Home Buying in Bethel>Question Details

Daniel Hayes, Home Seller in Germantown, TN

Am I required to reimburse the bank for oil when buying a foreclosure - or in "as-is" condition?

Asked by Daniel Hayes, Germantown, TN Fri Feb 27, 2009

I'm closing on a home that is a foreclosure. The oil tank is nearly full and the bank is asking me to refund them for the oil left over. However the house was advertised "as-is" which seems to me anything in the or attached to the home goes with the sale unless otherwise specified (which the remaining oil wasn't).

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Scott A. Nelson’s answer
I always find it funny how people come up with answers to this issue. I'm a firm believer in just leaving the oil in whatever amount there is in the tank. Funny how the following is ignored:

1. Water in the hot water heater/furnace, it's gone through the meter, should that be reimbursed? Final water read is usually several days prior to closing, has the seller recieved benefit for that unimpeded use?

2. Gas in the gas lines, gone through a meter, should that be reimbursed also?

3. Pro-rate a security/alarm system contract?

I think it's one of those situations that is nit-pickey. What about the difference in oil tank levels between offer to purchase/purchase & sales contract & closing? How to account for sludge in tank? What if the buye tells the seller to take the oil with them, oil removal is usually more expensive than delivery?
1 vote Thank Flag Link Fri Feb 27, 2009
You'd have to review your contract. There should be language in there to cover these items, just as the final water bill, property taxes etc. From the sound of it you might have one over on the bank, Kudos, it doesn't happen often. Have your attorney/agent/broker review it though. Keep us informed on the outcome, there will be quite a few interested readers here.
1 vote Thank Flag Link Fri Feb 27, 2009
Daniel

Whenever there is a contract dispute, first refer to the contract. Does the Agreement of Sale mention the oil and what to do about it? If not does it address what to do about personal property left on the premesis after closing? What is the local custom with regard to oil in the tank at closing? You can refuse to pay remind the bank (seller) that your purchase was "AS IS" and if the oil is there at closing it's yours. Also point out that if they remove the oil and damage the tank or the property in the process that they will be responsible for repairs.
In Pennsylvania we address this issue in the AOS and any oil in the tank goes to the buyer without any additional payment or reiumbursement to the seller.
Good Luck
0 votes Thank Flag Link Fri Feb 27, 2009
It all depends on what you already agreed to in the contract. It is an absolutely normal adjustment at any closing table for the buyer to credit back the seller for oil in the tank. An "as is" clause refers to the structure and condition of the property, but does not necessarily mean if there's oil in the tank it's yours. The contract normally contains a clause that the property must be delivered in broom clean condition. If you are removing junk after the closing, then you should ask for them to waive the oil reimbursement. It all depends on what it said in the purchase and sale contract you already signed. You really need to consult your attorney (if buying in the state of CT) or closing agent regarding this matter to sort it out. Good luck!!
0 votes Thank Flag Link Fri Feb 27, 2009
You need to confer with your buyers agent. Unless all executed contracts are reviewed by an agent or attorney difficult to state.

I can certainly understand your point regarding "as is" .

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0 votes Thank Flag Link Fri Feb 27, 2009
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