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Need to Sell a House With a Septic Tank: No Sewer, No Problem!

It’s time to put the house on the market, and you’re nervous about how buyers will perceive the septic tank—your property’s means of wastewater treatment. However, home sales involving septic tanks are par for the course. In fact, 1 in 5 households nationwide depend on a septic system to treat and dispose of their wastewater, as opposed to a centralized public sewer system.

While there are buyers out there who don’t want to have to deal with a septic tank or well water, those scouting certain properties understand that a septic tank goes with the territory.

In fact, buyers looking for other features your home has—such as a rural setting with large acreage—may anticipate having a septic tank and a well on the property.

What are the different types of septic systems, and how do they compare to a public sewer?

Septic systems fall under a variety of names, including:

  • private sewage systems

  • individual sewage disposal systems

  • cluster systems

  • decentralized wastewater treatment systems

  • on-lot systems

  • package plants

  • onsite wastewater treatment systems

Regardless of what it’s called, this system is an underground wastewater treatment structure for housing and businesses that aren’t connected to a public or centralized sewer system.

What are the different types of septic systems, and how do they compare to a public sewer?

Septic systems fall under a variety of names, including:

  • private sewage systems

  • individual sewage disposal systems

  • cluster systems

  • decentralized wastewater treatment systems

  • on-lot systems

  • package plants

  • onsite wastewater treatment systems

Regardless of what it’s called, this system is an underground wastewater treatment structure for housing and businesses that aren’t connected to a public or centralized sewer system.

What type of maintenance is required to keep the septic tank in selling condition?

All the wastewater we use—from the bathroom, laundry, and kitchen—needs to be treated to remove or neutralize pathogens and pollutants like phosphorus and nitrogen, according to the Environmental Protection Agency (EPA). In a centralized sewer system, sewer mains flow into progressively larger pipes until they reach a wastewater treatment plant; with a private septic system, this treatment occurs on the property.

A typical septic system consists of a main drainage pipe, a septic tank and a drainfield, or soil absorption field. Systems can have additional components such as pumps and electrical float switches.

The septic tank is often a concrete, fiberglass, or polyethylene watertight container buried underground. It separates any solids, organic matter, and floatable material (such as oils and grease) from the liquid wastewater, which exits into the shallow drainfield. From the drainfield, the treated wastewater disperses through the soil, ultimately discharging to groundwater. The separated solids and sludge remain in the tank until they’re removed by a professional septic service.

The National Environmental Services Center (NESC) at West Virginia University in Morgantown, W.Va., says that solids take about 24 to 48 hours to settle. A four-bedroom home with a 1,000-gallon tank typically would need about two days for solids to settle—but as more solids accumulate, the settling time decreases. More than one-third of the liquid depth, and the tank should be pumped and cleared.

Problems can occur when the tank is overdue for drainage or when the drainfield becomes overloaded, causing flooding or sewage to flow into the ground or back into the home, these experts say.

The EPA recommends that you have your household septic system inspected at least every 3 years and pumped every 3 to 5 years, depending on the size of your household, the septic tank, and other factors.

(If your system has mechanical components or additional pumps, the EPA suggests an annual inspection.)

Are sellers required to disclose a home’s septic tank system?

The short answer is generally yes—sections about a home’s water treatment systems are common on individual state real estate disclosure forms but may vary in the details you’re prompted to provide in writing to the buyer.

and how much does it cost?

A qualified private contractor typically inspects septic systems. Some local health departments do as well for a fee; others will refer homeowners to appropriate wastewater professionals.

Small business sites such as Angie’s List or Thumbtack also provide searchable databases of professionals in your area.

A typical inspection involves determining the location of the underground tank, either with the help of a sketch of the system from the permitting process or by flushing a small radio transmitter—about the size of a small pill bottle—down the toilet. The inspector removes the transmitter after locating the tank. (Depending on the location of your septic tank, you may be able to uncover and open it yourself, reducing the inspection fee.

An inspector then measures the level of solids in the tank with a long, hollow pole called a Sludge Judge and checks the tank’s other components.

An inspection can take about two to two and a half hours, according to Thumbtack. Depending on your home’s location, most inspections cost $100 to $250. Add an additional $50 to $250, based on the depth of the tank, if the inspector has to uncover the tank.

That’s a negligible cost considering the potential price of repairs. Replacing a drainfield can run from $2,500 to $10,000, according to Thumbtack.

Some companies will offer special pricing, such as $75 for a septic diagnostic test.

What if your House has a Failed Septic System?

Let’s go over the different aspects of trying to sell your home without a working septic system. Not only knowing the do’s and don’ts of selling a home in bad condition can save you time and effort, but it also can be the only solution if you don’t have the money for the repair or replacement of your septic system.

In rural areas, where many remaining septic systems are located, there may be a market for your home “as-is”. People who have grown up there may want to buy a nearby home so they can stay in the area. However, this probably doesn’t represent a large part of the buying public.

Because of liability issues, most brokerage firms are not interested in listing a house for sale with a significant problem like this. Especially in the seller’s market, agents aren’t looking for listings with issues that property owners aren’t willing to resolve.

Realtors are primarily looking for listings that will sell quickly, with minimal concerns, and for the highest price. Because their compensation is commission-based (percentage from the final selling price), this impacts how quickly and how much they get paid.

While it may be possible for you to find a buyer who will be willing to take on the responsibility for repairing the septic system, it will almost certainly mean that they will need a lot of cash.

Mortgage lenders will insist that the collateral for their loan can be easily sold in the event that the borrower defaults. This means that the home has to be functional with all systems in good working order. As the septic system is one of the most important ones, it would have to be fixed before closing.

Most buyers only have enough cash for their down payment. They don’t have the funds to make major repairs, and so they look for homes that are “move-in ready”. If they do have the cash, it would not be advisable for them to fix problems with a property that they do not own yet.

You’re looking for a buyer to whom you will sell your house for cash in Harford county, MD and surrounding areas and who wants a property that needs to be purchased “as-is” and then fix the problems themselves. This is exactly what real estate investors do on a regular basis.

Real estate investors fall into two main categories. The first are sometimes called house-flippers. They will fix up a house for immediate resale. House-flippers are looking for short term profits.

The second group are long term investors who want to hold the property and rent it to tenants. This group is looking for long term rental income with a possible sale down the road.

Both types of investors benefit from buying homes that need work. They are professionals in repairing properties themselves. This saves them money compared to a homeowner having to pay someone to repair their property.

An investor’s business model calls for buying homes below market value due to considerable repairs or remodeling that they can handle for themselves. Even a condemned house can be sold pretty easily if the seller targets investors as potential buyers.

Is It Legal to Sell a House with a Bad Septic System?

Depending on the state, it may be illegal to sell a property that will be used as the buyer’s primary residence unless it is safe and sanitary to live in.

Investors in your area will be familiar with your local building codes. It may be possible to sell your home as an investment property. If not, an experienced real estate investor where you are located will have dealt with this before.

They will have a plan for making repairs using their funds before the title is transferred. For example, an investor can issue you a loan backed up with your home’s equity. You will then use this money to repair the septic. Once it’s done, you will sell the house to the investor.

Pros and Cons of Selling the House As Is

The biggest advantage of selling your house “as-is” is that you can pass on the problem to the buyer. You avoid:

  • spending your cash upfront for repairs

  • finding someone to do the repairs

  • comparing quotes

  • overseeing the work

  • waiting on the sale of your house to recover your expenses

If an individual homeowner who’s buying your house attempts to do this, you will be adding more time and uncertainty to an already long process.

An experienced real estate investor pays cash, performs their own inspection, and is not scared off when major repairs are needed. They can close quickly, even when there are serious problems with a property such as a bad septic system.

Selling directly to an investor will also let you avoid many other costs of selling a home such as broker commissions.

Cons of Selling the House As Is

When selling your house “as-is”, you will not net as much money as if you made repairs (as well as reasonable improvements) yourself and then sold the property. A buyer, whether an investor or future homeowner, will discount the price for the cost of repairs and for their time and effort in having the repairs made.

As for the investors they will have a formula for calculating their offer to you. They should go over their calculations and explain their offer when they present it to you. For example, if the investor is going to resell the property, apart from the estimated cost to repair the septic system, they will also discount the price for the amount of expected profit.

If after weighing the pros and cons you see that selling your house as is to a real estate investor is your likely solution, you are welcome to request a no obligation cash offer from Easy Outs Homes — a local house buying company home for sellers who need to sell a distressed property fast and easy.

How Much Does It Cost to Repair a Failed Septic System?

The other option that you have when selling a house with a bad septic system is to have the repairs made and then sell your house. Once your home is in good working order, you can use the traditional methods of selling your home:

  • listing it with a realtor

  • selling it for yourself (‘For Sale By Owner’ or FSBO route)

The average cost of repairing the line leading to your septic tank from your house will be from $1,000 to $4,500. If your tank needs replacement, the average cost is from $3,000 to $10,000. If your leach or drain field needs repairs, it can cost anywhere from $2,500 to $15,000.

The difference in your cost can be the size of your house, the type of soils on your property, and changing building or environmental codes.

Making sure that you properly fix your septic system can involve your local health department, state environmental department, or even the federal EPA.

The regulations in your area may have changed since your system was originally installed. There may be added requirements such as a reserve drain field, or use of an alternative system if too many septic systems are now in use in your area.

If you don’t have “as-built” drawings showing the exact location of your system, your septic contractor may have to disturb more of your property in order to carefully locate the system components.

These factors can increase the cost of repairing or replacing your septic system.

How Long Does It Take to Repair a Septic System?

If your system needs repairs, it can take from 2 to 5 days. It may take longer depending on the weather.

If you have to replace your system, you should schedule for 2 to 3 weeks. A new system will require permitting, which might include soil testing. Inspections are part of the process and your county inspector’s availability can increase the time it will take to complete the work.

Pros and Cons of Repairing the Septic System and Selling the House

Pros of Repairing the Septic System and Selling the House

You should certainly get a higher price for your house with a working septic system than without it.

Bear in mind that normal market value for an existing house assumes that all systems on the property are in good working order. You may recapture the costs of minor repairs in the higher sale price. However, if you have to completely replace your system, you may not get an increase in price that is equal to your costs.

Cons of Repairing the Septic System and Selling the House

Many people don’t have the funds available to do the work necessary to put their septic system in good working order.

Pulling the cash from savings may create difficulties if other needs arise before you can sell your house and recapture those funds.

Unlike working with professional local real estate investors, selling your house the traditional way, with a real estate agent specializing in your area, will also involve closing costs such as realtor commissions.

You should subtract these from the market value to calculate your net proceeds from a sale. This will make it harder to receive a dollar for dollar repayment of your repair costs.

Many people can’t devote the time needed to oversee an extensive repair or replacement of their septic system. It may also require a lot of time doing landscaping repair after the septic work is done.

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