Selling A Philadelphia House With An Oil Tank

The seller property disclosure statement is set by regulation, at 49 Pa. Code section 35.335a, and it runs to seventeen categories. Two of them reach a heating oil tank.

Under Hazardous Substances, item 14, the form asks: "Are you aware of any underground tanks or hazardous substances present on the property (structure or soil), including, but not limited to, asbestos, polychlorinated byphenyls (PCBs), radon, lead paint, urea-formaldehyde foam insulation (UFFI), etc?" Under Heating and Air Conditioning, item 10, it asks separately: "Are you aware of any underground fuel tanks on the property?"

The same subject, asked twice, in two different sections, by a form the State Real Estate Commission approves. That is not an area where a seller can reasonably claim the question was ambiguous.

Under 68 Pa.C.S. section 7303, a seller intending to transfer an interest in real property must disclose known material defects by completing all applicable items in a property disclosure statement, and a signed and dated copy has to be delivered to the buyer prior to the signing of an agreement of transfer. Not at closing. Before the contract.

Section 7308 is the part sellers are usually relieved to read: "The seller is not obligated by this chapter to make any specific investigation or inquiry in an effort to complete the property disclosure statement." You do not have to commission a tank sweep before listing. What you may not do is make a representation you know or have reason to know is false or misleading, or conceal a known material defect.

Section 7311 is the part that matters afterwards. A person who willfully or negligently violates a duty under the chapter is liable for the actual damages the buyer suffers, and an action must be commenced within two years after the date of final settlement. The tank does not stop being your problem when you hand over the keys; it stops being your problem two years later.

Plenty of Philadelphia sellers inherited a house, or bought it in 1998 from someone who told them nothing. The honest answer to both questions is that you do not know, and the honest answer is the correct one to give.

What that answer does, though, is transfer the question rather than close it. A disclosure saying the seller is unaware of any underground tank on a 1930s rowhouse with a capped pipe on the side wall invites the buyer's inspector to look, and a finding at that point lands mid-deal with the buyer holding the timeline.

This is the practical case for finding out before you list rather than during. Not because the statute requires it, because it does not, but because information you commissioned is information you control the timing of. The tank sweep page covers what that involves.

Removing before you list costs money at the worst time and takes the issue off the table entirely. You get the City permit and the Certificate of Approval, the soil result and the disposal records, and the disclosure answer becomes a documented yes with paperwork attached rather than an open question.

Crediting the buyer keeps cash in your pocket now and hands them a discount plus a problem. The difficulty is that a credit is negotiated under time pressure by someone who has just been told there may be contaminated soil, and buyers price uncertainty conservatively. A credit is almost always larger than the removal would have been.

There is also a third outcome nobody plans for, where the buyer's lender declines the property outright. That is not a negotiation, it is the deal ending, and it happens more often with a tank abandoned in place with no documentation than with any other version of this. The abandonment page covers why.

Three documents do the work: the City permit with its Certificate of Approval, the laboratory result for the soil taken from under the tank, and the disposal records for the tank and its contents.

The soil result is the one that carries the value. A removal with no sampling proves a tank is gone and proves nothing about what it left behind, which means the buyer's attorney is still asking questions. A clean laboratory result ends the conversation, and it stays with the property for the next sale too.

If the tank did leak, the position is better than most sellers expect. Cleanup is a defined process rather than an open-ended liability, and eligible costs above a $1,000 deductible are reimbursable up to $4,000 for tanks of 3,000 gallons or less, set out on the reimbursement page.

An as-is sale allocates the cost of repairs. It does not repeal Chapter 73. The disclosure statement is still required, the questions still have to be answered, and section 7311 still runs for two years after settlement.

A seller who knows there is a tank, marks the property as-is and answers no is in a materially worse position than a seller who discloses the tank and sells as-is anyway. The second one has a buyer who knew. The first has a buyer with a statute.