Oil Tank Crisis - Please help!

11 Replies

Hi BP family,

I need help in figuring out a path forward. What would you do?


Purchased 7/26 triplex in Orange NJ for $296k with a conventional 30y mortgage in my name. 2 oil tanks were onsite before purchase. ~27k was put in escrow for removal and soil remediation.

Current Scenario:

After removing the tanks, the oil tank company hired by seller determined that the remediation is more substantial then estimated. No evidence of ground water or bedrock, but the plume is bigger than first thought. They went from an estimate of ~$10k to ~$100k. Their strategy is to go after the insurance company that insured the tanks years ago. They plan to age date the soil back to when the insurance was in place. They are not 100% the insurance will pay out.

I can not close the tank permit without a No Further Action letter (NFA) from the state. I cannot get a CO with the permit open and cannot rent the units. My holding costs are bleeding me dry in the meantime.

If the insurance company honors the claim it will still take several months to get an NFA. If they don't it will still take months to find that out. Then what? It doesnt make any sense to pay $100k out of pocket to get this resolved.

I have learned a ton in getting to this point and now fully understand why oil tanks turn people away, but what can i do going forward? It will be a major setback to continue paying a mortgage on a non performing property for a year or worse, pay $100k out of pocket.

Does anyone have any creative ideas?

Ask the town for permission to rent in lieu of the NFA?

Somehow shift this and the missing rent back to the seller?

I am taking action to move this forward, but the path ahead is BLEAK!


I'm a commercial litigation attorney in Morristown, New Jersey. The firm I work for may be able to help you, but we will need more information. Feel free to shoot me an email (email address listed on my profile). I'm sorry to hear about this!

@Christopher Prince-Barry

You really need to discuss with an attorney. Did you purchase with an attorney?and was that attorney any good (semi-trick question).

We’d have to know more about the prior insurance policy which is probably null and void if you are talking about the policy the prior owner had. Also, we’re there any additional terms in the contract of sale when you purchased the property.


Direct message me if you’d like to chat..

Good luck

@Christopher Prince-Barry once the tank is out and has documented spillage and soil soak, there isn't much you can do. No new oil company is going to come in and take over the spillage portion without ending up with the same price. Going back, you don't close with escrow for oil tanks. I am not sure who your attorney was or your insurance company, but that is obviously not a good move. To be completely honest, you are screwed and stuck with this problem since you closed and I am sorry to say that. An attorney will help, but isn't going to get you out of what you signed on for and agreed to. The town will in no way cooperate or assist in East Orange, it's literally the least likely town in Essex to help. You can only proceed with an NFA and clear paperwork from DEP. The prior tank policy will not cover this most likely because they will say the issues occurred on the pull and evidentially, it will be very hard to call it old oil seepage. Thanks for looping me in @Matt M.

@Christopher Prince-Barry I wish I had better new for you bu this one seems pretty bleak. I don't know that the measures taken to back date the oil spillage will get you the desired result, also, it sounds like that process is going to cost you more money. The best bet here is to see wha legal recourse you have or to see if another company can remediate at a lower cost. Call @Jessica Zolotorofe she's a great resource and she can help fro the legal end. You may also want to call Water Resource Technology they are always honest and have fair pricing.