Environmental problems can cause major problems with real estate transactions. Here are some of the most common and how to fix them:
| Problem: Home does not have a valid tank insurance policy: What do you do when there is an “in-use” oil tank used to heat the home and the homeowner does not have a valid tank insurance policy? Realtors usually inform their clients to immediately buy a policy. However, when homeowners contact their heating oil companies to purchase insurance, they are surprised to learn about the 60-90 day “waiting period” before the policy takes effect. In many instances, this delay may jeopardize the real estate transfer. |
Solution: A tank test will reduce the tank insurance waiting period to less than 7 days! If homeowner has a tank test performed on the tank and the tank passes the evaluation, the heating oil company can issue the insurance in less than one week. |
| Problem: Home has an abandoned buried tank & no official documentation proving the tank was properly decommissioned. Should the buyer accept the seller’s assurances that the tank does not present an environmental hazard? |
Solution: The buyer should evaluate the soil surrounding the tank for petroleum contamination. Many homeowners decommissioned their buried oil tanks prior to 1990 before most towns had “official” regulations regarding underground tanks. If your buyer is purchasing a home under these circumstances, the buyer should hire a testing contractor to evaluate the soil surrounding the buried tank for contamination. If the samples do not contain petroleum contamination exceeding state action levels, the underground tank does not present an environmental hazard. In the event significant contamination exists, the tank must be properly decommissioned by a certified environmental contractor. |
| Problem: How do I choose the best testing contractor for my client? Did you know that many states do not require testing contractors to have licenses to test residential oil tanks? Most states have rigorous license and certification procedures for testing commercial tanks. However, homeowners underground tanks are not regulated by most states (New York regulates all tanks larger than 1100 gallons). This means there are no certification or licensing procedures required to test homeowners tanks. This has the effect of allowing “fly by night” operations with no tank expertise to go into the business of evaluating tanks without ever obtaining any state licenses. |
Solution: You should only recommend testing contractors that hold valid licenses and certifications for your jurisdiction. Protect your client! Testing contractors that carry licenses to test underground tanks have met extensive state quality assurance guidelines and satisfied all rigorous state requirements for testing including sufficient errors and omissions insurance. If the testing contractor’s company is not licensed by the state, chances are the company is not an expert in this field and does not have errors and omissions insurance. |
| Problem: There’s a complex tank environmental issue affecting my real estate transaction. Where can I find additional resources to answer my questions? |
Solution: Contact ATS at |
