Buying or selling a home with an oil tank? Whether you’re a buyer, seller, or real estate agent, understanding how to properly handle underground and aboveground heating oil tanks is crucial. From legal requirements to mortgage and insurance concerns, failing to address an oil tank can cause major delays and unexpected expenses. This guide will help you navigate oil tank issues to ensure a smooth real estate transaction.
Heating Oil Tanks in the Basement
Q: What should be done about the heating oil tank in the basement?
A: If it’s no longer in use, it must be properly removed. If it is still in use and is 20 years old or less, it is generally safe to continue using it.
Aboveground Heating Oil Tanks in the Yard
Q: What should we do with an aboveground heating oil tank outside?
A: If it’s no longer connected to the heating system, call GreenTrax for professional removal. If it is still in use but its age is unknown, call GreenTrax for a consultation and possible replacement.
Fuel Tank Lifespan
Q: How long does a fuel tank last?
A: 20 years. If you’re unsure of the age of an aboveground tank, call us. 99% of all buried residential heating oil tanks in Maryland are older than 20 years. Contact GreenTrax to evaluate your tank.
Mortgage Requirements for Tank Removal
Q: Can a home buyer’s bank or mortgage company require the underground tank to be removed or abandoned before settlement?
A: Yes! This is a common requirement. Underground tanks should be addressed well before settlement to prevent closing delays.
Home Insurance and Underground Tanks
Q: Can the buyer’s home insurance company require the underground storage tank (UST) to be removed or closed before the home sale?
A: Yes. Some insurance companies have strict policies against underground tanks. GreenTrax frequently encounters cases where insurance companies delay or prevent closings due to USTs.
Maryland Law on Buried Fuel Tanks
Q: Does Maryland law require buried fuel tanks to be removed before a home sale?
A: If the tank is no longer in use, yes. Maryland law mandates that any unused UST must be properly removed or closed in place by a licensed tank removal contractor such as GreenTrax.
Buyer’s Agent Responsibilities
Q: Should a buyer’s agent allow closing on a house with a buried tank?
A: No! Buried tanks should be dealt with by the seller before closing.
Listing Agent Best Practices
Q: Should a listing agent disclose a UST and leave it?
A: No! Timing is critical. Delays due to oil tanks, leaks, and remediation can prevent closing. Have the seller call GreenTrax before listing the house to properly address the UST.
Seller Credit for Tank Removal
Q: Should the seller credit the buyer for tank removal?
A: You can, but you shouldn’t. The buyer will then bear the cost upfront, and if the tank is leaking, additional expenses can pile up, including contamination cleanup. It’s best for the seller to handle the removal before closing.
Removal vs. Abandonment of Buried Oil Tanks
Q: Should a buried oil tank be removed or abandoned?
A: Removal is generally better, but if the tank is clean and not leaking, either option works. However, even for abandonment, Maryland law requires the tank to be cut open and cleaned. If a company suggests filling the tank without opening it, they are not following legal procedures—this can cause major issues later.
Well Water and Underground Tanks
Q: How does well water relate to underground storage tanks?
A: If the oil tank is leaking, the Maryland Department of the Environment (MDE) requires a well water test. If petroleum traces are found, further testing will be mandated over a longer period.
Follow-up Q: Doesn’t my well water company test for oil?
A: No. Normal well tests do not include petroleum testing. Additionally, the well company’s tests do not meet MDE’s requirements. If testing is necessary, GreenTrax will take the appropriate samples.
Additional Issues with Buried Tanks
Q: What other issues can arise from a buried tank?
A: If the tank is leaking, MDE will require its removal to extract contaminated soil. This process can incur additional costs.
Follow-up Q: Is soil removal the only concern?
A: Not necessarily. If contamination is severe, deeper excavation may be required, adding cost and time—sometimes weeks or months.
Follow-up Q: How does a leaking tank affect well water?
A: If petroleum is detected in the well, additional testing may be required for up to a year.
Follow-up Q: Can oil contamination reach the house?
A: Yes. In rare cases, oil can seep into French drains, sump pumps, or even through basement walls, causing significant foundation issues.
Tank Removal Near the House
Q: Can a tank close to the house still be removed?
A: Yes. Most tanks are near the house. Digging near the foundation does not compromise structural integrity.
Installing a New Aboveground Tank
Q: Can you install a new aboveground tank after removal?
A: Absolutely! GreenTrax installs new tanks and can transfer the good oil from the old tank to the new one. We remove sludge and offer tanks with warranties of up to 30 years.
Buying a Home with an Underground Tank
Q: Should a buyer walk away if the seller refuses to remove the tank?
A: Not necessarily. If you love the house and can afford the tank work, it is not a dealbreaker. Even if the tank is leaking, it will not cost $100K to fix. GreenTrax can help ensure the process is handled correctly.
Final Thoughts
Addressing oil tanks in real estate transactions is crucial for avoiding delays, financial risks, and environmental hazards. Whether you are a buyer, seller, or agent, taking proactive steps with GreenTrax can make all the difference. Don’t wait until the last minute—contact GreenTrax today!
