Before we address this question more directly, we need to define an important term. When we say “UST” we mean “Underground storage tank”. We’ll be using this term a lot, so now that you know what we mean, let’s get started on some important facts about underground tanks.
If you are looking at selling a property with a UST that is no longer in use it MUST be properly removed or abandoned by an MDE licensed company (such as GreenTRAX, Inc), prior to settlement. This is one of the most important things that you may need to know as a realtor.
Here are some other quick facts about USTs that can help you on the job.
- Average life of underground tanks is 20 years.
- Unless there is documented proof the tank is less than 20 years old, it is most likely much older than that and needs to be dealt with prior to being sold.
- It is becoming more and more difficult to sell a house with an old UST.
- There are many sizes of USTs typically found at residential properties such as 275, 300, 550 and a 1000 gallon.
- It is better for all parties to REMOVE the tank instead of ABANDONING the underground tanks.
- It is usually always CHEAPER to REMOVE the tank instead of ABANDONING underground storage tanks
- Many banks, mortgage companies and home insurance companies will not allow the buyer to settle on a house until the UST is properly taken care of and prove there is no contaminated soil left behind.
- If there is contaminated soil to remove, the property owner can be reimbursed for the out of pocket costs from the MDE HRF (home owner reimbursement fund).
- USTs should NOT be considered part of normal buyer beware inspection process, it is always in the best interest of the home sale transaction for the SELLER to take care of the tank properly BEFORE listing the house or prior to settlement.
- You need a full closure report prior to or at settlement. Report includes pictures of tank removal, soil sample analysis from a lab, a write up of what was done, and much more.
- Every owner always says “my tank is NOT leaking” in reality they never know if they are going through oil faster due to a leak, they only realize it in extreme cases where oil is delivered 1 day and 2 days later tank is empty.
- It is a waste of money to test USTs that are OVER 20 years old, it is NOT the buyers responsibility to spends upwards of $600 to test an old UST that just needs to be removed anyway.
- You don’t want to find out 72 hours before settlement that the buyers cannot settle on the property until the tank is removed.
- USTs must be disclosed to buyers.
- If UST is older than 20 years, recommend to the seller it be removed. Ie. What would you recommend to the client if their roof was 50 years old but shingle was rated for 20 years?
The tank should be removed well before the house is listed and or goes to settlement. Here is one scenario we have seen more than once in our OVER 25 years in the tank business. The house has a UST, the house is under contract, and the buyers require tank be removed before settlement. GreenTRAX removes the tank without issue but finds the tank has leaked. It is a bad leak and GreenTRAX removes contaminated soil. However it is also found that oil has made its way into the sump pump basin in the basement OR the potable water well has been contaminated with oil and the MDE requires additional work to take place and this carries over till after the buyer has taken possession.
Or the tank has leaked, GreenTRAX removes contaminated soil, but due to site circumstances, we are unable to remove all of the contamination to a depth sufficient to clean it up to satisfy the MDE, and then MDE requires a subsurface investigation. (This process is fairly simple) However the length of this process will drag on for months and months, the seller will have to put a large amount of money in escrow to cover the potential costs and the buyer still has to deal with work being done on the property after they take possession.
So bottom line is don’t let an old UST derail your home sale transaction, Call GreenTRAX , Inc. to help you.