The buyer can negotiate for the seller to take responsibility for removing the tank and completing any necessary cleanup before the closing of the sale.
The buyer can walk away from the deal. Alternatively, the buyer can include the removal of the underground tank as part of the terms of their offer, or pursue the seller in court to recuperate cleanup expenses, but they must prove the seller was deceptive.
Signs include fuel lines or vent pipes protruding from the ground or entering the home, depressions in the yard, patchwork indicating removed lines or piping, and areas of dead grass or landscaping caused by spillage from a fill pipe or an active oil leak.
