Real Estate Basics – Title V and the Sale of a Home

TITLE V AND THE SALE OF A HOME

  • The Title V inspection should be done immediately when the house is listed for sale.
  • If weather conditions prevent an inspection, the septic can be inspected up to 6 months after the sale.
  • Local Board of Health standards can exceed the State requirements and can vary from town to town.
  • A passed Title V indicates that the septic system was functioning at the time of the inspection. It does not guarantee future functioning.
  • A failed septic must be disclosed to the buyer.
  • The owner of the property is responsible for remediating a failed system within 2 years after the inspection.
  • Prior to scheduling a closing, most lenders will require a copy of the failed report, a copy of engineered plan for a new system and at least 2 quotes from installers for the new system.
  • Most lenders will require an escrow of 1.5 times the average of the estimates to fix or replace the system. Some lenders will insist that the system be repaired or replaced prior to closing.
  • Massachusetts has a septic loan program. Go to the Mass Housing Web site for details.
  • Massachusetts also offers a tax credit of up to $6,000 over 4 years to help defray the cost of septic repairs to a primary residence.
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