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Buying a House with an Oil Tank in 2021

Heating oil tank being lifted by an excavator

So, you’re buying a house with an oil tank and you’ve got question. Well, you came to the right place.

What to Know When Buying a House with an Oil Tank

First and foremost, if you are buying or selling a house and the heating oil tank is underground, do NOT waste money on a tank test OR a soil sample. Why is that you ask? Well, I’ll tell you. Most residential buried oil tanks in Maryland are much older than 20 years – the lifespan of a tank. Spending money to test something that is double or triple its useful lifespan, something that needs to be removed anyway, is a waste. A tank test or soil test will NOT tell you with 100% certainty if the tank is leaking or not. Nor does it give you a guarantee of how much longer it will last. GreenTRAX has pulled tanks that have recently passed tank tests and found that they have been leaking badly. We have also removed tanks that have failed tank tests and the soil has been clean.

underground tank removal

A soil test is only slightly more useful but still doesn’t save you any money on the back end later. If the soil is tested and it is checked in an area where the oil delivery driver spilled a little bit of oil every time they filled the tank the test will show a leak when there is not a leak. Or if only one end of the tank is checked and the soil shows clean, BUT the leak is on the other end of the tank then you will get a false negative.

Legal Requirements

The other important thing to know is that if you proceed with a tank or soil test and it fails, then the Maryland Department of the Environment (MDE) has to be notified. Then tank is supposed to be pumped out right away. Not only is it now costing more money to have the tank pumped right away, then a new tank or a temporary tank or drum will need to be installed so the property still has heat or hot water.

This whole process ends up costing more money than if you just removed the tank in the first place. Also if you are the buyer and you fail the seller’s tank test then, yes, the seller will have to deal with it. BUT we have seen it where the seller was not aware this could happen. Needles to say, they were NOT very happy at all once this happened. So they decided to cancel the contract with that buyer and accept another offer.

“OK I got that GreenTRAX. So what else do I need to know if I’m buying a house with an oil tank?”

The MDE REQUIRES that if the buried tank is no longer in use, it CANNOT remain in-place as-is. It must be removed or properly abandoned in-place by a LICENSED TANK REMOVAL contractor. If you have a tank that is buried and has not been used in many years, it is out of compliance and against code. Normally this falls back to the seller to have to deal with BEFORE settlement.

Underground Oil Tank Removal

So even in this crazy housing market we are in, in 2021, with the sellers having more power. But due to the environmental liability, buried oil tanks can & do still fall back as the seller’s responsibility. WHY is that??? Well, we see frequently, even up to a few days BEFORE settlement that the BUYERS Mortgage company, bank, lender, OR home insurance company CAN and DOES still PREVENT a buyer from going to settlement on a property with an old buried oil tank. We have been in the oil tank business for almost 30 years, so we have seen and done it all. Let us help you and learn from our experience.

What are some other things I need to know?

Facts About Residential Oil Tanks

  • No one ever knows if their tank is leaking or not just by their oil usage or by stick-testing the tank regularly.
  • Do not rely only on your real estate agent or home inspector to catch that there is a buried oil tank on the property, as they may have not dealt with it before they may not know how best to advise you.
  • If the seller says they had the tank properly dealt with BUT they don’t have any paperwork, do not believe it. Without paperwork and a closure packet, it probably isn’t true.
  • Any tank removal or abandonment in Maryland MUST include soil samples tested at a lab to prove the soil below the tank is clean.
  • Just because the tank is close to the foundation doesn’t mean it cannot be removed. Most tanks are close to house foundations, and we remove them all the time.
  • The MDE has a reimbursement program to pay back the person who pays for the tank removal and leak remediation. They cover all out-of-pocket costs except $500.
  • If the residential tank has leaked, NO, it does NOT costs tens of thousands of dollars to clean up. Most residential cleanup jobs are less than $10,000 and some are less than $5,000.
  • Don’t just try to do a bunch of research online about this whole process, Call GreenTRAX. We are the best in Maryland and are here to help you and answer your questions and inform you about the process. Call today 410-439-1085.
  • Yes, the oil tank can be filled in-place, BUT it has to be done by an MDE licensed contractor (GreenTRAX). And then digging still has to be done to get to the tank.
  • It is NOT legal to dump sand in the fill pipe and leave the tank.

But Wait, There’s More!

  • It is always cheaper to remove the tank instead of properly abandoning it in-place
  • Most people’s home insurance does NOT cover leaking oil tanks.
  • If there is a buried GASOLINE tank on the property and you have a drinking water well on the property, the tank should be removed as soon as possible. If the gas tank leaks, it has a higher chance of contaminating the well water.
  • Leaking oil tanks can also contaminate well water, but chances are lower.
  • Leaking buried oil tanks have the possibility of contaminating the drain tile around your foundation and sump pump basin in the basement.
  • A tank removal is NOT a major undertaking, in fact if the tank is clean and not leaking the onsite portion of work can be done in as little as 2 hours. (by professionals like GreenTRAX, of course)
  • Do not try to hide the fact there is an oil tank onsite – we have seen that come back to bite people very badly.
  • Do not believe people if they tell you, “We didn’t have to follow the rules for tanks because this is how we dealt with it 20 years ago.” NO. 20 years ago was 2001, the same rules applied then as today.

So these are just some of the things you should be aware of, call the professionals at GreenTRAX and let us help you through the process. 410-439-1085

(while we want to help everyone, we only service the State of Maryland at this time)

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More To Explore

The Maryland Department of the Environment is cancelling the reimbursement fund for homeowners with leaking heating oil tanks!

This cancellation takes effect June 30th, 2024. You need to have your buried oil tank removed NOW, so if the tank is leaking you can get reimbursed for remediation costs before the program goes away. Click here for more information on the reimbursement fund as it operates now.

We urge everyone to contact their representatives in Annapolis and the Governors office and tell them DO NOT cancel the homeowner reimbursement fund for leaking residential oil tanks! They can still renew this program before this year’s legislative session ends.

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