Everything You Need To Know About Oil Tanks When Buying a Home

[@eimypalacios5849]

We’re looking at a home in NJ that has an above ground oil tank so we’ll make sure to get the inspection for the underground but what about the above ground? How do we know it’s in good condition? This is a home built in 1966 and the tank is old. First time home buyer. Thank you!!

[@JonathanGreeneRE]

Hi Eimy. Good question. Above-ground oil tanks are generally safe as long as they are in the basement and there are no cracked floors or outside and encased in a holder. You may still want to switch to gas, but above-ground tanks don't have the same issues because what you are worried about is leakage into the Earth. You still do a sweep for underground tanks as they are found all the time with other tanks present. Your home inspector would assess the age and functionality of the tank if you win. I hope this helps!

[@JanineDada]

Hi nice video. Do you have any info / pricing on removing a basement oil tank in Chicago, do you have any agents there?

[@JonathanGreeneRE]

Thank you, Janine. Is it above-ground or under the ground in the basement? Big cost differential. In NJ, for above-ground in the basement, it would be about $1,600. We have multiple investor-friendly agent connects in Chicago for you.

[@yomnamostafa3510]

I have an overground oil tank in my back yard no leaking, what is my responsibility as a home seller ?

[@JonathanGreeneRE]

If the tank is outside it should be encased inside of something else to prevent any potential leaks from hitting the ground, unless it's a Roth tank which has it's own policy and setup. As a seller, an above-ground oil tank that is not leaking is not something you have to remove. Some buyers may not want it that way, but the issue with oil tanks is the potential for leaking. One other note, you should have done on purchase an oil tank sweep because many homes with above-ground tanks have abandoned ones still underground on the property. I hope that helps.

[@hichamjouahri4577]

I am about to sign a contract for townhome and I read that immediately south of townhome property is parcel which is owned by the city of Fairfax in Virginia and is unimproved . Located immediately south of the parcel is petroleum tank farm which was established in 1965 . The tank is used to store and handle liquid fuels and includes truck loading and unloading area . It’s new townhome 2023 and the builder advised purchaser that a number of investigations have been conducted with respect to environmental conditions of the townhome . Please help , I am confused

[@JonathanGreeneRE]

When buying a townhome, you are protected from this type of issue to your property as the development has to do due diligence on nearby anomalies. With that said, the petroleum tank farm near you is more of a family thing for you to decide and also weight the chances of spills and if they are near connected water sources. But what I talk about in this video, for our area, does not apply to you buying a townhome. I hope that helps.

[@hichamjouahri4577]

@@JonathanGreeneRE thank you . The spill happened one time in 2010 and the case settled with some homeowners in the area . This one is new home and very close to the the farm 0.3 miles

[@JonathanGreeneRE]

@@hichamjouahri4577 they should have full documentation, but there is definitely more health risk than liability risk since it's a townhouse.

[@hichamjouahri4577]

@@JonathanGreeneRE in your opinion , I should not buy if the health risk is my major concern ?

[@JonathanGreeneRE]

@@hichamjouahri4577 I can't say yes or no without being involved, but I would just make sure to get all the information on it until you feel comfortable.

[@erolusta2009]

I am trying to buy a house, and I asked the owner about the oil tank and he told me he does not have information about the tank, they do not know where it is of if there anyone. What should I do ?

[@JonathanGreeneRE]

When you do your home inspection just do an oil tank sweep. Some regular home inspectors do them, but you can also book a company that only does oil tank sweeps. They will be able to determine by scanning the ground and looking for evidence and records if one existed, if it has been removed, or if one is still there.

[@osbinaguilar1173]

Hello I’m a first time buyer in Paterson nj found 2 abandoned oil tanks with permits and certificates recovery Should I buy the home if I do soil testing and everything comes back good ? I told the seller to remove the tanks but he is selling as is anything I can do btw the home was built in 1970

[@JonathanGreeneRE]

No, you should not close with underground oil tanks. It is not safe and your attorney should not allow you to close either. The old way of decommissioning oil tanks was not foolproof and soil testing is not 100% accurate and less so if not under grass. As a first-time home buyer you shouldn't be buying houses as is because of this reason. It's too risky.

[@osbinaguilar1173]

Oil tank permits were taken out in 2010 Attorny is saying to move forward with it since there’s a plan b there’s a company that does soil testing if it all comes back good they offer an insurance policy where if I end up removing the tanks myself and they happen to catch contamination they cover it . Each tank is around 1.6k for the insurance policy I’m lost here not sure if that’s a good route to take Ik ur the pro wanted to add a little more so u Can see my situation

[@JonathanGreeneRE]

@@osbinaguilar1173 We don't write offers for first-time homebuyers on as-is properties and we would never let a first-time homebuyer close with tanks underground, ever. That's just our comfort level. Soil testing is not absolute nor does insurance cover everything. You want to pay $3,200/year for insurance on tanks that you are voluntarily taking on for someone else? Makes no sense to me.

[@osbinaguilar1173]

@@JonathanGreeneRE thank you so much for replying quickly it’s a sellers market I was told no room to negotiate anything else that was my last resort been house hunting for over 3 months now Thank you so much for the advice feel better now knowing it’s not smart to buy it as is

[@JonathanGreeneRE]

@@osbinaguilar1173 It is a seller's market and there isn't too much room to negotiate, those are both correct statements. But you are potentially taking on a contaminated property and likely paying top dollar to do it. When people convince you that you have to comply with something you are uncomfortable with, it's not the house for you. Maybe it's clean, but maybe it's not and are you ready to make the biggest purchase of your life with a chance you could have contaminated soil and not a 100 pct chance that it's not?