Abandoned oil tank? (homeowners insurance, buying a home, water heater)

[jonandcarrie]

We're buying a home in NJ but our home inspection this week brought up the possibility of an abandoned underground tank. The furnace is still oil and there's a tank in the basement, but there's another line (see pic below) coming up from the concrete floor that's not connected to anything. We didn't see any vents or fill pipes in the yard except for the ones that service the visible basement tank, and we can't figure out where this one leads to - no evidence of the line going through the foundation. The house is about 80 years old.

We're checking with the homeowner to find out if they know anything about an underground tank, and will be having a family friend with pro equipment sweep the yard anyway, but thought we'd see if anyone here had an opinion. It's nerve wracking not knowing!

[BobKovacs]

It definitely should be nerve-wracking- if you buy it, you own it. If the tank wasn't properly remediated and there's a leak that contaminated the soil, you can be on the hook for a huge bill for remediation. I'd definitely want to have the yard checked for evidence of a tank, and if you find one, make the owner remove it and remediate any contaminated soil.

[jonandcarrie]

Thanks Bob, that is definitely solid advice.

I've also been reading through this thread, which anyone facing a similar situation should definitely review: Underground Storage Tank Information

[Diane Giam]

Run away if there is any posibility at all. You don't know the stress it can cause you. Also its not covered by insurance anymore. I went thru a remediation in NJ, and the insurance company missed paying one bill($1400 out of the over $200k that was already paid. They are paying it now. They tracked me down, 7 years later, in Nashville, no less. My husbands name was on the bill, but it was sent to me, knowing I;m now a widow. That big mess caused stress on his heart, and I was told, and it was sudden, that he needed a transplant.
Do not take any chances as it seems they were hiding it, so imagine what else they are hiding.

[Bergenite]

There's one copper tubing going over toward the water heater. One oil line usually means an indoor tank, two lines- an underground tank. There are exceptions of course. Were there any patched areas on the foundation from a fill or vent pipe? Is it possible that the oil tank was relocated to another part of the basement?

Just so you know, there's no legal reason that a decommissioned underground tank has to be removed. However, that's been the trend for a few years for the buyer to ask the seller to remove any tank underground.

[Diane Giam]

Originally Posted by Bergenite

There's one copper tubing going over toward the water heater. One oil line usually means an indoor tank, two lines- an underground tank. There are exceptions of course. Were there any patched areas on the foundation from a fill or vent pipe? Is it possible that the oil tank was relocated to another part of the basement?

Just so you know, there's no legal reason that a decommissioned underground tank has to be removed. However, that's been the trend for a few years for the buyer to ask the seller to remove any tank underground.

You have to be kidding, there could be a leaking tank under there. I had a neighbor who put in a new tank, knowing fully that the old tank was leaking.
I would not buy a property with a tank underground.

[JCK7778]

I have to agree with Diane. Also, from an insurance standpoint it is going to be very difficult to obtain homeowners insurance if there is a decomissioned tank. Most companies not mandate that the tank be removed prior to offering any type of approvals for a policy. The liability implication alone is enormous and as someone in the industry I would not purchase a home that has a current or decommissioned oil tank without documentation of removal by a certified company along with the documentation that soil tests came back negative.

You are talking about the possibility of hunderds of thousands of dollars in teh case of a leak, especially if the leak is large enough to impact any third parties or water sources.

Originally Posted by Diane Giam

You have to be kidding, there could be a leaking tank under there. I had a neighbor who put in a new tank, knowing fully that the old tank was leaking.
I would not buy a property with a tank underground.

[jonandcarrie]

Thanks for all of the advice & thoughts - we heard from the seller today that there was an underground oil tank but it was removed a long time ago. They haven't supplied documentation yet but we've put in a request with the town to see if they have anything on record.

We certainly would not buy a house with a tank underground, unless the seller was going to remove it and be responsible for any leaks/remediation.

We also have a professional there today scanning the property with detection equipment. We will see!

[HalfFull]

Nice that the tank is out, but the lack of documentation is a major concern. If the old tank had leaked significantly, there could still be soil/water contamination, which you could be responsible to remediate.

[boater1]

You should get any and all documentation about the tank being removed.
Go to town, see if there were permits.
You need a date or time frame.

You need written documentation from a (hopefully) rebutable company that the tank was removed and the surranding soil testing and was found clean. You cannot accept the word or hearsay of the seller, on anything.

If you are not given that documentation, I would walk.
Thinking ahead, if/when you go to sell, you will be asked for the same documentation from your buyer. You don't have, your buyer will walk.