Consumer guides for clients updated 5 28

Consumer Guides for

Clients

HomesJustForYou Team

Keller Williams Realty North West 680 Mechanic St., Suite 250/ Leominster, MA 01453

978-786-5160 / Direct: 978-833-3569 E-Mail: [email protected]

“They listened, understood our needs and gave exceptional service.”

(comments from our customers)

Index

Agency Types (Real Estate - Massachusetts) ………………….………………page 1

Asbestos - What’s the hazard? ……………………………………………..…….page 7

Contract to Purchase ……………………………………………………….….....page 11

Electric and Magnetic Fields …………….……………………………….……....page 13

Home Inspection Facts For Consumers (MA)……………………….….……….page 14

Home Loan Guide ………………………………………………………………...page 16

Home Warranty Information..……………………………………………….…..page 67

Homeowner Oil Heating System Upgrade and Insurance Law…………….…..page 68

Homestead - Protecting Principal Residence from law suits (Massachusetts)

Homestead Act - Questions and Answers………………………….……………..page 70

Lead Paint

Massachusetts Lead Paint Law and Property Transfer Notification……………...page 82

Protect Your Family From Lead In Your Home………………………………….page 93

Could Nutrition Play A Major Role In Lead Paint Poisoning?...............................page 109

Mold (Informational Guide)………………………………………………….……..page 115

Radon

A Citizen’s Guide to Radon (EPA)……………………………………….……….page 132

Septic Systems, Title 5 Information...…………………………………….……….page 148

Smoke Detector and CO Detector Information…………………...……………...page 152

Title Insurance

70+ Ways To Lose Your Home……………………………….…………………..page 164

Underground Storage Tanks (USTs) ………………………….………………….page 168

Water Quality - Home Water Testing…………………………………………….page 170

Well - Private Well Drinking Water……………………………….……………...page 208

Dug Wells………………………………………………………………...…….page 209

Driven Wells………………………………………………………….…..…….page 210

Drilled Wells……………………………………………………….…..……….page 211

Private Well Guide - Massachusetts………………….……………………..……..page 212

2.07.2013

Client #1 Name_______________________________________

Client #2 Name_______________________________________

4 Agency Types (Real Estate - Massachusetts)

4 Asbestos - What’s the Hazard

4 Contract to Purchase Real Estate

4 Electric and Magnetic Fields

4 Home Inspection Facts for Consumers

4 Home Loan Guide

4 Home Warranty Information

4 Homeowner Oil Heating System Upgrade and Insurance Law

4 Homestead Information

4 Lead Paint Information

4 Mold Guide

4 Radon Guide

4 Septic Systems, Title V Information

4 Smoke Detector and CO Detector Information

4 Title Insurance

4 Underground Storage Tanks (USTs)

4 Water Quality - Home Water Testing

4 Well Types

CONSUMER GUIDES CHECKLIST

I (we) received the checked information.

_______________________________________________ _________________________________________________Client Client

MASSACHUSETTS MANDATORY LICENSEE-CONSUMER RELATIONSHIP DISCLOSURE

This disclosure is provided to you, the consumer, by the real estate agent listed on this form. Make sure you read both sides of thisform. The reverse side contains a more detailed description of the different types of relationships available to you. This is not acontract.

THE TIME WHEN THE LICENSEE MUST PROVIDE THIS NOTICE TO THE CONSUMER:

All real estate licensees must present this form to you at the first personal meeting with you to discuss a specific property. The licenseecan represent you as the seller (Seller's Agent) or represent you as the buyer (Buyer's Agent) and also can assist you as a facilitator.

CONSUMER INFORMATION AND RESPONSIBILITY:

Whether you are the buyer or seller you can choose to have the advice, assistance and representation of your own agent who works foryou. Do not assume that a real estate agent works solely for you unless you have an agreement for that relationship. Withyour consent, licensees from the same firm may represent a buyer and seller in the same transaction. These agents are referred to asdual agents.

Also a buyer and seller may be represented by agents in the same real estate firm as designated agents. The "designated seller orbuyer agent" is your sole representative. However where both the seller and buyer provide written consent to have a designated agentrepresent them then the agent making such designation becomes a "dual agent" for the buyer and seller. All real estate agents must,by law, present properties honestly and accurately. They must also disclose known material defects in the real estate.

The duties of a real estate agent do not relieve the consumers of the responsibility to protect their own interests. If you need advice forlegal, tax, insurance or land survey matters it is your responsibility to consult a professional in those areas. Real Estate agents do nothave a duty to perform home, lead paint or insect inspections nor do they perform septic system, wetlands or environmentalevaluations.

RELATIONSHIP OF REAL ESTATE LICENSEE WITH THE CONSUMER

(check one) ___Seller's agent ___Buyer's agent ___FacilitatorIF A SELLER'S OR BUYER'S AGENT IS CHECKED ABOVE COMPLETE THE SECTION BELOW:

Relationship with others affiliated with ___________________________________________________ (Print name of real estate firm or business and license number)

(Check one) ____The real estate agent listed below, the real estate firm or business listed above and all other affiliated agents have the same relationship with the consumer named herein (seller or buyer agency, not designated agency).

____Only the real estate agent listed below represents the consumer named in this form (designated seller or buyer agency). In this situation any firm or business listed above and other agents affiliated with the firm or business do not represent you and may represent another party in your real estate transaction.

By signing below I, the real estate licensee, acknowledge that this disclosure has been provided timely to the consumer named herein.

_________________________ ____________________________ _____________ ____________(signature of real estate agent) (Printed name of real estate agent) (License Number/Type) (Today's Date)

By signing below I, the consumer, acknowledge that I have received and read the information in this disclosure.

_______________________ ________________________ _____________(Signature of consumer) (Printed name of consumer) (Today's Date)

_______________________ ________________________ _____________(Signature of consumer) (Printed name of consumer) (Today's Date)

___Check here if the consumer declines to sign this notice.

1

TYPES OF AGENCY REPRESENTATION

SELLER'S AGENT

A seller can engage the services of a real estate agent to sell his property (called the listing agent) and the real estateagent is then the agent for the seller who becomes the agent's client. This means that the real estate agent representsthe seller. The agent owes the seller undivided loyalty, reasonable care, disclosure, obedience to lawful instruction,confidentiality and accountability, provided, however, that the agent must disclose known material defects in the realestate. The agent must put the seller's interests first and negotiate for the best price and terms for their client, the seller.(The seller may authorize sub-agents to represent him/her in marketing its property to buyers, however the seller shouldbe aware that wrongful action by the real estate agent or sub-agents may subject the seller to legal liability for thosewrongful actions).

BUYER'S AGENTA buyer can engage the services of a real estate agent to purchase property and the real estate agent is then the agentfor the buyer who becomes the agent's client. This means that the real estate agent represents the buyer. The agentowes the buyer undivided loyalty, reasonable care, disclosure, obedience to lawful instruction, confidentiality andaccountability, provided, however, that the agent must disclose known material defects in the real estate. The agent mustput the buyer's interests first and negotiate for the best price and terms for their client, the buyer. (The buyer may alsoauthorize sub-agents to represent him/her in purchasing property, however the buyer should be aware that wrongfulaction by the real estate agent or sub-agents may subject the buyer to legal liability for those wrongful actions).

(NON-AGENT) FACILITATOR

When a real estate agent works as a facilitator that agent assists the seller and buyer in reaching an agreement but doesnot represent either the seller or buyer in the transaction. The facilitator and the broker with whom the facilitator isaffiliated owe the seller and buyer a duty to present each property honestly and accurately by disclosing known materialdefects about the property and owe a duty to account for funds. Unless otherwise agreed, the facilitator has no duty tokeep information received from a seller or buyer confidential. The role of facilitator applies only to the seller and buyer inthe particular property transaction involving the seller and buyer. Should the seller and buyer expressly agree a facilitatorrelationship can be changed to become an exclusive agency relationship with either the seller or the buyer.

DESIGNATED SELLER'S AND BUYER'S AGENT

A real estate agent can be designated by another real estate agent (the appointing or designating agent) to representeither the buyer or seller, provided the buyer or seller expressly agrees to such designation. The real estate agent onceso designated is then the agent for either the buyer or seller who becomes their client. The designated agent owes thebuyer or seller undivided loyalty, reasonable care, disclosure, obedience to lawful instruction, confidentiality andaccountability, provided, however, that the agent must disclose known material defects in the real estate. The agent mustput their client's interests first and negotiate for the best price and terms for their client. In situations where the appointingagent designates another agent to represent the seller and an agent to represent the buyer then the appointing agentbecomes a dual agent. Consequently a dual agent cannot satisfy fully the duties of loyalty, full disclosure, obedience tolawful instructions which is required of an exclusive seller or buyer agent. The dual agent does not represent either thebuyer or the seller solely only your designated agent represents your interests. The written consent for designated agencymust contain the information provided for in the regulations of the Massachusetts Board of Registration of Real EstateBrokers and Salespeople (Board). A sample designated agency consent is available at the Board's website atwww.mass.gov/dpl/re.

DUAL AGENT

A real estate agent may act as a dual agent representing both the seller and buyer in a transaction but only with theexpress and informed consent of both the seller and buyer. Written consent to dual agency must be obtained by the realestate agent prior to the execution of an offer to purchase a specific property. A dual agent shall be neutral with regard toany conflicting interest of the seller and buyer. Consequently a dual agent cannot satisfy fully the duties of loyalty, fulldisclosure, obedience to lawful instructions which is required of an exclusive seller or buyer agent. A dual agent does,however, still owe a duty of confidentiality of material information and accounting for funds. The written consent for dualagency must contain the information provided for in the regulations of the Massachusetts Board of Registration of RealEstate Brokers and Salespeople (Board). A sample dual agency consent is available at the Board's website atwww.mass.gov/dpl/re.

agency disclosure-exclusive agency5.doc

2

07/24/2012

4

7/24/2012

_______________________________________________________________________________________MASSACHUSETTS CONSENT TO DUAL AGENCY

A real estate broker or salesperson may act as a dual agent who represents both prospectivebuyer and seller with their informed written consent. A dual agent is authorized to assist the buyerand seller in a transaction, but shall be neutral with regard to any conflicting interest of the buyerand seller. Consequently, a dual agent will not have the ability to satisfy fully the duties of loyalty,full disclosure, reasonable care and obedience to lawful instructions, but shall still owe the duty ofconfidentiality of material information and the duty to account for funds.

Buyers and sellers should understand that material information received from either client that isconfidential may not be disclosed by a dual agent, except: (1) if disclosure is expressly authorized;(2) if such disclosure is required by law; (3) if such disclosure is intended to prevent illegal conduct;or (4) if such disclosure is necessary to prosecute a claim against a person represented or todefend a claim against the broker or salesperson. This duty of confidentiality shall continue aftertermination of the brokerage relationship.

BUYER/SELLER ACKNOWLEDGMENT

I acknowledge and agree that ________________________________________________ is (are)authorized to represent both the buyer and seller as a dual agent. I hereby consent to dual agency.

________________________________Signature of Buyer Seller Print Name Today's Date

[check one]

________________________________Signature of Buyer Seller Print Name Today's Date

[check one]

BROKER/SALESPERSON ACKNOWLEDGMENT

I acknowledge and agree to represent the above named consumer as a dual agent and mysignature below signifies that I understand the duties and responsibilities of that relationship, andexplained to the consumer that I am a dual agent and therefore will assist the buyer and seller in atransaction, but shall be neutral with regard to any conflicting interest of the buyer and seller.

________________________________Signature of Broker/Salesperson License Number Today's Date

© 2005 MASSACHUSETTS ASSOCIATION OF REALTORS®

___________________________ ___________________________

___________________________ ___________________________

___________________________ ___________________

Form 710

5

NOTICE OF DUAL AGENCY[For use when previous consent was obtained from seller in listing agreement

and from buyer in buyer representation agreement]

Broker previously gave notice of the potential for a dual agency relationship to occur inconnection with your real estate transaction. That disclosure was contained either in theExclusive Listing Agreement (for Seller) or in the Exclusive Buyer Representation Agreement(for Buyer). You previously gave your consent to that relationship.

Broker now gives notice that a dual agency has occurred and that Broker and affiliatedlicensees represent both Buyer and Seller in connection with the property described as

_____________________________________________________(the “Property”).

A dual agent is authorized to assist the buyer and seller in a transaction, but shall be neutralwith regard to any conflicting interest of the buyer and seller. Consequently, a dual agent will nothave the ability to satisfy fully the duties of loyalty, full disclosure, reasonable care andobedience to lawful instructions, but shall still owe the duty of confidentiality of materialinformation and the duty to account for funds.

BROKER Or Authorized Representative:

Signature Print Name Date

Acknowledgment[optional]

I acknowledge receipt of this Notice of Dual Agency.

SELLER BUYER [check one]


SELLER BUYER [check one]


© 2005 MASSACHUSETTS ASSOCIATION OF REALTORS®03.25.05/348372

_____________________________________________________________________________

____________________________________________________________________________

____________________________________________________________________________

____________________________________________________________________________

Form 712

6

You are here: EPA Home Air & Radiation TTN Web - Technology Transfer Network Air Toxics Web siteAsbestos

Technology Transfer NetworkAir Toxics Web SiteContact Us Search: All EPA This Area

Asbestos1332-21-4

Hazard Summary-Created in April 1992; Revised in January 2000Asbestos has been used in building materials, paper products, plastics, and other products. Exposure mainly occurs in indoor air where it may be released from these materials. Effectson the lung are a major health concern from asbestos, as chronic (long-term) exposure toasbestos in humans via inhalation can result in a lung disease termed asbestosis. Asbestosisis characterized by shortness of breath and cough and may lead to severe impairment ofrespiratory function. Cancer is also a major concern from asbestos exposure, as inhalationexposure can cause lung cancer and mesothelioma (a rare cancer of the thin membraneslining the abdominal cavity and surrounding internal organs), and possibly gastrointestinalcancers in humans. EPA has classified asbestos as a Group A, known human carcinogen.

Please Note: The main sources of information for this fact sheet are EPA's Integrated RiskInformation System (IRIS), which contains information on the carcinogenic effects of asbestosincluding the unit cancer risk for inhalation exposure, and the Agency for Toxic Substances andDisease Registry's (ATSDR's) Toxicological Profile for Asbestos.

UsesThe main uses of asbestos are in building materials, paper products, asbestos-cementproducts, friction products, textiles, packings and gaskets, and asbestos-reinforcedplastics. (1)Asbestos use in the United States is currently decreasing. (1)

Sources and Potential ExposureAirborne exposure to asbestos may occur through the erosion of natural deposits inasbestos-bearing rocks, from a variety of asbestos-related industries, or from clutches andbrakes on cars and trucks. The concentrations in outdoor air are highly variable. (1)Asbestos has been detected in indoor air, where it is released from a variety of buildingmaterials such as insulation and ceiling and floor tiles. It is only released, however, whenthese building materials are damaged or disintegrate. Typical concentrations in indoor airrange from 1 to 200 nanograms per cubic meter (ng/m3) (0.000001 to 0.002 milligramsper cubic meter (mg/m3)). (1)Asbestos may be released to water from a number of sources, including erosion of naturaldeposits, corrosion from asbestos-cement pipes, and disintegration of asbestos roofingmaterials with subsequent transport into sewers. (1)

Assessing Personal ExposureIt is possible to test for the presence of asbestos fibers in urine, feces, or mucus. Inaddition, a chest X-ray, although it cannot detect the asbestos fibers themselves, candetect early signs of lung disease caused by asbestos. (1)

Health Hazard InformationAcute Effects:

No studies were located on the acute (short-term) toxicity of asbestos in animals or

TTN Home

ATW Home

Rules &Implementation

National-Scale AirToxicsAssessment

Risk Studies

Education &Outreach

About Air Toxics

Pollutants &Sources

State, Local, TribalResources

Publications

Contacts

TechnicalResources

Share

Go

7

humans. (1-4)

Chronic Effects (Noncancer):Chronic inhalation exposure to asbestos in humans can lead to a lung disease calledasbestosis, which is a diffuse fibrous scarring of the lungs. Symptoms of asbestosis includeshortness of breath, difficulty in breathing, and coughing. Asbestosis is a progressivedisease, i.e., the severity of symptoms tends to increase with time, even after theexposure has stopped. In severe cases, this disease can lead to death, due to impairmentof respiratory function. (1,2)Other effects from asbestos exposure via inhalation in humans include pulmonaryhypertension and immunological effects. (1,2)Feeding studies in animals exposed to high doses of asbestos have not detected anyevidence of adverse toxic effects. (1,2)EPA has not established a Reference Concentration (RfC) or a Reference Dose (RfD) forasbestos. (5)

Reproductive/Developmental Effects:No studies were located on the developmental or reproductive effects of asbestos inanimals or humans via inhalation. (1,2,3)Birth defects were not noted in the offspring of animals exposed to asbestos in the dietduring pregnancy. (1)No effects on fertility were observed in animals exposed to asbestos in the diet duringbreeding, pregnancy, and lactation. (1)

Cancer Risk:A large number of occupational studies have reported that exposure to asbestos viainhalation can cause lung cancer and mesothelioma (a rare cancer of the membranes liningthe abdominal cavity and surrounding internal organs). (1,2,3)Individuals who smoke and are also exposed to asbestos have a greater than additiveincreased risk of developing lung cancer. (1)Several occupational studies have reported an increase in gastrointestinal cancer frominhalation exposure to asbestos and subsequent oral ingestion. (1,2)Long- and intermediate-range asbestos fibers (>5 micrometers (µm)) appear to be morecarcinogenic than short fibers (<5 µm). (1)Several epidemiological studies have found an association between asbestos in drinkingwater and cancer of the esophagus, stomach, and intestines; however confounding factorsand the short followup time relative to the long latent period for tumor formation make itdifficult to interpret the results. (1,5)A series of large-scale lifetime feeding studies in animals reported that intermediate-rangeasbestos fibers increased the incidence of a benign tumor of the large intestine in malerats, while short-range asbestos fibers showed no significant increase in tumor incidence.(1,5)EPA considers asbestos to be a human carcinogen (cancer-causing agent) and has rankedit in EPA's Group A. (5)EPA uses mathematical models, based on human and animal studies, to estimate theprobability of a person developing cancer from breathing air containing a specifiedconcentration of a chemical. EPA calculated an inhalation unit risk estimate of 2.3 × 10-1

(fibers/cm3)-1. EPA estimates that, if an individual were to continuously breathe aircontaining asbestos at an average of 0.000004 fibers/cm3 over his or her entire lifetime,that person would theoretically have no more than a one-in-a-million increased chance ofdeveloping cancer as a direct result of breathing air containing this chemical. Similarly,EPA estimates that breathing air containing 0.00004 fibers/cm3 would result in not greaterthan a one-in-a-hundred thousand increased chance of developing cancer, and aircontaining 0.0004 fibers/cm3 would result in not greater than a one-in-ten-thousandincreased chance of developing cancer. (5)

Physical PropertiesAsbestos is the name applied to a group of six different minerals that occur naturally in theenvironment. (1)The most common mineral type is white, but others may be blue, gray, or brown. (1)These minerals are made up of long, thin fibers that are somewhat similar to fiberglass.(1)Asbestos is neither volatile nor soluble; however, small fibers may occur in suspension in

8

both air and water. (1)

Health Data from Inhalation Exposure

ACGIH TLV--American Conference of Governmental and Industrial Hygienists' thresholdlimit value expressed as a time-weighted average; the concentration of a substance towhich most workers can be exposed without adverse effects. NIOSH REL--National Institute of Occupational Safety and Health's recommended exposurelimit; NIOSH-recommended exposure limit for an 8- or 10-h time-weighted-averageexposure and/or ceiling. OSHA PEL--Occupational Safety and Health Administration's permissible exposure limitexpressed as a time-weighted average; the concentration of a substance to which mostworkers can be exposed without adverse effect averaged over a normal 8-h workday or a40-h workweek.

The health and regulatory values cited in this factsheet were obtained in December 1999.a Health numbers are toxicological numbers from animal testing or risk assessment valuesdeveloped by EPA. b Regulatory numbers are values that have been incorporated in Government regulations, whileadvisory numbers are nonregulatory values provided by the Government or other groups asadvice. OSHA numbers are regulatory, whereas NIOSH and ACGIH numbers are advisory.

References

9

EPA Home Privacy and Security Notice Contact Us

http://www.epa.gov/ttnatw01/hlthef/asbestos.htmlPrint As-Is

Last updated on Tuesday, November 06, 2007

1. Agency for Toxic Substances and Disease Registry (ATSDR). Toxicological Profile forAsbestos (Draft). U.S. Public Health Service, U.S. Department of Health and HumanServices, Atlanta, GA. 1995.

2. E.J. Calabrese and E.M. Kenyon. Air Toxics and Risk Assessment. Lewis Publishers,Chelsea, MI. 1991.

3. U.S. Department of Health and Human Services. Hazardous Substances Data Bank (HSDB,online database). National Toxicology Information Program, National Library of Medicine,Bethesda, MD. 1993.

4. U.S. Department of Health and Human Services. Registry of Toxic Effects of ChemicalSubstances (RTECS, online database). National Toxicology Information Program, NationalLibrary of Medicine, Bethesda, MD. 1993.

5. U.S. Environmental Protection Agency. Integrated Risk Information System (IRIS) onAsbestos. National Center for Environmental Assessment, Office of Research andDevelopment, Washington, DC. 1999

6. National Institute for Occupational Safety and Health (NIOSH). Pocket Guide to ChemicalHazards. U.S. Department of Health and Human Services, Public Health Service, Centersfor Disease Control and Prevention. Cincinnati, OH. 1997.

7. Occupational Safety and Health Administration (OSHA). Occupational Safety and HealthStandards, Toxic and Hazardous Substances. Code of Federal Regulations. 29 CFR1910.1001. 1998.

8. American Conference of Governmental Industrial Hygienists (ACGIH). 1999 TLV's and BEIs.Threshold Limit Values for Chemical Substances and Physical Agents, Biological ExposureIndices. Cincinnati, OH. 1999.

10

United States Environmental Protection Agency | Office of Radiation and Indoor Air (6608J) | EPA 402-F-06-030 | April 2006 www.epa.gov/radtown/power-lines.html

Electric and Magnetic Field (EMF) Radiation from Power Lines Electric and magnetic fields (EMF) are invisible lines of force that surround any electrical device that is plugged in and turned on. EMF are made up of waves of electric and magnetic energy moving together (radiating) through space. Electric fields are produced by charges and magnetic fields are produced by the flow of current through wires or electrical devices. EMF is commonly associated with power lines. A person standing directly under a high-voltage transmission line may feel a mild shock when touching something that conducts electricity. These sensations are caused by the strong electric fields from the high-voltage electricity in the lines. They occur only at close range because the electric fields rapidly become weaker as the distance from the line increases.

Many people are concerned about potential adverse health effects. Much of the research about power lines and potential health effects is inconclusive. Despite more than two decades of research to determine whether elevated EMF exposure, principally to magnetic fields, is related to an increased risk of childhood leukemia, there is still no definitive answer. The general scientific consensus is that, thus far, the evidence available is weak and is “not sufficient to establish a definitive cause-effect relationship.”

In 1998, an expert working group, organized by the National Institutes of Health’s National Institute of Environmental Health Sciences (NIEHS), assessed the health effects from exposure to extremely-low-frequency EMF, like those you would find in a home with power lines close by. Based on studies about childhood leukemia that involved a large number of households, they found that power line frequency magnetic fields are a possible cause of cancer. The NIEHS working group also concluded that the results of EMF animal, cellular, and mechanistic studies do not confirm or refute the finding of the human studies.

Who is protecting you? In the U.S., there are no federal standards limiting occupational or residential exposure to power line EMF. About seven states set standards for the width of right-of-ways under high-voltage transmission lines because of potential for electric shock.

What can you do to protect yourself? People concerned about possible health risks from power lines can reduce their exposure by:

• Increasing the distance between you and the source – The greater the distance between you and the power lines the more you reduce your exposure.

• Limiting the time spent around the source – Limit the time you spend near power lines to reduce your exposure.

Resources You can explore this radiation source further through the resources at the following URL: http://www.epa.gov/radtown/power-lines.html#resources

We provide these resources on-line rather than here so we can keep the links up-to-date.

1307/24/2012

HOME LOANSDFI GUIDE TO

16

GUIDE TO HOME LOANS 1

Building a Strong Foundation 2 Beginning Your Journey Construction Crew Understanding Your Credit How Much Home Can You Afford? Understanding the Types of Mortgages Understanding Your Costs

Creating a Solid Structure 8 Shop Compare Mortgage Shopping Worksheet A Few Things to Remember

Window Shopping: Becoming a Savvy Borrower 12

Avoiding Financial Pitfalls Predatory Lending

Know Your Rights 14 It’s the Law; Know Your Rights! Primary Laws Regulating the Mortgage Industry

Final Walkthrough 16 Good Faith Estimate (GFE) Truth In Lending Statement (TIL) Disclosure SummaryHUD-1 Settlement Statement Before Signing Day Before You Leave: The Closing Closing Costs

Welcome Home 30 Protecting Your Home Investment Preventing/Avoiding Foreclosure

Securing a Line of Credit After Purchase 32Is A Home Equity Credit Line For You? Home Improvement Loan Getting a Written Contract Keeping Records Completing the Job: A Checklist Reverse Mortgages

Additional Tools 35Mortgage TermsLoan Comparison Worksheet Loan Document Checklist

YOUR GUIDE TO HOME OWNERSHIPWelcome to the Department of Financial Institutions (DFI) guide to home loans. Whether you’re buying your first home, considering a second mortgage, refinancing, or considering a reverse mortgage the loan process can be confusing and complicated. As you embark on one of the biggest financial decisions you’ll make in your lifetime, use this Guide to understand and to help navigate this process.

Washington State is a leader when it comes to passing and regulations that protect consumers and ensure sound business practices in the mortgage industry. This booklet was updated in April 2009. Visit http://www.dfi.wa.gov/consumers/education/home.htm to verify you have the most recent information regarding the mortgage industry.

Educating yourself can help you avoid common pitfalls and assist you in determining what type of home loan is best for you.

ABOUT DFI The Department of Financial Institutions licenses and regulates a variety of Washington State Financial Service providers such as banks, credit unions, mortgage brokers, consumer loan companies, money transmitters, payday lenders and securities broker-dealers and investment advisors. DFI also works to protect consumers from financial fraud.

17

GUIDE TO HOME LOANS2 GUIDE TO HOME LOANS 3

SECTION 1

BUILDING A STRONG FOUNDATION

Imagine building your house on the sand. When the first rainstorm blows through, your new house will most likely be washed out to sea. Without placing your house on a solid foundation you can not weather a disaster. Building a foundation of knowledge about the loan borrowing process is equally important. Here are five steps to help you begin your journey:

Beginning Your Journey 1 . Before you buy a home, attend a free homeownership

education course offered by a HUD-approved housing counseling organization or agency.

2. Gather all your financial documents; check your credit history and fix any blemishes on your credit before you apply for a loan.

3. Determine how much home you can truly afford.

4. Keep accurate notes; make a file and keep all loan documents and correspondence in that file.

5. Shop for a lender and compare costs. Be suspicious if anyone tries to steer you to just one lender. Contact the Washington State Department of Financial Institutions to ensure that you’re working with a licensed professional.

Construction CrewWhether you’re buying a home for the first time or refinancing a loan for the third time, it’s important to know who the main players are and what roles they play in the transaction.

Here are Some Initial Introductions:

Borrower: a person who has been approved to receive a loan and is then obligated to repay the loan, and any additional fees according to the loan terms.

Selling Agent: the real estate agent obtaining the buyer rather than listing the property. The listing and selling agent may be the same person or company.

Listing Agent: a real estate agent who represents the seller or buyer and works to find a listing.

Mortgage Broker: any person who, for compensation or gain, makes a residential mortgage loan or assists a person in obtaining or applying to obtain a residential mortgage loan.

Loan Originator: a person working directly for a mortgage broker or mortgage banker who takes a residential mortgage loan application or offers or negotiates terms of a mortgage loan, for direct or indirect compensation or gain.

Lender (a Bank, Credit Union, or Mortgage Bank): any person or entity loaning funds which are to be repaid.

Loan Officer: a person working directly for a bank or credit union who takes a residential mortgage loan application or offers or negotiates terms of a mortgage loan, for direct or indirect compensation or gain.

Title Company/Title Insurance Company: a company that issues an insurance policy that guarantees an owner has title to real property and can legally transfer it to someone else. A title policy may protect the mortgage lender, the home buyer, or both.

Appraiser: a qualified individual who uses his or her experience and knowledge to determine the value of a home and prepare the appraisal estimate.

Inspector: a designated agent who inspects and documents the physical condition of the property as described and verified in an inspection certificate.

Escrow Agent/Agency: the person or organization having a fiduciary responsibility to both the buyer and seller to see that the terms of the purchase/sale (or loan) are carried out. Often referred to as “closing” the loan, independent escrow agents, title companies, attorneys and even the lender may serve in this role.

Understanding Your Credit Credit provides a way to acquire merchandise or money with the understanding that you will repay the loan. Your history for paying your bills on time is collected by credit bureaus or credit-reporting agencies. These businesses gather, maintain, and sell information about consumers’ credit histories. They collect information about your payment habits from banks, credit unions, finance companies, or retailers.

Why is it Important? Generally lenders look at several things: your income, your down payment or equity, your credit history, how much money you’ve saved, and the property you plan to purchase or refinance. When studying your credit history, almost all lenders look at your credit score and your debt-to-income ratio. Lenders use credit scores, known as

FICO scores or VantageScore, as an important factor in the decision whether or not to offer credit. The scores can range from 300 to 900+ points.

Credit Problems? If you have a lower credit score, don’t assume that your choices are limited to high-cost loans. If your credit report contains negative information that is accurate but stemming from unique circumstances such as illness or temporary loss of income, be sure to explain your situation to the lender or broker. Take the time to shop around and negotiate the best deal for you. It may be that your past credit record is not as good as you might wish. If you’re currently having credit problems, you should work with a HUD-approved credit counseling organization or agency. Many offer credit counseling free of charge or for a nominal fee. Understand you may not be in a position to buy a house until your credit issues are resolved.

The Following Conditions Will Play a Factor in Your Mortgage Lender’s Decision to Provide You With a Loan:

Bankruptcy: In most cases, lenders prefer that you wait at least two years after a bankruptcy is dismissed before taking on another large debt such as a home loan. Bankruptcies can remain on your credit report for up to 10 years. It may be helpful for you to explain the circumstances of the bankruptcy to the lender.

Foreclosure: Having a foreclosure on your records doesn’t mean that you can never buy another house. The mortgage lender will, however, want to know the reasons for your foreclosure. Most lenders will expect you to wait three years after a foreclosure before you apply for a new mortgage.

Debts: Having too much debt may lower the chances for you to buy a home or refinance a mortgage. Making late payments or skipping payments will show as derogatory or negative items on your credit report. Taking steps to improve your credit record is one of the most important things you can do.

Credit Reports A consumer credit report is a document that contains a record of an individual’s credit payment history. The report contains four types of information: identifying information, credit information, public record information, and inquiries.

Identifying Information Includes:

you have with:

The information contained on your credit report remains for seven years from the date it’s first reported, and then cycles off automatically.

TIP: Consumers are allowed to order one free copy of their credit report. To order a copy of your credit report, contact www.annualcreditreport.comor

TIP: If you’ve been denied credit because of information on your credit report, the lender is required to provide you with the credit bureau’s name, address, and telephone number – and you’re entitled to a free copy of your report from that credit bureau. The credit reporting industry is regulated by the federal Fair Credit Reporting Act, which is administered by the Federal Trade Commission (FTC).

How Much Home Can You Afford? Determining how much you can afford is an important first step in shopping. How much will your monthly payments be? Take into consideration future changes in your household income. Are you anticipating a promotion at work that would increase your salary? Will you be adjusting from a double income family to a single income in the coming years? If the interest rate is adjustable - can you afford the larger payment if the rates increase?

Your debt-to-income ratio is the amount of debt payments per month divided by the amount of your income per month. This ratio helps lenders decide how large a monthly payment you can afford.

18


In addition to the lender knowing what you can afford, You must be comfortable with the size of your monthly payment. One way to do this is to utilize a mortgage calculator. This can be found on-line, and is an easy-to-use tool to help you determine how much you can afford.

Generally, your monthly housing expenses, including principal, interest, property taxes, and homeowners

monthly income; your total long term monthly obligations (such as housing expenses, car payments and insurance,

percent of your gross income.

Understanding the Types of Mortgages When searching for a type of mortgage, it’s important to choose the best loan program that fits your personal wants and needs. The right type of mortgage for you depends on many different factors, such as:

payment.

The best way to find the “right” answer is to discuss your current finances, your plans and financial prospects, and your preferences with a real estate or mortgage professional.

Here are Some Common Types of Mortgages You Should Know About:

Fixed-Rated Mortgage: A mortgage on which the interest rate stays the same for the term of the loan.

Adjustable Rate Mortgage (ARM): A mortgage in which the interest rate may periodically adjust based on a pre-selected index and a margin is an ARM. The ARM is also known as a variable rate mortgage. These types of loans may have lower monthly payments initially, but can result in negative amortization and/or higher monthly payments

occurs when the loan payments during a period do not cover the interest accrued that over time, resulting in a higher principle balance than the amount of the original loan.

Balloon (payment) Mortgage: Usually a short term fixed-rate loan that involves smaller payments for a certain period of time, and one large payment at the end of the term of the loan.

Blanket Mortgage: One mortgage securing several pieces of real estate.

Bridge Loan: A mortgage securing a piece of property which will be paid off upon securing a loan for an additional property.

Conventional loan: A mortgage not insured by the Federal Housing Administration (FHA) or guaranteed by the Veterans Administration (VA). This mortgage is not a subprime loan.

FHA Loan: A loan insured by the Federal Housing Administration, open to all qualified home purchasers, which requires a lower down payment – typically 3 percent – than a conventional loan. This program allows buyers who might not otherwise qualify for a home loan to obtain one because the risk is removed from the lender by FHA insurance. While there are limits on the amount of an FHA loan, they are typically generous enough to handle moderately priced homes almost anywhere in the country.

Interest Only Mortgage: A mortgage in which the borrower pays only interest on the principal of the loan for a set period of time, followed by a larger payment period that includes interest and principal payment, or a balloon payment.

Reverse Mortgage: A special type of home loan that lets a homeowner convert a portion of the equity in their home to cash. According to the Federal Trade Commission, there are three types of reverse mortgages:

state and local government agencies and nonprofit organizations.

Home Equity Conversion Mortgages (HECMs) and backed by the U. S. Department of Housing and Urban Development (HUD).

are backed by the companies that develop them.

Unlike a traditional mortgage loan, no repayment is required until the borrower no longer occupies the home as their principal residence. Borrowers must, in government-backed reverse mortgage products, be

and receive a certificate to verify they understand the loan terms.

Subprime Lender/Loans: A lender that provides credit to borrowers who do not meet prime underwriting guidelines and often charges a finance rate that is higher than the “prime” or normal rate offered to borrowers with good credit. Typically, it’s a lender that approves loans for individuals who may have poor

Be Sure to Obtain and Compare the Following Information from Each Lender and Mortgage Broker:

Rates

interest rates and whether the rates being quoted are the lowest for that day or week.

mind that when interest rates for adjustable rate loans go up, generally so does the monthly payment.

how your rate and loan payment will vary, including whether your loan payment will be reduced when rates go down.

six months, or annually) and how much it can change at each adjustment (yearly caps, lifetime caps).

Points

Points are any fees that the borrower pays that are based on a percentage of the loan amount.

Discount points are fees paid to the lender to reduce the interest rate on the loan. Ask to see exactly how much your rate will be dropped based on the amount of discount points you pay. For example, paying 0.50 percent of the loan amount in discount points may adjust the loan rate downwards by 0.25 percent. Each program and lender will use a different formula and the amounts of points will change daily as market rates change.

compare your short-term needs against your long-term needs. Here is an example based on $100,000, 30 year

WITH NO DISCOUNT

POINTS

WITH DISCOUNT

POINTS

$ Amount of Points $0 $250Intrest Rate

Monthly Payment

a month in your payment. Only you can determine if this is a beneficial trade off for you. Ask yourself whether you can afford the extra cash upfront right now and then note the following:

month you keep the loan after this point you will be

months this equates to $5,504.

2. Over the life of the loan, this $250 investment also

sections for information about current rates and points.

amount – rather than just as the number of points or percentage – so that you will actually know how much you will have to pay.

TIP: Ask about the loan’s APR. The APR takes into account not only the interest rate but also points, broker fees, and certain other charges that you may be required to pay, and is expressed as a yearly percentage rate. This will specifically tell you the cost of what you’re borrowing and will allow you to compare the costs of one loan to another. TIP: Document everything in writing. A daily journal of all conversations can be a powerful tool in resolving conflicts later. TIP:on any detail or feature of the loan. You have a right to receive commitments in writing and professionals involved should never hesitate to provide this. If your loan originator is unwilling to put promises in writing.You should not rely on verbal promises.

credit history or no credit history, or who have other characteristics that justify a higher rate. Keep in mind: because you’re approved for a subprime loan doesn’t mean that you cannot qualify for a prime rate loan from another lender. Be sure to explore your options.

VA Loan: Loans made to veterans that are guaranteed by the Department of Veterans Affairs;

Understanding Your Costs Down payments, rates, points, and fees can make a loan that looks good at first glance change into something else once all the facts are known. Knowing the amount of the monthly payment and the interest rate is not enough. Be sure to get information about potential loans from several lenders or mortgage brokers and find out all of the costs involved with a loan. When comparing loans, make sure you’re reviewing the same information in each loan such as loan amount, loan term, type of loan, monthly payment, penalties and features and annual percentage rate (APR).

19

GUIDE TO HOME LOANS GUIDE TO HOME LOANS

TIP:directly charge you any discount points because they don’t set the rate.

Fees

A home loan often involves many fees, such as loan origination fees, underwriting fees, broker fees, transaction, settlement, and third party costs. Every lender or broker must give you an estimate of its fees when you apply for a mortgage loan. Many of these fees are negotiable. Some fees are paid when you apply for a loan (such as application and appraisal fees), and others are paid at closing. In some cases, you can borrow the money needed to pay these fees, but doing so will

loans are sometimes available, but they usually involve higher rates.

the fee. Several items may be lumped into one fee.

understand. Some common fees associated with a home loan closing are listed on the Mortgage Shopping Worksheet (at the back of this workbook).

actual cost of service. Ask to see invoices if you feel you’re paying too much.

Down Payments and Private Mortgage Insurance

Some lenders require 20 percent of the home’s purchase price or value as a down payment or equity in the loan. This requirement is known as the Loan to Value or LTV. A

percent LTV. Your lender will tell you their LTV requirements for each type of loan.

Most lenders offer loans that require less than 20 percent down — sometimes as little as 0 percent on conventional loans. If a 20 percent down payment is not made, lenders usually require the borrower to purchase private mortgage insurance (PMI) to protect the lender in case the borrower fails to pay. When government-assisted programs such as FHA (Federal Housing Administration), VA (Veterans Administration), or Rural Development Services are available, the down payment requirements may be substantially smaller.

what you need to do to verify that funds for your down payment are available.

may offer.

If PMI is Required for Your Loan:

including the PMI premium.

how it can be removed.

Taxes and Insurance

Many lenders will require your monthly loan payment to include an additional amount to cover annual real estate taxes and homeowner’s insurance. The amount is deposited into an account commonly called a reserve or escrow account.

Be sure to ask if taxes and insurance payments are required to be escrowed to the lender or are optional. Typically, lenders will require monthly real estate taxes and homeowner insurance premiums to be escrowed if

When comparing monthly payments from various lenders, be sure to ask if the lender included monthly taxes and insurance costs in the total payment. If it’s included, ask for the costs to be broken down in the following manner:

20

GUIDE TO HOME LOANS

SECTION 2

CREATING A SOLID STRUCTURE

We’ve talked about how to build a strong foundation. In this section, we will cover the necessary resources that will make your journey more pleasant and free of obstacles.

When buying a home or refinancing a loan remember to shop around, compare costs and terms, and negotiate for the best deal.

Shop The newspaper and the Internet are good places to start shopping for a loan. Look for information on interest rates and points from several lenders or brokers. Since rates and points can change daily, you’ll want to check the local business section of the newspaper and various financial Web sites often when shopping for a home loan.

TIP: The promotional advertising may not list the fees associated with the loan, so be sure to ask the lenders about fees. TIP: Beware of some advertisements that may be formatted to look like a news article, rather than an advertisement.

The Mortgage Shopping Worksheet

This worksheet, at right on page 9, is also available by visiting DFI’s Web site. Please take it with you when you speak to each lender or broker and be sure to write down all the information you obtain. Don’t be afraid to make lenders and brokers compete with each other for your business by letting them know that you’re shopping around.

Loan Pre-Qualification vs. Loan Approval

Loan pre-qualification is a best guess at your housing and loan affordability. Pre-qualification is typically based upon a verbal conversation between potential borrowers and a lender and doesn’t include formal underwriting or supporting documentation. A loan pre-qualification is not a commitment to lend.

Loan approval comes after a formal underwriting of a borrower’s loan request. Loan approval is achieved with a complete mortgage loan application and typically includes these basic documents:

identification of all employment sources.

schedules and attachments such as W-2’s, 1099’s

and retirement statements.

owed to all creditors.

in employment history; and bankruptcy.

two years to include names and phone numbers of landlords.

TIP: It’s important not to make any changes to your financial condition during the loan process, including any major asset purchases, any new debts or changes in your employment. This will affect your approval rating.

Compare

Using the APR (annual percentage rate):

The APR, which takes into account the interest rate, points, broker fees, and certain charges that you may be required to pay, and is expressed as a yearly percentage rate, will allow you to compare similar loans (e.g. fixed to fixed, ARM to ARM) from the same or different lenders without analyzing fee and rate information. The APR is an interest rate that shows the true interest rate you will pay over the life of the loan, factoring in certain closing costs. Here is an example:

Assume that you’re comparing two, fixed rate 30-year mortgages for $100,000 with different interest rates and different amounts of lender fees:

LOAN #1 LOAN #2

Intrest RatePrepaid Finance Charges* $3,000 $2,500

APR 6.29% 6.49%

* Prepaid finance charges include a variety of costs to close the loan such as: lender fees, broker fees, interim interest, and escrow fees.

In this example, you only need the APR to determine that Loan #1 is the most cost effective loan offered. When comparing loans and lenders, your lender or broker should provide you with the APR on any loan discussed.

21


Calculators

Mortgage calculators are available online from a number of resources to help you compare and provide you with different scenarios that best fit your needs.

Questions to Ask Your Broker or Lender:

When Shopping for a Loan, You Should Ask:

total of all fees including the lender fees, third-party fees and transaction fees?

rate stays the same for the life of the loan, while an adjustable rate may change.)

Premium, how much it is, and who will receive it.

is refundable?

homeowners and mortgage insurance?

When You Apply For Your Loan Ask:

available? What are the fees?

if interest rates drop before closing?

and how many years are they in effect?

homeowners and mortgage insurance?

and a copy of the federal booklet on settlement costs? Insist that you get a copy of this document within 3 days of your loan application.

If the Loan is An Adjustable Rate Mortgage (ARM):

stay in effect?

that payment stay in effect?

well as over the life of the loan?

without doing a new loan?

it apply?

A Few Things to Remember1 . When you apply for a mortgage loan, every piece

of information that you submit must be accurate and complete. Lying on a mortgage application is fraud and may result in criminal penalties. Don’t let anyone persuade you to make a false statement on your loan application, such as overstating your income or the value of the home, the source of your down payment, failing to disclose the nature and amount of your debts, or even how long you’ve been employed.

2. It’s wise to ask to review your documents; request your loan documents one day before closing and have them reviewed by someone you trust or who is skilled in real estate law.

containing blanks. If someone else inserts information after you’ve signed, you may still be bound to the terms

through any blanks.

4. Read everything carefully and ask questions. Don’t

anyone pressure you into signing before you’ve read everything completely.

5. Don’t let anyone convince you to borrow more money than you know you can afford to repay. If you get behind on your payments, you risk a potential negative impact on your credit score, and losing your house and all of the money you’ve put into the property.

should know that the broker has a fiduciary relationship with the borrower. This means that, by law, the broker must act in the borrower’s best interest and in the utmost good faith toward the borrower, and shall disclose any and all business relationships to the borrower including, but not limited to, relationships with the lender who is underwriting your loan. Also, a broker may not accept, provide, or charge any undisclosed compensation to another party involved in the loan transaction.

22


in until months after you’ve begun to pay on your loan. Scrutinize your documents closely and make sure the loan you sign is the loan you agreed to.

Loan Flipping: A lender refinances your loan more than once with a new long-term, high cost loan. Each time the lender “flips” the existing loan, you must pay points and assorted fees.

Packing: You receive a loan that contains charges for services you did not request or need. “Packing” most often involves making the borrower believe that credit insurance or some other costly product must be purchased and financed into the loan in order to qualify. Sometimes the costs of these services may simply be hidden altogether.

Hidden Balloon Payments: You believe that you’veapplied for a low rate loan requiring low monthly payments only to learn at closing that it’s a short-term loan that you will have to refinance within a few years.

Hiding or Lying About Pre-Payment Penalties:You are led to believe that there will be no penalty if you decide to pay your loan off early.

Home Improvement Scams: A contractor talks youinto costly or unnecessary repairs, steers you to a high-cost mortgage lender to finance the job, and arranges for the loan proceeds to be sent directly to the contractor. In some cases, the contractor performs shoddy or incomplete work, and the homeowner is stuck paying off a long-term loan where the house is at risk.

Monthly Payment Scams: Don’t be tricked bydeceptive payment comparisons. Be particularly aware when comparing the new monthly payment to your existing monthly payment. Does the new payment contain amounts for taxes and insurance? If not, it may not be a better loan. Ask that the full payment amount be clearly expressed in writing.

Piggy Back Second Loans: Be very aware ofadditional loans offered or “snuck” into your loan transaction at the time of closing. If you did not ask for a second mortgage, home equity line of credit or credit card secured by your home, one shouldn’t be included in your closing papers.

As with any loan opportunity you’re considering, contact the Washington State Department of Financial Institutions (DFI) to ensure you’re working with a licensed professional.

SECTION 3

WINDOW SHOPPING – BECOMING A SAVVY BORROWER

Every year misinformed consumers become victims of predatory lending or loan fraud. Don’t let this happen to you! In this section we will warn you about the common financial pitfalls, how to avoid them and provide you with some alternatives.

Avoiding Financial PitfallsWhen you buy a house, you enter into a long-term financial obligation. You fill out papers and sign legal documents based on those papers. It’s important that you understand your responsibilities so that you won’t be a victim or a participant in fraud.

When you apply for a mortgage loan, every piece of information you submit must be accurate and complete. Anything less is considered loan fraud.

Unfortunately, there are people who may try to convince you to lie about your qualifications so they can illegally make money at your expense. These people will appear to be your friends, saying they’re trying to help you. They may downplay or deny the importance of complying with the law and suggest that it’s all just “red tape” that everyone ignores. Don’t allow yourself to be fooled.

BE SMART

understand it.

your assets, and your debts.

law and you have the right to know.

BE HONEST

and present.

DON’T BE DISCOURAGED

If your loan application is rejected, find out what the problem is and how it can be resolved. Maybe you need to look for a less expensive house, or save more money. Check to see if there is more affordable housing or community programs you might be eligible for to help you through your home buying process.

Predatory Lending Your best defense against illegal or unethical practices is to be informed.

A predatory loan is a dishonest loan. Predatory lenders offer easy access to money, but often use high-pressure sales tactics, inflated interest rates, outrageous fees, unaffordable repayment terms, and harassing collection tactics. Predatory lenders target those who have limited access to mainstream sources of credit. The elderly, military personnel and homeowners in low-income neighborhoods are often victims of predatory lending. But anyone can be a victim of a predator.

How to Avoid a Predatory Loan:

Finding the best loan is no different than making any other purchase. Be a smart shopper! Talk with a number of different lenders. Compare their offers. Ask questions and don’t let anyone pressure you into making a deal that you don’t feel comfortable with. If you don’t agree with the terms of the offer you always have the right to walk away. Ask questions until you understand the loan terms – even if you feel embarrassed for not knowing the answer.

TIP: In a refinance loan or second mortgage you have the right to cancel the loan. This is known as the Right of Rescission. The lender must allow you three days after the closing of your loan to change your mind. Use that three days wisely – if the loan is not for you, cancel it.

Common Predatory Lending Practices:

The lender makes a loan based upon the equity in your home, whether or not you can make the payments. If you cannot make payments, you could lose your home through foreclosure.

Bait-and-switch schemes: The lender may promiseone type of loan, interest rate, or costs, but switch you to something different at closing. Sometimes a higher (and unaffordable) interest rate doesn’t kick

23


SECTION 4

KNOW YOUR RIGHTS

Before signing any document or paying any money, you should carefully examine your requirements, resources available and the need for professional help. In this section we will provide you with a listing of current laws regulating the mortgage industry. It’s always recommended that you contact an attorney for any legal advice.

It’s The Law: Know Your Rights!

If A Loan:

at or after closing,

Contact the Washington State Department of Financial Institutions.

Primary Laws Regulating the Mortgage Industry

Federal Laws:

Equal Credit Opportunity Act (ECOA) Prohibits discrimination in lending. ECOA prohibits any creditor from discriminating against an applicant with respect to any aspect of a credit transaction based on sex, race, color, religion, national origin, disability or parental status.

Fair Credit Reporting Act (FCRA) Stipulates the requirements of users of credit reports and disclosure to consumers.

Fair Housing Act Provides protection against housing-related discriminatory practices based on sex, race, color, religion, national origin, disability or parental status.

Home Ownership and Equity Protection Act (HOEPA) Requires additional disclosures for certain types of high cost loans.

Real Estate Settlement Procedures Act (RESPA) Prohibits cost increasing abusive practices such as kickbacks and referral fees, and requires advance disclosure of settlement service costs through the use of a Good Faith Estimate (GFE), which is a good faith estimate of service costs associated with the mortgage loan. Also requires the use of a Uniform

Settlement Statement (“HUD-1”) that shows every cost the borrower will pay in conjunction with receiving the loan.

Truth-in-Lending Act (TILA) Requires disclosure of the cost of credit to the consumer and the terms of repayment.

Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (SAFE Act) Establishes a

residential mortgage loan originators to be licensed.

WA State Laws:

Mortgage Brokers Practices Act (RCW 19.146) is designed to promote honest and fair dealings and to preserve public confidence in the lending industry by preventing fraudulent practices by mortgage brokers and loan originators.

The Consumer Loan Act (RCW 31.04) authorizes higher interest rates to ensure credit availability to borrowers with higher than average credit risks that might otherwise be unable to obtain loans.

The Consumer Protection Act (CPA) prohibitsunfair and deceptive acts or practices in trade or commerce.

Escrow Agent Registration Act (EARA) requires strict handling of closing documents and the funds necessary for closing your loan.

Residential Mortgage Loan Disclosure (RCW 9.144.020) requires that borrowers are provided with a one page summary of all material terms of the loan.

The Regulatory Agencies:

24

GUIDE TO HOME LOANS GUIDE TO HOME LOANS

SECTION 5

FINAL WALKTHROUGH

Understanding disclosures during the home loan process is one area where consumers have the most questions. In this section, the most important aspects of the four main disclosures that you will be receiving during this process are reviewed.

Take the time to understand what you’re committing to before signing the loan papers. Be sure to ask your mortgage broker to explain anything that might seem confusing or unclear. The mortgage broker now has a “fiduciary responsibility” to protect your interests and advocate on your behalf. Don’t hesitate to ask their opinion about anything regarding the loan process.

At the beginning of the loan application process, within three days of your application, the lender or broker is required to provide you with an:

Then, as the closing date approaches, or sooner if any of the terms of the loan change, you will receive:

The remainder of this section will be devoted to illustrating and explaining these important documents.

25

GUIDE TO HOME LOANS

GOOD FAITH ESTIMATE (GFE)

The Good Faith Estimate (GFE), shown at right, shows the interest rate, term, loan amount, and all settlement costs on a particular loan. A GFE is sectioned into a range of

If you’re using a GFE to compare lenders and brokers,

this section are charged by third parties such as (but not limited to) appraisal, credit report, inspection, assumption, tax service and flood certification. These fees should be passed on to the borrower without any markup. A lender has complete control over fees such as origination and discount points, processing, underwriting and administrative fees. If this fee is higher then you were first quoted, find out why and negotiate a better fee if possible.

Items in the 900 and 1000 range list interest, taxes and premiums for mortgage, flood and hazard insurance. These items will vary depending on your closing date and are not negotiable. If you close in the beginning of the month, you will be prepay more interest than if you were to close at the end of the month. These items must be paid upfront or deposited into an Escrow account.

The 1100 section lists the Title and Escrow charges. Your Escrow fees may be negotiable if you plan early with the lender to know who was selected as your settlement agent. Once you know this information, you can contact the settlement agent and negotiate your closing fees. In any case, it is still a good idea to ask for lower fees.

And finally, the 1200 and 1300 section consist of your government fees such as the city and county tax stamps, recording fees and pest inspections.

TIP: Sometimes the fees listed on the Good Faith Estimate can change before closing. Some reasons include:

your loan application to a different lender, either to get a better rate or because the underwriter at the first lender didn’t approve your loan. Different lenders have different fees.

lender, some lenders charge a fee for that.

different loan amount.

than estimated.

insurance company, policy, or deductible amount.

On the GFE you will notice some letters at the end of line

Charge. These are the charges that are associated with calculating APR (see the Truth in Lending for more info on the APR). S means Seller Paid. These are items that the seller will be paying at closing. The F means FHA allowable. These items are permitted by FHA. Lastly the POC stands for Paid Outside of Close. This means that these items will be paid for, generally, before close. Some common items that are paid outside of close would be appraisal fees, homeowner’s insurance premiums and homeowner’s association dues. On some GFE’s these letters may simply be filled in after the dollar amounts of each fee.

Have each mortgage professional go over the Good Faith Estimates with you. Compare the items line by line. If you notice the cost of any item on a GFE significantly higher or lower than that of the same item on other GFE’s, ask the loan originator to explain the difference. Some dishonest loan originators might “low ball” their settlement costs to gain your business.

State and Federal law requires lenders and brokers to provide a written good faith estimate within three days after taking an application from a borrower.

26

GUIDE TO HOME LOANS20

The Truth-In-Lending (TIL) Disclosure Statement is shown at right. The purpose of the TIL is to show you the estimated total costs of borrowing, the expected payment amounts over the life of the loan, whether the loan has a pre-payment penalty, and other significant features of your loan.

Now Let’s Look at Some of Key Sections of the Truth In Lending Disclosure Statement:

Annual Percentage Rate (APR)The APR is the annual cost of the loan in percentage terms that take into account various charges paid by the borrower wherein interest on the loan is only a part of the charges.

The purpose of an APR is to allow you to quickly compare the total costs between competing loans without having to analyze all of the individual costs within each loan.

For Example:

seems to have a higher cost however, because the APR is lower it will provide a lower total cost to you in the long run. Comparing APR’s on loans is a quick way to determine the cost of each loan.

Finance ChargeThis is the sum of the lender charges that are incurred at the time the loan is written. The greater these charges, the higher the APR on the loan.

Amount Financed This is the amount provided to the borrower or used on the borrower’s behalf. This is the principal loan amount less the prepaid finance charges.

Total of Payments Total of payments to be made toward principal, interest, prepaid finance charges, and mortgage insurance (if applicable), over the life of the loan. The total of payments in the payment schedule will also equal this amount.

Payment Schedule This is the break down of the number and amounts of payments that will be due under the stated conditions of the loan at the time the loan is made.

Variable Rate FeatureA loan with a variable rate feature, also known as an Adjustable Rate Mortgage (ARM), will have payment adjustments that will occur per the terms agreed on in the note.

InsuranceThe insurance section will identify any insurance required (home owner property insurance or flood insurance) or any credit life and credit disability insurance the borrower has indicated a desire to purchase. Credit life and credit disability are an additional cost to the borrower and cannot ever be a requirement for obtaining a loan.

Prepayment The prepayment section indicates if the borrower has to pay or does not have to pay a penalty for paying off the principal balance of the loan prior to a stated period of time in the note agreement. This section also identifies if the borrower will receive a refund of any of the finance charges if the loan is paid off early.

TRUTH-IN-LENDING DISCLOSURE (TIL)

27


The Washington State Disclosure Summary is shown at right. This document is required by law in Washington when purchasing a new home with a residential mortgage loan. This form brings together information from the Good Faith Estimate (GFE) and the Truth in Lending (TIL) documents. Your lender or broker is required to provide you a copy of this disclosure within three days of

“significant changes” a revised copy needs to be provide to you.)

The one page disclosure summary may be arranged differently from the example to the right, but must contain the same elements in such a way that is easy to read and understand.

First make sure you have the right disclosure. There is one for fixed rate loans and one for adjustable rate loans. Your name and property address should be at the top of the form, and below this should be the terms of your loan. This section must include the length of the loan in years, the loan amount, the interest rate and payment amount.

Monthly reserves are items added to your monthly payment which your lender holds in a separate account, an escrow account, to pay items such as real estate taxes, homeowners insurance, mortgage insurance, and/or homeowner’s association dues. The form should reflect which ones are included and which ones are not.

Tip:escrow account. You may have to pay them on your own.

All fees charged by the lender or broker must be on this form and should match the fees of the same name

Underwriting, processing and other fees paid to the lender will be disclosed as “Other Fees.” Fees paid for services other than to the lender or the broker, such as appraisal or inspection fees, will not be included in this figure.

The disclosure also must tell you if there is prepayment penalty, a lump sum balloon payment due at the end, if your interest rate is locked, whether your rate or fees are higher due to reduced documentation and if your broker is receiving a YSP.

WASHINGTON STATE DISCLOSURE SUMMARY

If any of the information on this page has “Significant Changes” then redisclosure is required. “Significant Changes” include a change in:

included in the loan payment.

reduced documentation.

percent or more.

eighth of one percent.

adjustable to fixed.

dollars or more.

If you need help understanding your loan contact DFI at

28


Page 1 of the HUD-1 Settlement Statement is shown at right. This statement is like a receipt for your home purchase or refinance. It shows you what you bought, and who you bought it from. Typically, the closing agent gathers the pertinent information, completes the Settlement Statement and disperses the required funds once the buyer and seller have certified the accuracy of the statement by signing it. The Settlement Statement has the same numbering system as your Good Faith Estimate to keep it uniform and easy to understand.

TIP: It’s very important that you verify all the loan

loan origination fee or other broker/lender fee has increased from the final Good Faith Estimate, find out why it was not disclosed to you until closing day.

The first page of the Settlement sheet is broken down into a summary of the borrower’s (buyer) transaction on the left side and a summary of the seller’s transaction on the right. The second page is divided into those costs that are “paid from borrower’s funds at settlement” and those costs that are “paid from seller’s funds at settlement”. If buyer, seller, and title agent agree that the statement is true and accurate, all parties sign and date the sheet toward the bottom of page two.

The following key sections of the HUD-1, shown at right, should be thoroughly reviewed by you prior to signing any paperwork at closing:

Borrower’s/Seller’s Transaction:

Line 101 – Lists the contract price as stated in the Purchase and Sale Agreement.

Line 103 – Total settlement charges to the borrowers; this is obtained from adding up all of the costs on the second page and is shown as a subtotal on Line 1400.

Line 120 – This is the total amount due from the borrower inclusive of the contract price, costs listed on page two of the sheet and adjustments for taxes and other items pad by seller in advance.

Line 220 – States the total amount paid by or for borrowers including deposit monies, principal loans(s) and Seller Assistance.

HUD-1 SETTLEMENT STATEMENT

Line 303 – The figure here is the total amount of funds (in cash or certified check) that borrower needs to bring to settlement in order to close the transaction. If your transaction is a refinance to get cash out, you will find the amount you are to receive here.

29

GUIDE TO HOME LOANS

How to Compare the GFE to the HUD-1The line items on the GFE can be compared to the line

the same comparison for each item on the two forms.

LINE NO. FEE GFE AMOUNT HUD-1AMOUNT

Loan origination $2,000.00 $2,500.00

902Mortgage Insurance Premium

$1,000.00 $1,000.00

1101 Settlement $300.00 $300.00

1201 Recording $25.00 $25.00

1302 Pest Inspection $200.00 $200.00

origination fee is $2,000. However the HUD-1 Settlement Statement lists $2,500 – a difference of $500! You have the right to know why you are being asked to pay $500 more than what you were initially quoted. Insist on an explanation as to the difference. You are never required to accept a loan that is different from what you expected. There should be no surprises at this late date. If the fees are substantially different, don’t sign any documents unless you agree with the new terms.

PAGE 2 OF THE HUD-1 SETTLEMENT STATEMENT IS SHOWN AT RIGHT.

agent or broker.

such as origination fees, appraisal fee, credit report fee, various lender and broker fees, administration fees, and flood certification fee are listed.

Lines 901 – 905 – Any amounts that are required by the lender to be paid in advance, such as daily interest, are set forth here. For example, if Buyer settles on May 20,

Lines 1001-1009 – All reserves that the lender requires to be set aside in an escrow account such as hazard insurance, county taxes, and school taxes are set forth.

Lines 1101 – 1113 – Includes all charges associated with the Buyer’s title insurance such as the insurance premium and overnight wire fee.

Lines 1201 – 1203 – Details the recording fees charged by the county to record the deed and mortgage and sets forth the proportionate share of the real estate transfer taxes for Buyer and Seller.

Adjustments to Costs Shared By Buyer and SellerAt settlement it is usually necessary to make an adjustment between buyer and seller for property taxes and other expenses. The adjustments between buyer and seller are shown on the left and right side of page 1 on the Settlement Statement.

Similar adjustments are made for homeowner’s association dues, special assessments, and utilities. Be sure you work out these cost sharing arrangements or “pro-rations” with the seller and settlement agent before the actual day of settlement. Typically these fees are agreed upon in writing through the negotiation of your Purchase & Sales Agreement.

30

GUIDE TO HOME LOANS GUIDE TO HOME LOANS 29

FINAL CONSIDERATIONS

The decisions you make at closing may be with you for the life of the loan. Even at this late date you can negotiate terms or seek advice from your realtor, an attorney or your local housing authority in making a final decision. The bottom line is the final decision lies with you.

Here are several things to consider before your signing day.

Before Signing Day:

completed documents – such as the settlement

Addendums and Riders – at least one day before your appointment to sign your loan.

trusted family member or friend to review all documents. Make sure that you understand all the terms of the loan.

rate correct?

taxes and insurance?

years? or even 40 years or longer?

payment? If you are unsure of the impact of these features, contact a non-profit housing agency or a lawyer.

should receive an ARM Disclosure or Rider. Review this document. Make sure you understand how often your rate can increase, how much your payment can increase, when the rate will go up, and what the maximum interest rate and the maximum monthly payments will be.

charging anything other than a mortgage broker fee? For example, are they also charging a processing fee, an underwriting fee, or some other kind of fee of which you were unaware?

Premiums are fees that lenders pay to mortgage brokers when they sell you a higher interest rate. If you see a YSP on your HUD-1 settlement statement, you may not be receiving the lowest interest rate that was available to you or you may be paying the broker more than you agreed. You ultimately are paying for that YSP through your interest rate. Be sure to ask your escrow agent even if you don’t see one.

TIP: Be sure to request a copy of your property appraisal from your broker, federal law gives you a right to receive a copy.All these documents plus others you received at closing make up your personal loan file. Keep these together with all other items relating to your home in a safe place.

Before you Leave the Closing, Be Sure You Receive Copies of:

If you’re refinancing or getting an equity line of credit, you have three days to change your mind after you sign the loan documents. If you decide you don’t want the loan within this 3-day “rescission” period, you can simply walk away with a written notification. Provide a signed copy

document among your closing papers. If you do rescind the loan, the lender must give you back any money you paid out in the transaction, even money you paid to other parties.

Within one-week of signing your loan documents, you should receive a final HUD-1 settlement statement in the mail. If you don’t receive this information, contact your escrow agent immediately. This document is your official accounting of all money paid. Review this final statement closely and make sure nothing has changed.

Closing CostsClosing costs are all the different charges that you’ll be required to pay at or before the closing. They include charges related to the purchase of your home, and charges related to getting a mortgage. Depending on the specific circumstances of your particular loan, closing costs typically run between three and five percent of the loan amount.

Charges by the Lender May Include:

Charges Collected by the Title Company or Settlement Agent Include:

close your loan. In a purchase, some of these costs may be shared with the seller.

There may be other charges for services provided by either your lender or the closing company. Your lender or mortgage broker can give you more specific information on these costs. Remember, when you budget for your purchase, you should include the prepaid and financed closing costs, in addition to the purchase price, so that you can be sure that you can afford the house.

TIP: To decrease the amount of money you’ll need to pay at closing, ask to schedule the closing at the end of the month. For example: If you close on January 31st, your first payment will still be March 1st, but you’ll only need to pay the interest for that one day at the time of closing. Your first payment will only be a month and a day away, instead of almost two months away, but you’ll need less money at the closing.

31


SECTION 6

WELCOME HOME

it’s time to welcome your family and prepare for the house warming party.

Protecting Your Home Investment 1 . Limit your use of consumer credit cards. Avoid high cost

purchases. Live within your means.

2. If you fall into debt, talk to a mortgage counselor before you apply for a loan. Avoid adding credit card debt to your mortgage.

3. Think twice about including a car payment in a mortgage refinance. Do you want to make payments on your car over 30 years?

4. Considering life insurance? Talk to a financial planner. Mortgage Life Insurance products pay your lender but your loved ones don’t receive a penny

5. Thinking about refinancing? Don’t just look at your loan payments – look at the life of your loan. For example, refinancing with another 30-year mortgage may lower your monthly payment but it also means another 30 years of payments. Perhaps a 15-year loan would best meet your needs.

be bombarded with credit offers. Choose your credit accounts wisely. Always read the fine print. There is no free money – just clever advertising.

replacement. Consult an insurance specialist about coverage for your home’s contents, replacement costs, and liability insurance.

Preventing Foreclosure If you fall behind in your monthly house payments, the seller or lender may try to take the house back. This is generally called foreclosure. If a house is foreclosed, you may lose not only your house, but also all of the money you’ve invested. A foreclosure or a deficiency judgment could seriously affect your ability to qualify for credit in the future. Avoid this if at all possible.

Ways That You Can PREVENT Foreclosure:

Early intervention is the key! If you’re having trouble making your monthly mortgage payments, contact your lender immediately. Don’t wait!

Don’t ignore letters from your lender. Clearly explain your situation. Write down who you spoke to, the date, and what was said.

Be prepared to provide your lender with your current financial information, such as your monthly income and expenses.

You can stop the foreclosure by making up any delinquent payments plus any costs related to the foreclosure.

Remember to use registered or certified mail in all your correspondence on legal matters.

What Are Your Alternatives?

Special Forbearance. Your lender may be able to arrange a repayment plan that would be based upon your current financial situation and may even provide for a temporary reduction or suspension of your payments. You may qualify for this if you’ve recently experienced an involuntary reduction in income or an increase in living expenses.

Mortgage Modification. You may be able to refinance the debt and extend the term of your mortgage loan. This will help you catch up by possibly reducing the monthly payments to a more affordable level. You may qualify if you’ve recovered from a financial problem but your net income is less than it was before the default.

Partial Claim. Your lender may be able to work with you to obtain an interest-free FHA loan from HUD to bring your mortgage current, if you qualify.

Pre-Foreclosure Sale. This will allow you to sell your property and pay off your mortgage loan to avoid foreclosure and damage to your credit rating. If you’re unable to afford the house long-term, you may sell the house yourself before the foreclosure sale and save some of your equity.

Short Sale. A sale in which the lender agrees to accept a sale price less than the outstanding balance of the loan.

Deed-in-lieu of Foreclosure. As a last resort, you may be able to voluntarily “give back” your property to the lender. This won’t save your house, but may help your chances of getting another mortgage loan in the future.

TIP: If you’re a senior citizen or are disabled and are facing a foreclosure action because of unpaid property taxes or special assessments, you may be eligible to postpone payment of your property taxes or special assessments under two programs in Washington. Contact your local County Assessor’s Office or an attorney for more information. TIP: Lenders don’t have to accept all proposals and are not obligated to do so. So don’t wait till the last minute to contact your lender. TIP: If the lender refuses to take partial payments, you should put this money aside to help negotiate with the lender later. TIP: The foreclosure process will continue despite the possibility of a workout agreement. Therefore, you should not wait to hear back from the lender. You should contact the lender early and try and come up with a solution as soon as possible.

How Do You Know If You Qualify For Any Of These Alternatives?

Contact your local housing counseling agency for help in determining which, if any, of these options may meet your needs. You should also discuss the situation with your lender.

Should You Be Aware Of Anything Else?

Beware of scams! Solutions that sound too simple or too good to be true usually are. If you’re selling your home without professional guidance, beware of buyers who try to rush you through the process. Unfortunately, there are people who may try to take advantage of your financial difficulty. Be especially alert to the following:

Equity skimming. This type of scam involves a “buyer” approaching you and offering to pay off your mortgage or give you a sum of money when the property is sold. The “buyer” may suggest that you move out quickly and deed the property to him or her. The “buyer” then collects rent for a time, doesn’t make any mortgage payments, and allows the lender to foreclose. Remember that signing over your deed to someone else doesn’t necessarily relieve you of your obligation on your loan.

Phony Counseling Agencies. Some groups calling themselves “counseling agencies” may approach you and offer to perform certain services for a fee. These could well be services you could do for yourself, for free, such as negotiating a new payment plan with your lender, or pursuing a pre-foreclosure sale. If you have any doubt about paying for such services, call a HUD-approved housing counseling agency. Do this BEFORE you pay anyone or sign anything.

Precautions You Can Take

Take Precautions to Avoid Being “Taken” By a Scam Artist:

Don’t sign any papers you don’t fully understand. Make sure you get all the “promises” in writing. Signing over the deed to someone else doesn’t necessarily relieve you of your loan obligation. If your name is still included on the documents, you’re still liable for repaying the loan. Check with your lawyer or your mortgage company before entering into any deal involving your home. Check to see if there are any complaints against the prospective buyer if you’re selling your house. You can contact Washington State’s Attorney General’s Office or the Real Estate Commission for this type of information.

Points You Should Remember Don’t damage your credit rating by losing your home. If you get behind on your payments, call or write your mortgage lender immediately. Stay in your home to make sure you qualify for assistance. Arrange an appointment with a housing counselor to explore your options. Cooperate with the counselor or lender trying to help you. Explore every alternative to losing your home. Beware of scams.

32


SECTION 7

SECURING A LINE OF CREDIT AFTER PURCHASE

Here is a heads up on what can be done after the purchase of your home relative to financing, refinancing, or obtaining an equity line of credit. It’s important for you to understand that your home investment can bear you fruits for a future expansion, remodel, a consolidation loan or long awaited vacation. Let’s see how it works:

Is A Home Equity Credit Line for You?

If you need to borrow money, home equity lines may be one useful source of credit. Initially, they may provide you with large amounts of cash at relatively low interest rates. And they may provide you with certain tax advantages unavailable with other kinds of loans.

At the same time, home equity lines of credit require you to use your home as collateral for the loan. This may put your home at risk if you’re late or cannot make your monthly payments. Those loans with a large final payment may lead you to borrow more money to pay off this debt, or they may put your home in jeopardy if you can’t qualify for refinancing. And, if you sell your home, most plans require you to pay off your credit line at that time. In addition, because home equity loans give you relatively easy access to cash, you might find you borrow money too freely.

How much money can you borrow on a home equity line of credit (HELOC)? Depending on your creditworthiness and the amount of your outstanding debt, home equity lenders may let you borrow up to 100 percent of the appraised value of your home minus the amount you still owe on your first mortgage. Ask the lender about the length of the home equity loan, whether there is a minimum withdrawal requirement when you open your account, and whether there are minimum or maximum withdrawal requirements after your account is opened. Inquire how you can gain access to your credit line – with checks, credit cards, or both.

Also, find out if your home equity plan sets a fixed time – a draw period – when you can make withdrawals from your account. Once the draw period expires, you may be able to renew your credit line. If you can’t, you won’t be permitted to borrow additional funds. Also, in some plans, you may have to pay your full outstanding balance. In others, you may be able to repay the balance over a fixed time.

What safeguards are built into the loan? One of the best protections you have is the Federal Truth in Lending Act discussed earlier, which requires lenders to inform you about the terms and costs of the plan at the time you’re given an application. Lenders must disclose the APR and payment terms and must inform you of charges to open or use the account, such as an appraisal, a credit report, or attorneys’ fees. Lenders also must tell you about any variable rate feature and give you a brochure describing the general features of home equity plans.

The Truth in Lending Act also protects you from changes in the terms of the account before the plan is opened. If you decide not to enter into the plan because of a change in terms, all fees you paid earlier must be returned to you.

Because your home is at risk when you open a home equity credit account, you have three days after you receive the closing papers to cancel the transaction, for any reason. To cancel, you must inform the lender in writing. Upon timely cancellation, your credit line must be cancelled and all fees you’ve paid must be returned.

Questions to Ask Before You Sign the Dotted Line:

What is the interest rate on the HELOC?

What is the index and margin that affect the interest rate?

What are the upfront closing costs? Is there an annual fee?What are the repayment terms during the loan?

Home Improvement Loan

Understanding Your Payment Options

You have several payment options for most home improvement and maintenance and repair projects. For example, you can get your own loan or ask the contractor to arrange financing for larger projects. For smaller projects, you may want to pay by check or credit card. Avoid paying cash. Whatever option you choose, be sure you have a reasonable payment schedule and a fair interest rate. Here are some additional tips:

Try to limit your down payment. Some state laws limit the amount of money a contractor can request as a down payment. Try to make payments during the project contingent upon satisfactory completion of a defined amount of work. This way, if the work is not proceeding according to schedule, the payment is also delayed.

Lien laws may allow subcontractors or suppliers to file a mechanic’s lien against your home to satisfy their unpaid bills. Don’t make the final payment or sign an affidavit of final release until you’re satisfied with the work and know that the subcontractors and suppliers have been paid. Some state or local laws limit the amount by which the final bill can exceed the estimate, unless you’ve approved the increase. If you have a problem with merchandise or services that you charged to a credit card, and you’ve made a good faith effort to work out the problem with the seller, you have the right to withhold payment for the merchandise or services. Contact your card issuer for details on how this service is administered. You may be able to withhold payment up to the amount of credit outstanding for the purchase, plus any finance or related charges.

The “Home Improvement” Loan Scam A contractor calls or knocks on your door and offers to install a new roof or remodel your kitchen at a price that sounds reasonable. You tell him you’re interested, but can’t afford it. He tells you it’s no problem — he can arrange financing through a lender he knows. You agree to the project, and the contractor begins work. At some point after the contractor begins, you’re asked to sign a lot of papers. The papers may be blank or the lender may rush you to sign before you have had time to read what you have been given to sign. You sign the papers. Later, you realize that the papers you signed are a home equity loan. The interest rate, points and fees seem very high. To make matters worse, the work on your home isn’t done right or hasn’t been completed, and the contractor, who may have been paid by the lender, has little interest in completing the work to your satisfaction.

You can protect yourself from inappropriate lending practices. Here’s how.

Don’t:

Agree to a home equity loan if you don’t haveenough money to make the monthly payments. Sign any document you haven’t read or any documentthat has blank spaces to be filled in after you sign. Deed your property to anyone. First consult an attorney, a knowledgeable family member, or someone else that you trust.

Agree to finance through your contractor without shopping around and comparing loan terms.

Getting a Written Contract A contract spells out the “who, what, where, when” and cost of your project. The agreement should be clear, concise and complete.

Before You Sign a Contract, Make Sure it Contains:

The contractor’s name, address, phone, and license number. The payment schedule for the contractor, subcontractors and suppliers. An estimated start and completion date. The contractor’s obligation to obtain all necessary permits. How change orders will be handled. A change order – common on most remodeling jobs – is a written authorization to the contractor to make a change or addition to the work described in the original contract. It could affect the project’s cost and schedule. A remodel often requires payment for change orders before work begins. A detailed list of all materials including color, model, size, brand name, and product. Warranties covering materials and workmanship. The names and addresses of the parties honoring the warranties – contractor, distributor or manufacturer – must be identified. The length of the warranty period and any limitations also should be spelled out. What the contractor will and will not do. For example,is site clean up and trash hauling included in the price? Ask for a “broom clause.” It makes the contractor responsible for all clean-up work, including spills and stains. Oral promises also should be added to the written contract. A written statement of your right to cancel the contract within three business days if you signed it in your home or at a location other than the seller’s permanent place of business. During the sales transaction, the salesperson (contractor) must give you two copies of a cancellation form (one to keep and one to send back to the company) and a copy of your contract or receipt. The contract or receipt must be dated, show the name and address of the seller, and explain your right to cancel.

33


Keeping Records Keep all paperwork related to your project in one place. This includes copies of the contract, change orders and correspondence with your home improvement professionals. Keep a log or journal of all phone calls, conversations and activities. You also might want to take photographs as the job progresses. These records are especially important if you have problems with your project – during or after construction.

Completing the Job: A Checklist Before you sign off and make the final payment, use this checklist to make sure the job is complete. Check that:

All work meets the standards spelled out in the contract.

You’ve written warranties for materials and workmanship.

Proof that all subcontractors and suppliers have been paid.

The job site has been cleaned up and cleared of excess materials, tools and equipment.

You’ve inspected and approved the completed work.

Reverse Mortgages

a reverse mortgage may be an option to help supplement your income. However, because your home is such a valuable asset, you may want to consult with your family, attorney, or financial advisor before applying for a reverse mortgage. Knowing your rights and responsibilities as a borrower may help to minimize your financial risks and avoid any threat of foreclosure or loss on your home.

How Reverse Mortgages Work

A reverse mortgage is a loan where a lender pays you a monthly advance, a line of credit, or a combination of both while you continue to live in your home. The amount you’re eligible to borrow generally is based on your age, the equity in your home, and the interest rate the lender is charging. Funds you receive from a reverse mortgage may be used for any purpose.

With a reverse mortgage, you retain title to your home. You are responsible for maintaining your home and paying all real estate taxes. Depending on the plan you select, your reverse mortgage becomes due with interest when you move, sell your home, reach the end of a pre-selected loan period, or die. When you die, the lender

doesn’t take title to your home, but your heirs must pay off the loan. Usually, selling the home or refinancing the property repays the debt.

Facts to Consider About Reverse Mortgages

Reverse mortgages are rising-debt loans. The interest is added to the principal loan balance each month, because it’s not paid on a current basis. The amount you owe increases over time as the interest compounds. Some reverse mortgages have fixed rate interest; others have adjustable rates that can change over the lifetime of the loan. Reverse mortgages use some or all of the equity in your home, leaving fewer assets for you and your heirs. The three types of reverse mortgages – FHA insured, lender-insured, and uninsured – vary according to their costs and terms. Check the features of each to select the type that is best suited for your needs. Before considering a reverse mortgage, consult with family members, your attorney, or financial advisor. Reverse mortgages typically charge loan origination fees and closing costs. Insured plans charge insurance premiums and some plans have mortgage servicing fees. You may be able to finance these costs if you want to avoid paying them in cash. But, if you finance the costs, they will be added to your loan amount and you will pay interest on them. Your legal obligation to repay the loan is limited by the value of your home at the time the loan is repaid. This would include any appreciation in the value after your loan began.

There are various reverse mortgage plans offered. Consult your attorney or financial advisor about the tax consequences of the particular plan you’re considering.

Reverse Mortgage Safeguards

The Federal Truth in Lending Act (TILA) is one of the best protections you have with a reverse mortgage. TILA requires lenders to disclose the costs and terms of reverse mortgages. This includes the Annual Percentage Rate (APR) and payment terms. If you choose a credit line as your loan advance, lenders also must tell you of charges related to opening and using your credit account.

You are entitled to counseling from a federally-approved reverse mortgage counselor if you apply for a reverse mortgage, so be sure to take advantage of that!

MORTGAGE TERMS

Annual Percentage Rate (APR): Cost of the credit, which includes the interest and all other finance charges.

the interest rate you were quoted, there are significant fees being added to the loan.

Points: Fees paid to the lender for a lower interest rate.

should be paid at the time of the loan.

Prepayment Penalty: Fees required to be paid by you if the loan is paid off early. Try to avoid any prepayment penalty unless you are very sure that you will hold the loan for longer than the pre-payment penalty period. In the State of Washington, pre-payment penalties are not allowed on second mortgages.

Balloon Payment: Large payment due at the end of a loan. This happens when a borrower has a low monthly payment covering only interest and a small portion of the principal, leaving almost the whole loan amount due in one payment at the end. If you cannot make this payment, you could lose your home.

Yield Spread Premium (YSP): Payment to the broker for selling a higher interest rate loan than would otherwise be charged for that borrower. It must be disclosed to the borrower at the time of the loan and is generally acceptable if there are no other broker fees and this is how the broker is getting paid for his or her services.

Appraisal: A determination of the value of a home by a third party who is hired by the lender to assure the home has enough value to pay off the loan should the borrower default. It is typically paid for by borrower.

Loan Origination Fees: Fees paid to the lender for handling the paperwork in arranging the loan. These are prepaid finance charges paid at the loan closing and are included in your APR calculation.

Mortgage Broker Fees: Fees paid to the mortgage broker for handling the paperwork for arranging the loan.

Escrow: The holding of money or documents by a neutral third party prior to closing. It can also be an account held by the lender (or servicer) into which a homeowner pays money for taxes and insurance.

Interest Rate: is the cost of borrowing money expressed as a percentage rate.

Lock-In: A written agreement guaranteeing a home buyer a specific interest rate on a home loan provided that the loan is closed within a certain period of time, such as

number of points to be paid at closing.

Private Mortgage Insurance (PMI): Insurance that protects the lender against a loss if a borrower defaults on the loan. It is usually required for loans in which the down payment is less than 20 percent of the sales price or, in a refinancing when the amount financed is greater

34

DOCUMENT NAME DOCUMENT DESCRIPTION (CHECK ) if buyer has a copy

REQUEST COPY FROM

Promissory Note Borrowers acknoledgement of loan and promise ro repay Lender

Deed of Trust Records lien and grant powers to trustee incase of defualt Lender

Rider(s) Adds additional loan terms/restrictions Lender

Washington Disclosure Summary

Required on purchase Transactions,contains important loan details.

Lender or Broker

Good Faith Estimate Preliminary estimate of fees and funds Re-disclosure of estimated fees Lender or Broker

Second Good Faith Estimate Required if there are major changes to the intial one

Truth in Lending Disclosure Shows repayment schedule and total amount you will have paid in the end Lender or Broker

Three Day Right of Rescission (equity or refinance loans only) (not applicable in purchase transaction)

Notice of borrower’s right to cancel the transaction during the 3 days after loan signing

Lender

Estimated HUD-1 Ecsrow agent’s estimate of costs and funds to be distrubed Escrow Agent

Final HUD-1 Final accountingof costs and funds to be disbursed Escrow Agent

Credit Report (not required to be provided to borrower but can be requested)

Three-bureau credit decision Lender or Broker

Lock-in Agreement Shows whether the rate was locked and if so, what the rate was Lender or Broker

Servicing Disclosure Disclosure to the borrower whether the lender intends to sell the loan Lender or broker

Insurance Disclosure (if applicable)

Discloses any insurance products that were sold to the barrower in conjunction with the loan

Lender

Broker Disclosure Broke’s agreement to provide a servce and what cost (only applicable when broker was used)

Broker

Affiliated Business Disclosure Required when a service provider refers the barrower to an enitity the provider has beneficial interest in

Party that refered barrower to an

affiliateHOEPA Notice Additional disclosure required if the

APR is more than 10% above the treasury yield, OR total fees are more than 8% of loan amount

Lender

LOAN DOCUMENT CHECKLISTUse this Loan Document Checklist to make sure you have all the right documents to secure your loan.

35


RESOURCESThe Following Agencies Served as Resources for this Project:

AARP www.aarp.org

Fannie Mae www.fanniemae.com

Federal Citizen Information Center www.pueblo.gsa.gov

Federal Deposit Insurance Corporation www.fdic.gov

Federal Reserve Board www.federalreserve.gov

Federal Trade Commission www.ftc.gov

Freddie Mac www.freddiemac.com

Ginnie Mae www.ginniemae.gov

Seattle/King County Coalition for Responsible Lending seattle.gov/housing/predatorylending/Default.htm

U.S. Department of Urban and Housing Development (HUD) www.hud.gov

Washington State Housing Finance Commission www.wshfc.org

Washington State Office of the Attorney General www.atg.wa.gov

Disclaimer: This information is intended to provide you with general information about buying and refinancing your home. It touches on the basic steps in the process and suggests guidelines for avoiding pitfalls, but it does not attempt to provide financial or legal advice. If you lack knowledge or experience in negotiating terms, arranging financing, analyzing tax consequences, or handling related details, you should contact an attorney, or request assistance from your local housing authority before buying or refinancing a home. It is designed to be an educational tool. It does not endorse or recommend any person, product, or institution.

37


www.dfi.wa.govwww.homeownership.wa.gov

38

BUYING YOUR HOMESettlement Costs and Helpful Information

June 1997June 1997 HUD-398-H(4)HUD-398-H(4)

U.S. Department of Housing and Urban DevelopmentU.S. Department of Housing and Urban Development

Office of Housing - Federal Housing AdministrationOffice of Housing - Federal Housing Administration

39

Table of ContentsTable of Contents

I.I. IntroductionIntroduction

II.II. Buying & Financing A HomeBuying & Financing A Home

A. Role of the Real Estate Broker

B. Selecting an Attorney

C. Terms of the Agreement of Sale

D. Shopping For a Loan

E. Selecting a Settlement Agent

F. Securing Title Services

G. RESPA Disclosures

H. Processing Your Loan Application

I. RESPA Protection Against Illegal Referral Fees

J. Your Right to File Complaints

III.III. Your Settlement CostsYour Settlement Costs

A. Specific Settlement Costs

B. Calculating the Amount You Need At Settlement

C. Adjustments To Costs Shared By Buyer and Seller

D. HUD-1 Settlement Statement

IV.IV. AppendixAppendix

40

Page -1-

I.I. IntroductionIntroduction

ongratulations! You have decided to buy a new home. This booklet will help you take this bigfinancial step by describing the home buying, home financing, and settlement process. Lenders andmortgage brokers are required by federal law, the Real Estate Settlement Procedures Act (“RESPA”),to give you this booklet. You should receive it when applying for a loan, or within three business daysafterwards. Real estate brokers frequently hand out this booklet as well.

You probably started the home buying process in one of two ways: you saw a home you wereinterested in buying or you consulted a lender to figure out how much money you could borrow beforeyou found a home (sometimes called pre-qualifying). The next step is to sign an agreement of sale withthe seller, followed by applying for a loan to purchase your new home. The final step is called“settlement” or “closing,” where the legal title to the property is transferred to you.

At each of these steps you often have the opportunity to negotiate the terms, conditions andcosts to your advantage. This booklet will highlight such opportunities. You will also need to shopcarefully to get the best value for your money. There is no standard home buying process used in alllocalities. Your actual experience may vary from those described here. This booklet takes you throughthe general steps to buying a home, to eliminate, as much as possible, the mysteries of the settlementprocess.

C

41

Page -2-

II.II. BUYING AND FINANCING A HOMEBUYING AND FINANCING A HOME A. A. Role of the Real Estate BrokerRole of the Real Estate Broker

requently, the first person you consult about buying a home is a real estate agent or broker. Although real estate brokers provide helpful advice on many aspects of home buying, they may servethe interests of the seller, and not your interests as the buyer. The most common practice is forthe seller to hire the broker to find someone who will be willing to buy the home on terms andconditions that are acceptable to the seller. Therefore, the real estate broker you are dealing with mayalso represent the seller. However, you can hire your own real estate broker, known as a buyer’sbroker, to represent your interests. Also, in some states, agents and brokers are allowed to representboth buyer and seller.

Even if the real estate broker represents the seller, state real estate licensing laws usuallyrequire that the broker treat you fairly. If you have any questions concerning the behavior of an agentor broker, you should contact your State’s Real Estate Commission or licensing department.

Sometimes, the real estate broker will offer to help you obtain a mortgage loan. He or she mayalso recommend that you deal with a particular lender, title company, attorney or settlement/closingagent. You are not required to follow the real estate broker’s recommendation. You should comparethe costs and services offered by other providers with those recommended by the real estate broker.

B.B. Selecting an AttorneySelecting an Attorney

efore you sign an agreement of sale, you might consider asking an attorney to look it over andtell you if it protects your interests. If you have already signed your agreement of sale, you might stillconsider having an attorney review it. An attorney can also help you prepare for the settlement. Insome areas attorneys act as settlement/closing agents or as escrow agents to handle the settlement. Anattorney who does this will not solely represent your interests, since, as settlement/closing agent,he or she may also be representing the seller, the lender and others as well.

Please note, in many areas of the country attorneys are not normally involved in the home sale. For example, escrow agents or escrow companies in western states handle the paperwork to transfertitle without any attorney involvement.

If choosing an attorney, you should shop around and ask what services will be performed forwhat fee. Find out whether the attorney is experienced in representing home buyers. You may wish toask the attorney questions such as:

F

B

42

Page -3-

v What is the charge for negotiating the agreement of sale, reviewing documents and giving adviceconcerning those documents, for being present at the settlement, or for reviewing instructions tothe escrow agent or company?

v Will the attorney represent anyone other than you in the transaction? v Will the attorney be paid by anyone other than you in the transaction?

C.C. Terms of the Agreement of SaleTerms of the Agreement of Sale

f you receive this Booklet before you sign an agreement of sale, here are some important pointsto consider. The real estate broker probably will give you a preprinted form of agreement of sale. Youmay make changes or additions to the form agreement, but the seller must agree to every change youmake. You should also agree with the seller on when you will move in and what appliances andpersonal property will be sold with the home.

v Sales Price. For most home purchasers, the sales price is the most important term. Recognize that other non-monetary terms of the agreement are also important.

v Title. “Title” refers to the legal ownership of your new home. The seller shouldprovide title, free and clear of all claims by others against your new home. Claims byothers against your new home are sometimes known as “liens” or “encumbrances.”You may negotiate who will pay for the title search which will tell you whether the titleis "clear."

v Mortgage Clause. The agreement of sale should provide that your deposit will berefunded if the sale has to be canceled because you are unable to get a mortgage loan. For example, your agreement of sale could allow the purchase to be canceled if youcannot obtain mortgage financing at an interest rate at or below a rate you specify inthe agreement.

v Pests. Your lender will require a certificate from a qualified inspector stating that thehome is free from termites and other pests and pest damage. You may want to reserve

I

43

Page -4-

the right to cancel the agreement or seek immediate treatment and repairs by the sellerif pest damage is found.

v Home Inspection. It is a good idea to have the home inspected. An inspection shoulddetermine the condition of the plumbing, heating, cooling and electrical systems. Thestructure should also be examined to assure it is sound and to determine the conditionof the roof, siding, windows and doors. The lot should be graded away from the houseso that water does not drain toward the house and into the basement.

Most buyers prefer to pay for these inspections so that the inspector is working forthem, not the seller. You may wish to include in your agreement of sale the right tocancel, if you are not satisfied with the inspection results. In that case, you may wantto re-negotiate for a lower sale price or require the seller to make repairs.

v Lead-Based Paint Hazards in Housing Built Before 1978. If you buy a home builtbefore 1978, you have certain rights concerning lead-based paint and lead poisoninghazards. The seller or sales agent must give you the EPA pamphlet “Protect YourFamily From Lead in Your Home” or other EPA-approved lead hazard information.The seller or sales agent must tell you what the seller actually knows about the home’slead-based paint or lead-based paint hazards and give you any relevant records orreports.

You have at least ten (10) days to do an inspection or risk assessment for lead-basedpaint or lead-based paint hazards. However, to have the right to cancel the sale basedon the results of an inspection or risk assessment, you will need to negotiate thiscondition with the seller.

Finally, the seller must attach a disclosure form to the agreement of sale which willinclude a Lead Warning Statement. You, the seller, and the sales agent will sign anacknowledgment that these notification requirements have been satisfied.

v Other Environmental Concerns. Your city or state may have laws requiring buyers orsellers to test for environmental hazards such as leaking underground oil tanks, thepresence of radon or asbestos, lead water pipes, and other such hazards, and to takethe steps to clean-up any such hazards. You may negotiate who will pay for the costsof any required testing and/or clean-up.

v Sharing of Expenses. You need to agree with the seller about how expenses related tothe property such as taxes, water and sewer charges, condominium fees, and utility

44

Page -5-

bills, are to be divided on the date of settlement. Unless you agree otherwise, youshould only be responsible for the portion of these expenses owed after the date of sale.

v Settlement Agent/Escrow Agent or Company. Depending on local practices, you mayhave an option to select the settlement agent or escrow agent or company. For stateswhere an escrow agent or company will handle the settlement, the buyer, seller andlender will provide instructions.

v Settlement Costs. You can negotiate which settlement costs you will pay and whichwill be paid by the seller.

D.D. Shopping For a LoanShopping For a Loan

our choice of lender and type of loan will influence not only your settlement costs, but also themonthly cost of your mortgage loan. There are many types of lenders and types of loans you canchoose. You may be familiar with banks, savings associations, mortgage companies and credit unions,many of which provide home mortgage loans. You may find a listing of some mortgage lenders in theyellow pages or a listing of rates in your local newspaper.

Mortgage Brokers. Some companies, known as “mortgage brokers” offer to find you amortgage lender willing to make you a loan. A mortgage broker may operate as an independentbusiness and may not be operating as your “agent” or representative. Your mortgage brokermay be paid by the lender, you as the borrower, or both. You may wish to ask about the fees that themortgage broker will receive for its services.

Government Programs. You may be eligible for a loan insured through the Federal HousingAdministration (“FHA”) or guaranteed by the Department of Veterans Affairs or similar programsoperated by cities or states. These programs usually require a smaller downpayment. Ask lendersabout these programs. You can get more information about these programs from the agencies that runthem. (See Appendix to this Booklet.)

CLOs. Computer loan origination systems, or CLOs, are computer terminals sometimesavailable in real estate offices or other locations to help you sort through the various types of loansoffered by different lenders. The CLO operator may charge a fee for the services the CLO offers. Thisfee may be paid by you or by the lender that you select.

Y

45

Page -6-

Types of Loans. Loans can have a fixed interest rate or a variable interest rate. Fixed rate loanshave the same principal and interest payments during the loan term. Variable rate loans can have anyone of a number of “indexes” and “margins” which determine how and when the rate and paymentamount change. If you apply for a variable rate loan, also known as an adjustable rate mortgage(“ARM”), a disclosure and booklet required by the Truth in Lending Act will further describe theARM. Most loans can be repaid over a term of 30 years or less. Most loans have equal monthlypayments. The amounts can change from time to time on an ARM depending on changes in the interestrate. Some loans have short terms and a large final payment called a “balloon.” You should shop forthe type of home mortgage loan terms that best suit your needs.

Interest Rate, “Points” & Other Fees. Often the price of a home mortgage loan is stated interms of an interest rate, points, and other fees. A “point” is a fee that equals 1 percent of the loanamount. Points are usually paid to the lender, mortgage broker, or both, at the settlement or upon thecompletion of the escrow. Often, you can pay fewer points in exchange for a higher interest rate ormore points for a lower rate. Ask your lender or mortgage broker about points and other fees.

A document called the Truth in Lending Disclosure Statement will show you the “AnnualPercentage Rate” (“APR”) and other payment information for the loan you have applied for. The APRtakes into account not only the interest rate, but also the points, mortgage broker fees and certain otherfees that you have to pay. Ask for the APR before you apply to help you shop for the loan that is bestfor you. Also ask if your loan will have a charge or a fee for paying all or part of the loan beforepayment is due (“prepayment penalty”). You may be able to negotiate the terms of the prepaymentpenalty.

Lender-Required Settlement Costs. Your lender may require you to obtain certain settlement services, such as a new survey, mortgage insurance or title insurance. It may also order and charge youfor other settlement-related services, such as the appraisal or credit report. A lender may also chargeother fees, such as fees for loan processing, document preparation, underwriting, flood certification oran application fee. You may wish to ask for an estimate of fees and settlement costs before choosing alender. Some lenders offer “no cost” or “no point” loans but normally cover these fees or costs bycharging a higher interest rate.

Comparing Loan Costs. Comparing APRs may be an effective way to shop for a loan. However,you must compare similar loan products for the same loan amount. For example, compare two 30-year fixed rate loans for $100,000. Loan A with an APR of 8.35% is less costly than Loan B with anAPR of 8.65% over the loan term. However, before you decide on a loan, you should consider theup-front cash you will be required to pay for each of the two loans as well.

Another effective shopping technique is to compare identical loans with different up-frontpoints and other fees. For example, if you are offered two 30-year fixed rate loans for $100,000 and at8%, the monthly payments are the same, but the up-front costs are different:

46

Page -7-

Loan A - 2 points ($2,000) and lender required costs of $1800 = $3800 in costs.Loan B - 2 1/4 points ($2250) and lender required costs of $1200 = $3450 in costs.

A comparison of the up-front costs shows Loan B requires $350 less in up-front cash than Loan A. However, your individual situation (how long you plan to stay in your house) and your tax situation(points can usually be deducted for the tax year that you purchase a house) may affect your choice ofloans.

Lock-ins. “Locking in” your rate or points at the time of application or during the processingof your loan will keep the rate and/or points from changing until settlement or closing of the escrowprocess. Ask your lender if there is a fee to lock-in the rate and whether the fee reduces the amountyou have to pay for points. Find out how long the lock-in is good, what happens if it expires, andwhether the lock-in fee is refundable if your application is rejected.

Tax and Insurance Payments. Your monthly mortgage payment will be used to repay themoney you borrowed plus interest. Part of your monthly payment may be deposited into an “escrowaccount” (also known as a “reserve” or “impound” account) so your lender or servicer can pay yourreal estate taxes, property insurance, mortgage insurance and/or flood insurance. Ask your lender ormortgage broker if you will be required to set up an escrow or impound account for taxes andinsurance payments.

Transfer of Your Loan. While you may start the loan process with a lender or mortgage broker,you could find that after settlement another company may be collecting the payments on your loan. Collecting loan payments is often known as “servicing” the loan. Your lender or broker will disclosewhether it expects to service your loan or to transfer the servicing to someone else.

Mortgage Insurance. Private mortgage insurance and government mortgage insurance protectthe lender against default and enable the lender to make a loan which the lender considers a higher risk. Lenders often require mortgage insurance for loans where the downpayment is less than 20% of thesales price. You may be billed monthly, annually, by an initial lump sum, or some combination of thesepractices for your mortgage insurance premium. Ask your lender if mortgage insurance is required andhow much it will cost. Mortgage insurance should not be confused with mortgage life, credit life ordisability insurance, which are designed to pay off a mortgage in the event of the borrower’s death ordisability.

You may also be offered “lender paid” mortgage insurance (“LPMI”). Under LPMI plans, thelender purchases the mortgage insurance and pays the premiums to the insurer. The lender willincrease your interest rate to pay for the premiums -- but LPMI may reduce your settlement costs. You cannot cancel LPMI or government mortgage insurance during the life of your loan. However, it

47

Page -8-

may be possible to cancel private mortgage insurance at some point, such as when your loan balance isreduced to a certain amount. Before you commit to paying for mortgage insurance, find out thespecific requirements for cancellation.

Flood Hazard Areas. Most lenders will not lend you money to buy a home in a flood hazardarea unless you pay for flood insurance. Some government loan programs will not allow you topurchase a home that is located in a flood hazard area. Your lender may charge you a fee to checkfor flood hazards. You should be notified if flood insurance is required. If a change in floodinsurance maps brings your home within a flood hazard area after your loan is made, your lender orservicer may require you to buy flood insurance at that time.

E.E. Selecting a Settlement AgentSelecting a Settlement Agent

ettlement practices vary from locality to locality, and even within the same county or city. Settlements may be conducted by lenders, title insurance companies, escrow companies, real estatebrokers or attorneys for the buyer or seller. You may save money by shopping for the settlementagent.

In some parts of the country (particularly western states), settlement may be conducted by anescrow agent. The parties sign an escrow agreement which requires them to provide certaindocuments and funds to the agent. Unlike other types of settlement, the parties do not meet around atable to sign documents. Ask how your settlement will be handled.

F.F. Securing TiSecuring Title Servicestle Services

itle insurance is usually required by the lender to protect the lender against loss resulting fromclaims by others against your new home. In some states, attorneys offer title insurance as part of theirservices in examining title and providing a title opinion. The attorney's fee may include the titleinsurance premium. In other states, a title insurance company or title agent directly provides the titleinsurance.

Owner’s Policy. A lender’s title insurance policy does not protect you. Similarly, the priorowner’s policy does not protect you. If you want to protect yourself from claims by others againstyour new home, you will need an owner's policy. When a claim does occur, it can be financially

S

T

48

Page -9-

devastating to an owner who is uninsured. If you buy an owner's policy, it is usually much lessexpensive if you buy it at the same time and with the same insurer as the lender's policy.

Choice of Title Insurer. Under RESPA, the seller may not require you, as a condition of thesale, to purchase title insurance from any particular title company. Generally, your lender will requiretitle insurance from a company that is acceptable to it. In most cases you can shop for and choose acompany that meets the lender’s standards.

Review Initial Title Report. In many areas, a few days or weeks before the settlement orclosing of the escrow, the title insurance company will issue a “Commitment to Insure” or preliminaryreport or “binder” containing a summary of any defects in title which have been identified by the titlesearch, as well as any exceptions from the title insurance policy’s coverage. The commitment is usuallysent to the lender for use until the title insurance policy is issued at or after the settlement. You canarrange to have a copy sent to you (or to your attorney) so that you can object if there are mattersaffecting the title which you did not agree to accept when you signed the agreement of sale.

Coverage & Cost Savings. To save money on title insurance, compare rates among varioustitle insurance companies. Ask what services and limitations on coverage are provided under eachpolicy so that you can decide whether coverage purchased at a higher rate may be better for yourneeds. However, in many states, title insurance premium rates are established by the state and may notbe negotiable. If you are buying a home which has changed hands within the last several years, askyour title company about a "reissue rate," which would be cheaper. If you are buying a newlyconstructed home, make certain your title insurance covers claims by contractors. These claims areknown as “mechanics’ liens” in some parts of the country.

Survey. Lenders or title insurance companies often require a survey to mark the boundaries ofthe property. A survey is a drawing of the property showing the perimeter boundaries and marking thelocation of the house and other improvements. You may be able to avoid the cost of a completesurvey if you can locate the person who previously surveyed the property and request an update. Check with your lender or title insurance company on whether an updated survey is acceptable.

G.G. RESPA DisclosuresRESPA Disclosures

One of the purposes of RESPA is to help consumers become better shoppers for settlement

services. RESPA requires that borrowers receive disclosures at various times. Some disclosures spell

49

Page -10-

out the costs associated with the settlement, outline lender servicing and escrow account practices anddescribe business relationships between settlement service providers.

Good Faith Estimate of Settlement Costs. RESPA requires that, when you apply for a loan,the lender or mortgage broker give you a Good Faith Estimate of settlement service charges you willlikely have to pay. If you do not get this Good Faith Estimate when you apply, the lender or mortgagebroker must mail or deliver it to you within the next three business days.

Be aware that the amounts listed on the Good Faith Estimate are only estimates. Actual costsmay vary. Changing market conditions can affect prices. Remember that the lender's estimate is not aguarantee. Keep your Good Faith Estimate so you can compare it with the final settlement costsand ask the lender questions about any changes.

Servicing Disclosure Statement. RESPA requires the lender or mortgage broker to tell you inwriting, when you apply for a loan or within the next three business days, whether it expects thatsomeone else will be servicing your loan (collecting your payments).

Affiliated Business Arrangements. Sometimes, several businesses that offer settlementservices are owned or controlled by a common corporate parent. These businesses are known as“affiliates.” When a lender, real estate broker, or other participant in your settlement refers you to anaffiliate for a settlement service (such as when a real estate broker refers you to a mortgage brokeraffiliate), RESPA requires the referring party to give you an Affiliated Business ArrangementDisclosure. This form will remind you that you are generally not required, with certain exceptions, touse the affiliate and are free to shop for other providers.

HUD-1 Settlement Statement. One business day before the settlement, you have the right toinspect the HUD-1 Settlement Statement. This statement itemizes the services provided to you and thefees charged to you. This form is filled out by the settlement agent who will conduct the settlement. Be sure you have the name, address, and telephone number of the settlement agent if you wish toinspect this form. The fully completed HUD-1 Settlement Statement generally must be delivered ormailed to you at or before the settlement. In cases where there is no settlement meeting, the escrowagent will mail you the HUD-1 after settlement, and you have no right to inspect it one day beforesettlement.

Escrow Account Operation & Disclosures. Your lender may require you to establish anescrow or impound account to insure that your taxes and insurance premiums are paid on time. If so,you will probably have to pay an initial amount at the settlement to start the account and an additionalamount with each month’s regular payment. Your escrow account payments may include a “cushion”or an extra amount to ensure that the lender has enough money to make the payments when due. RESPA limits the amount of the cushion to a maximum of two months of escrow payments.

50

Page -11-

T

At the settlement or within the next 45 days, the person servicing your loan must give you aninitial escrow account statement. That form will show all of the payments which are expected to bedeposited into the escrow account and all of the disbursements which are expected to be made fromthe escrow account during the year ahead. Your lender or servicer will review the escrow accountannually and send you a disclosure each year which shows the prior year’s activity and any adjustmentsnecessary in the escrow payments that you will make in the forthcoming year.

H.H. Processing Your Loan ApplicationProcessing Your Loan Application

here are several federal laws which provide you with protection during the processing of yourloan. The Equal Credit Opportunity Act (“ECOA”), the Fair Housing Act, and the Fair CreditReporting Act (“FCRA”) prohibit discrimination and provide you with the right to certain creditinformation.

No Discrimination. ECOA prohibits lenders from discriminating against credit applicants onthe basis of race, color, religion, national origin, sex, marital status, age, the fact that all or part of theapplicant's income comes from any public assistance program, or the fact that the applicant hasexercised any right under any federal consumer credit protection law. To help government agenciesmonitor ECOA compliance, your lender or mortgage broker must request certain informationregarding your race, sex, marital status and age when taking your loan application.

The Fair Housing Act also prohibits discrimination in residential real estate transactions on thebasis of race, color, religion, sex, handicap, familial status or national origin. This prohibition applies toboth the sale of a home to you and the decision by a lender to give you a loan to help pay for thathome. Finally, your locality or state may also have a law which prohibits discrimination.

Frequently, there are differences in the types and amounts of settlement costs charged to theborrower -- for example, some borrowers are charged greater fees for mortgages depending on theircredit worthiness. These differences may be justified or they may be unlawfully discriminatory. It isimportant that you examine your settlement documents closely, especially lines 808-811 on the HUD-1settlement statement, and do not hesitate to compare your settlement costs with those of your friendsand neighbors.

If you feel you have been discriminated against by a lender or anyone else in the home buyingprocess, you may file a private legal action against that person or complain to a state, local or federaladministrative agency. You may want to talk to an attorney; or you may want to ask the federal agency

51

Page -12-

that enforces ECOA (the Board of Governors of the Federal Reserve System) or the Fair Housing Act(HUD) about your rights under these laws.

Prompt Action/Notification of Action Taken. Your lender or mortgage broker must act on yourapplication and inform you of the action taken no later than 30 days after it receives your completedapplication. Your application will not be considered complete, and the 30 day period will not begin,until you provide to your lender or mortgage broker all of the material and information requested.

Statement of Reasons for Denial. If your application is denied, ECOA requires your lender ormortgage broker to give you a statement of the specific reasons why it denied your application or tellyou how you can obtain such a statement. The notice will also tell you which federal agency to contactif you think the lender or mortgage broker has illegally discriminated against you.

Obtaining Your Credit Report. The Fair Credit Reporting Act (“FCRA”) requires a lender ormortgage broker that denies your loan application to tell you whether it based its decision oninformation contained in your credit report. If that information was a reason for the denial, the noticewill tell you where you can get a free copy of the credit report. You have the right to dispute theaccuracy or completeness of any information in your credit report. If you dispute any information, thecredit reporting agency that prepared the report must investigate free of charge and notify you of theresults of the investigation.

Obtaining Your Appraisal. The lender needs to know if the value of your home is enough tosecure the loan. To get this information, the lender typically hires an appraiser, who gives aprofessional opinion about the value of your home. ECOA requires your lender or mortgage broker totell you that you have a right to get a copy of the appraisal report. The notice will also tell you howand when you can ask for a copy.

I.I. RESPA Protection Against Illegal Referral FeesRESPA Protection Against Illegal Referral Fees

ESPA was enacted because Congress felt that consumers needed protection from"... unnecessarily high settlement charges caused by certain abusive practices that have developed insome areas of the country." Some of the practices Congress was concerned about are discussedbelow. Most professionals in the settlement business provide good service and do not engage in thesepractices.

Prohibited Fees. It is illegal under RESPA for anyone to pay or receive a fee, kickback oranything of value because they agree to refer settlement service business to a particular person or

R

52

Page -13-

organization. For example, your mortgage lender may not pay your real estate broker $250 forreferring you to the lender. It is also illegal for anyone to accept a fee or part of a fee for services ifthat person has not actually performed settlement services for the fee. For example, a lender may notadd to a third party’s fee, such as an appraisal fee, and keep the difference.

Permitted Payments. RESPA does not prevent title companies, mortgage brokers, appraisers,attorneys, settlement/closing agents and others, who actually perform a service in connection with themortgage loan or the settlement, from being paid for the reasonable value of their work. If aparticipant in your settlement appears to be taking a fee without having done any work, you shouldadvise that person or company of the RESPA referral fee prohibitions. You may also speak with yourattorney or complain to a regulator listed in the Appendix to this Booklet.

Penalties. It is a crime for someone to pay or receive an illegal referral fee. The penalty can bea fine, imprisonment or both. You may be entitled to recover three times the amount of the charge forany settlement service by bringing a private lawsuit. If you are successful, the court may also awardyou court costs and your attorney’s fees.

J.J. Your Right to File ComplaintsYour Right to File Complaints

Private Lawsuits. If you have a problem, the best place to have it fixed is at its source (thelender, settlement agent, broker, etc.). If that approach fails and you think you have suffered becauseof a violation of RESPA, ECOA or any other law, you may be entitled to sue in a federal or statecourt. This is a matter you should discuss with your attorney.

Government Agencies. Most settlement service providers are supervised by a governmentalagency at the local, state and/or federal level, some of which are listed in the Appendix to this Booklet. Your state’s Attorney General may have a consumer affairs division. If you feel that a provider ofsettlement services has violated RESPA or any other law, you can complain to that agency orassociation. You may also send a copy of your complaint to the HUD Office of Consumer &Regulatory Affairs. The address is listed in the Appendix.

Servicing Errors. If you have a question any time during the life of your loan, RESPA requiresthe company collecting your loan payments (your “servicer”) to respond to you. Write to your servicerand call it a “qualified written request under Section 6 of RESPA.” A “qualified written request”should be a separate letter and not mailed with the payment coupon. Describe the problem and includeyour name and account number. The servicer must investigate and make appropriate correctionswithin 60 business days.

53

Page -14-

III.III. YOUR SETTLEMENT COSTSYOUR SETTLEMENT COSTS

A.A. Specific Settlement CostsSpecific Settlement Costs

his part of the Booklet discusses the settlement services which you may be required to get andpay for and which are itemized in Section L of the HUD-1 Settlement Statement. You also will find asample of the HUD-1 form to help you to understand the settlement transaction.

When shopping for settlement services, you can use this section as a guide, noting on it thepossible services required by various lenders and the different fees quoted by service providers. Settlement costs can increase the cost of your loan, so compare carefully.

700. Sales/Broker's Commission: This is the total dollar amount of the real estate broker’ssales commission, which is usually paid by the seller. This commission is typically a percentage of theselling price of the home.

L. SETTLEMENT CHARGES

700. TOTAL SALES/BROKER’S COMMISSION based on price $ @ %=PAID FROM

BORROWER’SFUNDS AT

PAID FROMSELLER’SFUNDS AT

Division of Commission (line 700) as follows: SETTLEMENT SETTLEMENT

701. $ to702. $ to703. Commission paid at Settlement704.

800. Items Payable in Connection with Loan: These are the fees that lenders charge toprocess, approve and make the mortgage loan:

801. Loan Origination: This fee is usually known as a loan origination fee but sometimes iscalled a “point” or “points.” It covers the lender's administrative costs in processing the loan. Oftenexpressed as a percentage of the loan, the fee will vary among lenders. Generally, the buyer pays thefee, unless otherwise negotiated.

802. Loan Discount: Also often called "points" or “discount points,” a loan discount is aone-time charge imposed by the lender or broker to lower the rate at which the lender or broker would

T

54

Page -15-

otherwise offer the loan to you. Each "point" is equal to one percent of the mortgage amount. Forexample, if a lender charges two points on a $80,000 loan this amounts to a charge of $1,600.

803. Appraisal Fee: This charge pays for an appraisal report made by an appraiser.

804. Credit Report Fee: This fee covers the cost of a credit report, which shows your credithistory. The lender uses the information in a credit report to help decide whether or not to approveyour loan and how much money to lend you.

805. Lender's Inspection Fee: This charge covers inspections, often of newly constructedhousing, made by employees of your lender or by an outside inspector. (Pest or other inspectionsmade by companies other than the lender are discussed in line 1302.)

806. Mortgage Insurance Application Fee: This fee covers the processing of an applicationfor mortgage insurance.

807. Assumption Fee: This is a fee which is charged when a buyer “assumes” or takes overthe duty to pay the seller’s existing mortgage loan.

808. Mortgage Broker Fee: Fees paid to mortgage brokers would be listed here. A CLOfee would also be listed here.

800. ITEMS PAYABLE IN CONNECTION WITH LOAN801. Loan Origination Fee %802. Loan Discount %803. Appraisal Fee to804. Credit Report to805. Lender’s Inspection Fee806. Mortgage Insurance Application Fee to807. Assumption Fee808. Mortgage Broker Fee809.810.811.

900. Items Required by Lender to Be Paid in Advance: You may be required to prepaycertain items at the time of settlement, such as accrued interest, mortgage insurance premiums andhazard insurance premiums.

901. Interest: Lenders usually require borrowers to pay the interest that accrues from thedate of settlement to the first monthly payment.

55

Page -16-

902. Mortgage Insurance Premium: The lender may require you to pay your first year’smortgage insurance premium or a lump sum premium that covers the life of the loan, in advance, at thesettlement.

903. Hazard Insurance Premium: Hazard insurance protects you and the lender against lossdue to fire, windstorm, and natural hazards. Lenders often require the borrower to bring to thesettlement a paid-up first year’s policy or to pay for the first year's premium at settlement.

904. Flood Insurance: If the lender requires flood insurance, it is usually listed here.

900. ITEMS REQUIRED BY LENDER TO BE PAID IN ADVANCE

901. Interest from to @$ /day902. Mortgage Insurance Premium for months to903. Hazard Insurance Premium for years to904. years to905.

1000 - 1008. Escrow Account Deposits: These lines identify the payment of taxes and/orinsurance and other items that must be made at settlement to set up an escrow account. The lender isnot allowed to collect more than a certain amount. The individual item deposits may overstate theamount that can be collected. The aggregate adjustment makes the correction in the amount on line1008. It will be zero or a negative amount.

1000. RESERVES DEPOSITED WITH LENDER1001. Hazard Insurance months @ $ per month1002. Mortgage insurance months @ $ per month1003. City property taxes months @ $ per month1004. County property taxes months @ $ per month1005. Annual assessments months @ $ per month1006. months @ $ per month1007. months @ $ per month1008. Aggregate Adjustment

1100. Title Charges: Title charges may cover a variety of services performed by titlecompanies and others. Your particular settlement may not include all of the items below or mayinclude others not listed.

1101. Settlement or Closing Fee: This fee is paid to the settlement agent or escrow holder.Responsibility for payment of this fee should be negotiated between the seller and the buyer.

1102-1104. Abstract of Title Search, Title Examination, Title Insurance Binder: The chargeson these lines cover the costs of the title search and examination.

56

Page -17-

1105. Document Preparation: This is a separate fee that some lenders or title companiescharge to cover their costs of preparation of final legal papers, such as a mortgage, deed of trust, noteor deed.

1106. Notary Fee: This fee is charged for the cost of having a person who is licensed as anotary public swear to the fact that the persons named in the documents did, in fact, sign them.

1107. Attorney's Fees: You may be required to pay for legal services provided to the lender,such as an examination of the title binder. Occasionally, the seller will agree in the agreement of sale topay part of this fee. The cost of your attorney and/or the seller’s attorney may also appear here. If anattorney's involvement is required by the lender, the fee will appear on this part of the form, or on lines1111, 1112 or 1113.

1108. Title Insurance: The total cost of owner's and lender's title insurance is shown here.

1109. Lender's Title Insurance: The cost of the lender’s policy is shown here.

1110. Owner's (Buyer’s) Title Insurance: The cost of the owner's policy is shown here.

1100. TITLE CHARGES1101. Settlement or closing fee to1102. Abstract or title search to1103. Title examination to1104. Title insurance binder to1105. Document preparation to1106. Notary fees to1107. Attorney’s fees to

(includes above items numbers; )1108. Title Insurance to

(includes above items numbers; )1109. Lender’s coverage $1110. Owner’s coverage $1111.1112.1113.

1200. Government Recording and Transfer Charges: These fees may be paid by you or bythe seller, depending upon your agreement of sale with the seller. The buyer usually pays the fees forlegally recording the new deed and mortgage (line 1201). Transfer taxes, which in some localities arecollected whenever property changes hands or a mortgage loan is made, can be quite large and are setby state and/or local governments. City, county and/or state tax stamps may have to be purchased aswell (lines 1202 and 1203).

1200. GOVERNMENT RECORDING AND TRANSFER CHARGES1201. Recording fees: Deed $ ; Mortgage $ ; Releases $

57

Page -18-

1202. City/county tax/stamps: Deed $ ; Mortgage $

1203. State tax/stamps: Deed $ ; Mortgage $

1204.1205.

1300. Additional Settlement Charges:

1301. Survey: The lender may require that a surveyor conduct a property survey. This is aprotection to the buyer as well. Usually the buyer pays the surveyor's fee, but sometimes this may bepaid by the seller.

1302. Pest and Other Inspections: This fee is to cover inspections for termites or other pestinfestation of your home.

1303-1305. Lead-Based Paint Inspections: This fee is to cover inspections or evaluations forlead-based paint hazard risk assessments and may be on any blank line in the 1300 series.

1300. ADDITIONAL SETTLEMENT CHARGES1301. Survey to1302. Pest inspection to1303.1304.1305.

1400. Total Settlement Charges: The sum of all fees in the borrower's column entitled "Paidfrom Borrower's Funds at Settlement" is placed here. This figure is then transferred to line 103 ofSection J, "Settlement charges to borrower" in the Summary of Borrower's Transaction on page 1of the HUD-1 Settlement Statement and added to the purchase price. The sum of all of the settlementfees paid by the seller are transferred to line 502 of Section K, Summary of Seller's Transaction onpage 1 of the HUD-1 Settlement Statement.

1400. TOTAL SETTLEMENT CHARGES (enter on lines 103, Section J and 502, Section K)

Paid Outside Of Closing (“POC”): Some fees may be listed on the HUD-1 to the left of theborrower’s column and marked “P.O.C.” Fees such as those for credit reports and appraisals areusually paid by the borrower before closing/settlement. They are additional costs to you. Other feessuch as those paid by the lender to a mortgage broker or other settlement service providers may bepaid after closing/settlement. These fees are usually included in the interest rate or other settlement

58

Page -19-

charge. They are not an additional cost to you. These types of fees will not be added into the total onLine 1400.

B.B. Calculating the Amount You Need At SettlementCalculating the Amount You Need At Settlement

he first page of the HUD-1 Settlement Statement summarizes all the costs and adjustments forthe borrower and seller. Section J is the summary of the borrower’s transaction and Section K is thesummary of the seller’s side of the transaction. You may receive a copy of the seller’s side, but it is notrequired.

Section 100 summarizes the borrower’s costs, such as the contract cost of the house, anypersonal property being purchased, and the total settlement charges owed by the borrower fromSection L.

Beginning at line 106, adjustments are made for items (such as taxes, assessments, fuel) that theseller has previously paid. If you will benefit from these items after settlement, you will usually repaythe seller for that portion of the cost.

Here is an example for you to use in making your own calculations:

J. SUMMARY OF BORROWER'S TRANSACTION100. GROSS AMOUNT DUE FROM BORROWER:101. Contract sales price 100,000.00102. Personal Property

103. Settlement charges to borrower (line 1400) 4,000.00104.

105.

Adjustments for items paid by seller in advance106. City/town taxes to

107. County taxes to

108. Assessments 6/30 to 7/31 (owners assn.) 40.00

109. Fuel Oil 25 gals. @ $1.00/gal. 25.00110.

111.

112.

120. GROSS AMOUNT DUE FROM BORROWER 104,065.00

Assume in this example, the cost of the house is $100,000 and the borrower’s totalsettlement charges brought from Line 1400 of Section L are $4,000. Assume that the settlement

T

59

Page -20-

date is July 1. Here the borrower has agreed to pay the seller for the $40 Home OwnersAssociation dues that have been paid for the month of July and for the 25 gallons of fuel oil leftin the tank. This is added for a gross amount due from the borrower of $104,065.

Section 200 lists the amount paid by the borrower or on behalf of the borrower. This willinclude the deposit of earnest money you put down with the agreement of sale, the loan(s) you aregetting and any loan you may be assuming.

Beginning at Line 210, adjustments are made for items that the seller owes (such as taxes,assessments) but for which you as the borrower will pay after settlement. The seller will usuallypay you or credit you this portion at settlement.

200. AMOUNTS PAID BY OR IN BEHALF OF BORROWER:201. Deposit of earnest money 2,000.00202. Principal amount of new loan(s) 80,000.00203. Existing loan(s) taken subject to

204.

205.

206.

207.

208.

209.

Adjustments for items unpaid by seller

210. City/town taxes to

211. County taxes 1/1 to 6/30 $1,200/ year 600.00

212. Assessments 1/1 to 6/30 $200/yr. 100.00213.

214.

215.

216.

217.

218.

219.

220. TOTAL PAID BY/FOR BORROWER 82,700.00

60

Page -21-

In this example, assume the borrower paid an earnest deposit of $2,000 and is getting aloan for $80,000. A tax of $1200 and an assessment of $200 are due at the end of the year. Theseller will pay the borrower for six months or one-half of this amount. Line 220 shows the total $82,700 to be paid by or for the borrower.

Section 300 reflects the difference between the gross amount due from the borrower and thetotal amount paid by/for the borrower. Generally, line 303 will show the amount of cash the borrowermust bring to settlement.

300. CASH AT SETTLEMENT FROM/TO BORROWER301. Gross Amount due from borrower (line 120) 104,065.00302. Less amounts paid by/for borrower (line 220) (82,700.00)303. CASH (⌧⌧ FROM) ( rr TO) BORROWER 21,365.00

In this example, the borrower must bring $21,365.00 to settlement.

C. Adjustments To Costs Shared By Buyer and SellerC. Adjustments To Costs Shared By Buyer and Seller

t settlement it is usually necessary to make an adjustment between buyer and seller for propertytaxes and other expenses. The adjustments between buyer and seller are shown in Sections J and K ofthe HUD-1 Settlement Statement. In the example given above, the taxes, which are payable annually,had not yet been paid when the settlement occurs on July 1. The borrower will have to pay a wholeyear's taxes on the following December 1. However, the seller lived in the house for the first sixmonths of the year. Thus, one half of the year's taxes are to be paid by the seller. Accordingly, lines211 and 511 on the HUD-1 Settlement Statement would read as follows:

211. County taxes 1/1/97 to 6/30/97 $600.00 511. County taxes 1/1/97 to 6/30/97 $600.00

The borrower is given credit for this amount at the settlement and the seller will pay thisamount or count it as a deduction from sums payable to the seller.

Similar adjustments are made for homeowner association dues, special assessments, and fueland other utilities, although the billing periods for these may not always be on an annual basis. Be sureyou work out these cost sharing arrangements or “prorations” with the seller before the settlement. You may wish to notify utility companies of the change in ownership and ask for a special reading onthe day of settlement, with the bill for pre-settlement charges to be mailed to the seller at his or her new

A

61

Page -22-

address or to the settlement agent. This will eliminate much confusion that can result if you are billedfor utilities used when the seller owned the property.

62

D. HUD-1 Settlement StatementD. HUD-1 Settlement Statement

A. U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT SETTLEMENT STATEMENT

B. TYPE OF LOAN6. File Number 7. Loan Number

1. o FHA 2. o FmHA

3. o CONV. UNINS. 4. o VA 5. o CONV. INS. 8. Mortgage Insurance Case Number

C. NOTE: This form is furnished to give you a statement of actual settlement costs. Amounts paid to and by the settlement agent are shown. Items marked “(p.o.c.)” werepaid outside the closing; they are shown here for informational purposes and are not included in the totals.

D. NAME AND ADDRESS OF BORROWER: E. NAME AND ADDRESS OF SELLER: F. NAME AND ADDRESS OF LENDER:

G. PROPERTY LOCATION: H. SETTLEMENT AGENT: NAME, AND ADDRESS

PLACE OF SETTLEMENT: I. SETTLEMENT DATE:

J. SUMMARY OF BORROWER’S TRANSACTION K. SUMMARY OF SELLER’S TRANSACTION100. GROSS AMOUNT DUE FROM BORROWER: 400. GROSS AMOUNT DUE TO SELLER:101. Contract sales price 401. Contract sales price

102. Personal property 402. Personal property

103. Settlement charges to borrower(line 1400) 403.104. 404.105. 405.

Adjustments for items paid by seller in advance Adjustments for items paid by seller in advance

106. City/town taxes to 406. City/town taxes to

107. County taxes to 407. County taxes to

108. Assessments to 408. Assessments to

109. 409.110. 410.111. 411.112. 412.120. GROSS AMOUNT DUE FROM BORROWER 420. GROSS AMOUNT DUE TO SELLER

200. AMOUNTS PAID BY OR IN BEHALF OF BORROWER: 500. REDUCTIONS IN AMOUNT DUE TO SELLER:201. Deposit of earnest money 501. Excess deposit (see instructions)

202. Principal amount of new loan(s) 502. Settlement charges to seller (line 1400)

203. Existing loan(s) taken subject to 503. Existing loan(s) taken subject to

204. 504. Payoff of first mortgage loan

205. 505. Payoff of second mortgage loan

206. 506.207. 507.208. 508.209. 509.

Adjustments for items unpaid by seller Adjustments for items unpaid by seller

210. City/town taxes to 510. City/town taxes to211. County taxes to 511. County taxes to212. Assessments to 512. Assessments to213. 513.214. 514.215. 515.216. 516.217. 517.218. 518.219. 519.220. TOTAL PAID BY/FOR BORROWER 520. TOTAL REDUCTION AMOUNT DUE SELLER

300. CASH AT SETTLEMENT FROM/TO BORROWER 600. CASH AT SETTLEMENT TO/FROM SELLER

301. Gross amount due from borrower(line 120) 601. Gross amount due to seller (line 420)

302. Less amounts paid by/for borrower(line 220) 602. Less reductions in amount due seller (line 520)

303. CASH (oo FROM) (oo TO) BORROWER 603. CASH (oo TO) (oo FROM) SELLER

L. SETTLEMENT CHARGES 63

700. TOTAL SALES/BROKER’S COMMISSION based on price $ @ %=PAID FROM

BORROWER’SFUNDS AT

PAID FROMSELLER’SFUNDS AT

Division of Commission (line 700) as follows: SETTLEMENT SETTLEMENT

701. $ to702. $ to703. Commission paid at Settlement704.800. ITEMS PAYABLE IN CONNECTION WITH LOAN801. Loan Origination Fee %802. Loan Discount %803. Appraisal Fee to804. Credit Report to805. Lender’s Inspection Fee806. Mortgage Insurance Application Fee to807. Assumption Fee808.809.810.811.900. ITEMS REQUIRED BY LENDER TO BE PAID IN ADVANCE901. Interest from to @$ /day902. Mortgage Insurance Premium for months to903. Hazard Insurance Premium for years to904. years to905.1000. RESERVES DEPOSITED WITH LENDER1001. Hazard Insurance months @ $ per month1002. Mortgage insurance months @ $ per month1003. City property taxes months @ $ per month1004. County property taxes months @ $ per month1005. Annual assessments months @ $ per month1006. months @ $ per month1007. months @ $ per month1008. Aggregate Adjustment months @ $ per month1100. TITLE CHARGES1101. Settlement or closing fee to1102. Abstract or title search to1103. Title examination to1104. Title insurance binder to1105. Document preparation to1106. Notary fees to1107. Attorney’s fees to

(includes above items numbers; )1108. Title Insurance to

(includes above items numbers; )1109. Lender’s coverage $1110. Owner’s coverage $1111.1112.1113.1200. GOVERNMENT RECORDING AND TRANSFER CHARGES1201. Recording fees: Deed $ ; Mortgage $ ; Releases $

1202. City/county tax/stamps: Deed $ ; Mortgage $

1203. State tax/stamps: Deed $ ; Mortgage $

1204.1205.1300. ADDITIONAL SETTLEMENT CHARGES1301. Survey to1302. Pest inspection to1303.1304.1305.1400. TOTAL SETTLEMENT CHARGES (enter on lines 103, Section J and 502, Section K)

64

Consumer Information on Home Purchasing and Related TopicsConsumer Information on Home Purchasing and Related Topics

U.S. Department of Housing and Urban DevelopmentU.S. Department of Housing and Urban Development451 7th Street, SWWashington, DC 20410 Web site: http://www.hud.gov

For information about FHA-insured home mortgage loans on one-to-four family dwellings call:

1-800 CALL FHA (800-225-5342)

For information about buying a HUD home call:

1-800-767-4HUD (800-767-4483)

For consumer counseling referrals call: 1-888-HOME4US (1-888-466-3487)

For information regarding housing discrimination issues contact:

Office of Fair Housing and Equal Opportunity (see above HUD address)1-800-669-9777Web site: http://www.hud.gov/fhe/fheo.html

For information about RESPA contact:

Office of Consumer and Regulatory Affairs (see above HUD address) Web Site: http://www.hud.gov/fha/res/respa_hm.html

Other AgenciesOther Agencies

For information about programs and pamphlets offered by the Department of Veterans Affairs, contactyour nearest VA Regional Office.Web Site: http://www.va.gov/vas/loan

65

For information about rural housing loan programs contact:

Department of AgricultureRural Development/Rural Housing ServicesStop 0783Washington, DC 20250Web Site: http://www.rurdev.usda.gov

For information about the Truth in Lending Act andthe Equal Credit Opportunity Act contact:

Federal Reserve Board20th Street and Constitution Avenue, NWWashington, DC 20551 http://www.bog.frb.fed.us

66

Home Warranty BenefitsThe HSA home warranty offers many benefits for sellers, buyers and real estate professionals.

Seller Benefits:

Free coverage during the listing period – When sellers commit to purchasing a warranty for the

buyer, they receive coverage, too.

Compelling point of difference to market their home – Most people – 8 out of 10 buyers – prefer

a warranted home.

Post-sale dispute prevention – If a mechanical system fails, the buyers calls HSA, not the

seller – and not you.

Buyer Benefits:

Comprehensive coverage – HSA’s basic coverage provides excellent protection, but if you want

even more, upgrade packages and additional options are available.

Convenient service – Between HSA’s service guarantee, friendly customer service

representatives, and prescreened vendors, buyers are treated right, from the closing to the claim

resolution.

Calming peace of mind – New homeowners have enough to worry about. Take the home’s

mechanical systems off the list.

Renewable protection – Your buyers won’t want to be without a home warranty plan ever again.

Renewing with HSA can keep a good thing going.

Agents have an advantage with HSA

HSA doesn’t just have your customers' needs in mind – a home warranty benefits YOU, too! If

there’s a mechanical failure after closing, the new homeowner will turn to HSA to solve the

problem, limiting your liability – and aggravation.

Get more from your home warranty with claims notifications

HSA is committed to helping you long after the sale. HSA understands that referrals help grow your

business. We give you more opportunities to start that conversation! When a claim is approved on

a warranted home, HSA will fax you a notification. You can use it as another way of keeping touch.

Additional touch points lead to additional referrals!

©2011 HSA.com | Web Design by BolderImage

Real Estate Professional

Order A Warranty

Home Warranty Benefits

Quality Service

Coverage and Cost

HSA Master Agent

Program

E & O Insurance

Order Marketing

Materials

Find Sales

Representative

H o m e | C o n t a c t | A b o u t U s R e s o u r c e C e n t e r Like262

67

February 2011

Homeowner Oil Heating System Upgrade and Insurance Law By September 30, 2011, you must upgrade your home heating system equipment to prevent leaks from tanks and pipes that connect to your furnace.

This fact sheet contains important information for those who heat their homes with oil. By September 30, 2011, you must upgrade your home heating system equipment to prevent leaks from tanks and pipes that connect to your furnace. By making a relatively small expenditure now, you can prevent a much greater expense in the future.

Massachusetts has a new law to address oil leaks from home heating systems (see Chapter 453 of the Acts of 2008, as most recently amended in 2010). This law has two major provisions that require:

the installation of either an oil safety valve or an oil supply line with protective sleeve on systems that do not currently have these devices; and

insurance companies that write homeowner policies to offer coverage for leaks from heating systems that use oil.

Most homeowner policies do not currently include such coverage, leaving many to pay for costly cleanups out of their own pocket. Although it is mandatory that insurance companies make this coverage available by July 1, 2010 to homeowners whose systems are upgraded, the insurance is an optional purchase.

Who must take action? Owners of 1- to 4-unit residences that are heated with oil must already have or install an oil safety valve or an oil supply

line with a protective sleeve, as shown in the diagram. These devices must be installed by a licensed oil burner technician. Technicians are employed by companies that deliver home heating oil or are self-employed. It is important to note that heating oil systems installed on or after January 1, 1990 most likely are already in compliance because state fire codes implemented these requirements on new installations at that time.

Who is exempt? Homeowners are exempt from taking these leak prevention steps if:

the oil burner is located above the oil storage tank and the entire oil supply line is connected to and above the top of the tank OR

an oil safety valve or oil supply line with protective sleeve was installed on or after January 1, 1990, AND

those changes comply with the oil burning equipment regulations; a copy of the oil burner permit from the local fire department may be used to demonstrate compliance.

Why comply? Not only is complying with the new law required, it makes good financial and environmental sense. Homeowners who take these preventive measures can avoid the disruption and expense that can be caused by heating oil leaks. A leak may result in exposure to petroleum vapors in your home. If the leak reaches the soil or groundwater beneath your house, then a cleanup must be performed to restore your

property to state environmental standards. Leaks that affect another property or impact drinking water supply wells can complicate the cleanup and increase the expense. Each year, several hundred Massachusetts families experience some kind of leak.

What will an upgrade cost? The typical cost of installing either an oil safety valve or oil supply line with a protective sleeve ranges from $150 - $350 (including labor, parts, and local permit fees).

What could it cost to cleanup a leak? The cleanup cost for a “simple” leak can be as much as $15,000. In cases where the leak affects the groundwater or is more extensive, the cleanup costs can reach $250,000 or more.

What kind of insurance is available? To be eligible for the new insurance coverage, homeowners must ensure that their oil heating systems are in compliance with the new law. Homeowners who have been certified to be in compliance with (or exempt from) the leak prevention measures qualify to purchase insurance that:

provides “first party coverage” of at least $50,000 for the cost of cleaning up a leak to soil, indoor air, or other

68

February 2011

environmental media from a home heating system at the residence itself and reimbursement for personal property damage, AND

provides “third party coverage” of at least $200,000 for the cost of dealing with conditions on and off the insured’s property because the leak from this system has or is likely to affect groundwater or someone else’s property. The coverage also includes costs incurred for legal defense, subject to a deductible not to exceed $1,000 per claim.

What should I do next? 1 Determine whether you have had

an oil safety valve or oil supply line with protective sleeve installed

since January 1, 1990. If you have, your permit from the fire department for the installation can be used to document your compliance. You can request a copy from the fire department if the permit is on file, or a licensed oil burner technician can certify that status on a form.

2 If you do not have an oil safety valve or oil supply line with protective sleeve in place, have one or the other installed and certified. Either contact your oil delivery company to ask if they employ a licensed oil burner technician or find one in your area. (A list of licensed technicians can be viewed at http://db.state.ma.us/dps/licenseelist.. Click on the “individuals” tab, scroll down to and then select “Oil Burner – Technician

Certificate” in the “Select a License Type” box, type in your city or zip code, and click “Search”).

3 Consider buying insurance coverage for the cleanup of a leak.

Determine whether your existing policy provides oil leak coverage.

If it does not, consider calling your homeowner insurance agent to amend the policy to include this coverage.

Find more information at http://www.mass.gov/dep/cleanup/laws/hhsl.htm

Diagram: Above‐Ground Home Heating Oil System Leak Prevention Upgrades

69

William Francis GalvinSecretary of the Commonwealth

updated 10/17/11

Massachusetts General Laws, Ch. 188, §1-10The Homestead Act

Questions and

Answers

70

William Francis GalvinSecretary of the CommonwealthCitizen Information ServiceOne Ashburton Place, Room 1611Boston, MA 02108Telephone: (617) 727-7030Toll-free: 1-800-392-6090 (in Mass. only)TTY: (617) 878-3889Email: [email protected]: www.sec.state.ma.us/cis

Dear Homeowner,This pamphlet has been designed to answer some of the basic questions asked every day pertaining to the Homestead Act. Any changes made by the new Homestead reform legislation, effective on March 16, 2011, are included. This information is not designed to provide any legal advice or address the practical effect of a estate of Homestead. As in all areas of the law, to fully understand your rights, you should consult an attorney of your choice.

If you have any further questions or concerns about how the Registry of Deeds can assist you in filing a declaration of Homestead, please do not hesitate to contact the Registry of Deeds office directly. We are here to serve you.

Sincerely,

William Francis GalvinSecretary of the Commonwealth

71

The Homestead Act • 1

What is a Declaration of Homestead/Homestead Protection?An estate of homestead is a type of protection for a person’s principal residence. There is an automatic homestead protection of one hundred and twenty-five thousand dollars ($125,000) with respect to a home that does not declare a homestead exemption with the Registry of Deeds. This automatic protection may be sufficient to protect a deposit made upon the estate; however, it is not likely to be sufficient coverage to protect the full value of your home. In order for homeowners in Massachusetts to protect the value of their property up to five hundred thousand dollars ($500,000) per residence, per family, you must file a document called a “Declaration of Homestead”. The form is filed at the Registry of Deeds in the county or district where the property is located, referencing the title/deed to the property.

Who can file a Homestead protection?The owner or owners of a home who occupy or intend to occupy the home as a principal residence may file a homestead protection. A sole owner, joint tenant, tenant by the entirety, tenant in common, life estate holder, or holder of a beneficial interest in a trust may all be regarded as owners. With respect to a home owned by joint tenants or tenants by the entirety, the homestead exemption remains whole and unallocated between the owners. If there are more than two (2) joint tenant owners, there is ability to add an additional two hundred and fifty thousand dollars ($250,000) to the exemption amount for additional joint tenants in certain cases. With respect to a home owned by multiple owners as either tenants in common or as trust beneficiaries, the homestead exemption shall be distributed among the owners in proportion to each of their ownership interests. Manufactured or mobile home owners are also eligible to declare homestead protection under the provisions of the new statute.

My home is held in trust, am I entitled to a Homestead protection?Yes, effective March 16, 2011, a holder of a beneficial interest in trust is considered an “owner,” eligible for

an estate of homestead. If your home is owned in trust, only the trustee shall execute a declaration of homestead on behalf of the trust’s beneficiaries. The trust declaration and or trustee certificates may also need to be recorded at the Registry of Deeds. In the declaration of homestead, the trustee must identify each of the beneficiaries to the trust that occupy or intend to occupy the premises as their principal residence. The spouses, if any, of any resident beneficiary must also be identified and each must state whether they also occupy or intend to occupy the premises as their principal residence.

Where do I file my Homestead?Each homestead must be filed in the county or district Registry of Deeds in which the residence is located. To acquire a homestead for a mobile home, also referred to as a manufactured home, you must file at the Registry of Deeds in which the mobile home is located. The Registry of Deeds must file your manufactured home declaration even though you do not have a deed on record.

Homestead forms may be obtained at www.sec.state.ma.us/rod and most Registries of Deeds. Links to your county or district’s website are also available. Forms are also available at legal stationery stores or your local attorney’s office. Be sure the form is filled out completely and has been properly notarized, and remember to enclose a check for the thirty five dollar ($35.00) recording fee when sending in your completed form. Checks should be made payable to the Commonwealth of Massachusetts.

How am I protected?The real property or manufactured home which serves as an individual’s principal residence upon filing a declaration of homestead shall be protected. A principal residence is considered to be the primary dwelling where an owner, and their family if applicable, reside or intend to reside. The declared estate of homestead shall protect against attachment, seizure, execution on judgment, levy or sale for the payment of debts to the extent of five hundred thousand dollars ($500,000) per residence, per family.

72


The declaration of homestead shall benefit each owner named on the homestead and each of the owner’s family members who occupy or intend to occupy the home as their primary residence. Each family member shall have the right to use, occupy and enjoy the home. The new law provides additional protections to spouses that are not listed as owners in their principal residences. For example, protection extends automatically to a new spouse where an unmarried person declared a homestead and later marries. Also, divorcing spouses are protected against the loss of homestead through termination or divorce. Neither divorce nor remarriage will affect the homestead of the spouse who still primarily resides in the home.

How am I protected if I am 62 or older, or disabled?The real property or manufactured home of persons sixty-two (62) years of age or older or of a disabled person, regardless of age, shall be protected against attachment, seizure, execution on judgment, levy or sale for the payment of debts.

Real property or manufactured homes must serve as an individual’s principal residence and each individual filing as either elderly or disabled will be eligible for protection up to a maximum amount of five hundred thousand dollars ($500,000) regardless of whether such declaration is filed individually or jointly with one another. Elderly persons, regardless of marital status, will be personally exempt up to five hundred thousand dollars ($500,000) each. If two (2) owners qualify for the elderly or disabled homestead protection, the aggregate protection on the home shall be one million dollars ($1,000,000).

Take note, each elderly or disabled homestead protection shall terminate upon the person’s death. If there are multiple owners and only one qualifies for an elderly or disabled homestead protection, it may be advisable to file one homestead declaration per owner in order to protect the family’s right to use, occupy and enjoy the home. Additionally, if there are dependent minor children, under the age of 21, living with all elderly or disabled homeowners, you may wish to

consult an attorney in order to adequately protect the children’s right to use, occupy and enjoy the home. Be sure to use the proper homestead form when you file.

What does the Homestead law mean by a “disabled person”?A disabled person is defined as an individual who has any medically determinable permanent physical or mental impairment that meets the disability requirement of supplemental social security income. In most cases, an individual is considered disabled – for the purpose of this law – if he or she cannot engage in any gainful activity as a result of the physical or mental impairment.

If you are declaring a homestead to benefit a disabled person, either an original or certified copy of the disability award letter issued by the United States Social Security Administration, or a certification letter signed by a licensed physician registered with the Massachusetts Board of Registration in Medicine must be attached to the homestead form. Disabled persons must meet the disability requirements stated in 42 U.S.C. 1382c(a)(3)(A) and 42 U.S.C. 1382c(a)(3)(C) as in effect at the time of recording.

Are my spouse and children covered, should I pass away?Yes. Should the parent who declares the homestead die, the law protects the family’s right to use, occupy and enjoy the home. Married persons, regardless of whether they both own the home, unmarried individuals and any minor children under the age of 21 shall all be protected by the homestead. The homestead protection shall continue despite the remarriage of a surviving or former spouse.

If I am over 62 and my spouse is under 62, should we both file?Yes. Pursuant to M.G.L. Chapter 188, Section 2(b), an elderly homestead protection for the individual over the age of 62 is personal to the qualifying individual and will terminate upon the transfer of their ownership interest, subsequent declaration of homestead on another property, abandonment or death. In order

73


to ensure that the homestead protection does not terminate unexpectedly for the spouse that is under the age of 62, one homestead should be filed per owner. This is a noteworthy change under the new law. Under the former statute, filing a new declaration of homestead voided any earlier homestead which could have opened up a claim period for previous creditors, leaving homeowners unprotected for a period of time. Effective March 16, 2011, a second homestead declaration shall relate back to the first declaration, thereby ensuring that the homeowners maintain their homestead protection.

When your spouse turns 62 and qualifies for an elderly homestead protection, you may also consider filing another elderly homestead on their behalf. If and when you and your spouse both qualify as elderly, you may aggregate each personal five hundred thousand dollar ($500,000) protection to one million dollar ($1,000,000). In all cases, you may want to consult an attorney to take any personal matters into consideration.

Will my Homestead declaration protect my home from being taken if I go into a nursing home?Liens imposed by the Massachusetts Department of Transitional Assistance (formerly Public Welfare), as a result of the payment of Medicaid benefits, are exempt from the homestead protection. However, as of the printing of this pamphlet, as long as the recipient, or the spouse of the recipient, is alive, the Commonwealth will not look to the residence for reimbursement of Medicaid benefits. If the surviving spouse is also the recipient of Medicaid benefits, the Commonwealth will file a claim for reimbursement from the estate for the entire amount of Medicaid benefits paid, once the surviving recipient has died. The rules and regulations regarding Medicaid are complicated and constantly changing. You should consult an attorney to address your specific concerns regarding Medicaid.

Is there anything I will not be protected from? The following are exempt from the homestead law:

• a sale for federal, state and local taxes, assessments, claims, and liens;

• a mortgage on the home;

• an execution issued from the Probate Court to enforce its judgment that a spouse pay for the support of a spouse, former spouse or minor children;

• where buildings on land not owned by the owner of a homestead estate are attached, levied upon or sold for the ground rent of the lot where they stand;

• upon an execution issued from a court of competent jurisdiction to enforce its judgment based upon fraud, mistake, duress, undue influence or lack of capacity;

• a lien on the home recorded prior to the creation of the homestead.

What happens to my Homestead if I should re-mortgage or take out a second mortgage or home equity loan?An estate of homestead shall be automatically subordinate to a mortgage on the home that is executed by all of the home’s owners. For homeowners that have previously executed a mortgage that included a waiver of the homestead protection, the new law applies to the existing homestead. This “waiver” shall be treated as a subordination and the previously recorded homestead shall be in full force and effect. As a result, there is no immediate need to file a new homestead declaration after you refinance, take out a second mortgage or a home equity loan. Although it is not necessary, it may be advisable in certain circumstances. Under the new law, you can file a new declaration without injury because the subsequent declaration shall relate back to the previous declaration.

Where there are multiple owners, if a mortgage is executed by fewer than all of the owners it shall still be subject to the estate of homestead and shall be considered superior only to the homestead estate of those owners who are parties to the new mortgage, their spouses and minor children, if any. The homestead

74


protections of those owners who were not parties to the new mortgage shall remain intact.

If I divide my time equally between my winter and summer residences, can I declare a Homestead on both?No. A homestead can be declared only on an applicant’s “principal residence”. A person can have more than one residence but the statute only allows the protection on one’s primary dwelling. There is no legislative intent to allow the exemption to apply to a vacation home that is not principal residence. For example, a husband cannot declare a homestead exemption on one residence while his wife declares the exemption on another family residence, unless each can prove that the residence is their principal residence. If a homestead declaration is filed for a vacation home and it is not your principal residence or you do not intend to reside in it as your primary dwelling, no protections shall apply. Also, the subsequent homestead on the vacation home shall terminate a prior homestead on an actual principal residence.

Does the Homestead protection take the place of home insurance?Absolutely not! The homestead protection is not a substitute for home insurance or any other type of liability insurance. These are separate and distinct types of protection. The homestead protection will be effective after any liability insurance is used to pay for any judgments that are related to liability incurred under that particular insurance policy (e.g. home, automobile, etc.).

What if my home is sold or damaged?If the home is sold, the sale proceeds shall be protected by the homestead for one (1) year after the date of the sale or on the date when a new home is purchased with the proceeds, which ever is earlier. If the home is damaged by a fire, for example, the insurance proceeds are protected for two (2) years after the date of the fire or on the date when the home is reconstructed or a new home is purchased, which ever is earlier. Pursuant to M.G.L. Chapter 188, Section 11(b), temporary

occupation of a trailer, manufactured home or other temporary housing shall not be considered a principal residency during the reconstruction or replacement of the home. Proceeds do not need to be kept in an escrow account in order to be afforded a homestead protection, although, it is advisable to consult with an attorney as escrow may provide other advantages. Any excess proceeds shall lose their homestead protection after reconstruction or when a new home is purchased.

How does the Homestead declaration help protect a home against unsecured creditors in bankruptcy proceedings?Remember that the homestead declaration protects a homeowner from unsecured creditors and certain other debts or attachments. It will not offer protection from first or second mortgage lenders and/or equity lenders who possess a security interest in a home. If payments are not current on these types of secured credit, a homeowner runs the risk of losing the home to foreclosure proceedings.

In a Chapter 7 bankruptcy, or asset liquidation proceeding, a homeowner is allowed to claim certain exemptions which function as asset protection allowances. If a homestead declaration is in place, and the state homestead exemptions are claimed, a homeowner would be allowed to retain a much greater portion of the proceeds from a liquidations sale of the home than s/he would be allowed to keep under federal bankruptcy law exemptions. This factor in turn decreases, or perhaps even eliminates, the possibility that the homeowner would be required to sell his/her home as part of Chapter 7 proceedings.

In all Chapter 13 bankruptcy proceedings, the court will require a homeowner to repay some or all of the unsecured debt over a three- to five-year period. You will be required to repay a percentage of that debt at least equal to that which the unsecured creditors would receive were a homeowner required to proceed under Chapter 7 liquidation regulations. By increasing the amount of the home’s exemption, the homestead declaration decreases the proceeds which would become available for repaying unsecured creditors

75


through the Chapter 7 alternative. This may decrease the percentage of the unsecured debt the homeowner would be required to repay through a Chapter 13 proposal.

Where can additional information be obtained about bankruptcy issues as they apply to Homestead protection?This information can be discussed with qualified counselors from the Consumer Credit Counseling Service, a private non-profit agency with chapters nationwide. In Massachusetts, contact the Consumer Credit Counseling Service of Southern New England (CCCS/SNE) at: (800) 208-2227. CCCS/SNE is a part of Money Management International and makes up the largest non profit, full service credit counseling agency in the United States. Since 1958, they have helped consumers find the tools and solutions they need to achieve financial independence. You can also visit their website at: www.moneymanagement.org.

Is the Homestead form difficult to understand and fill out?No. It simply asks for basic information. If your home is held in trust, the trustee(s) must fill out the form entitled “Declaration of Homestead for Homes Owned by Trustee(s).” For all other owners, or natural persons, please fill out the form entitled “Declaration of Homestead for Homes Owned by Natural Persons.” Be careful when writing the book and page number or certificate of title number of your deed or title. If you need assistance locating your deed to determine this information, please contact the Registry of Deeds. We are here to serve you.

Can my Homestead be terminated?Yes, the estate of homestead may be terminated by any of the following methods:

• if the home is conveyed by deed to a non-family member and the deed is signed by the owner and if applicable, a non-owner spouse or former spouse residing in the home as a principal residence at the time the deed is drafted;

• a recorded release of the homestead is signed and acknowledged by the owner and if applicable, a non-owner spouse or former spouse residing in the home at the time of the release;

• abandonment of the home as a principal residence by the owner, owner’s spouse, former spouse or minor children, only as they apply to rights of the persons who abandoned the home. Military service shall not be considered abandonment;

• if the deed is held in trust, either the trustee or a beneficial owner identified in the homestead declaration records a termination on the property held in trust.; or

• if a subsequent homestead declaration is made on another home, such as a vacation home, it shall terminate a prior homestead on an actual principal residence.

Please note, there are a number of transfers that do not terminate an already declared homestead. Any transfer of the property between spouses, former spouses, co-owners, a trustee and a beneficiary or a life tenant and a remainderman will not terminate a previously declared homestead. Also, if a conveyance or release is made without the signature and acknowledgement of a non-owner spouse or former spouse who is residing in the home at the time the principal residence is conveyed or released by an owner, it shall not affect the homestead of the spouse who failed to sign.

What is the filing fee?The cost of filing the Declaration of Homestead is thirty five dollars ($35.00). Checks should be made payable to the Commonwealth of Massachusetts. Each owner, whether or not they qualify for an elderly or disabled exemption, must sign and acknowledge the document under the penalties of perjury before a notary public. If the home is owned by two spouses, the declaration must be executed by both spouses. If the home is owned by one spouse independently, only that spouse needs to sign the declaration, however,

76


they must declare their spouse and state the spouse’s name. If there is more than one owner, given that the tenancy may change, it may be advisable to file a separate declaration for each tenant. You may wish to consult an attorney if you have numerous owners.

How can I tell if my real property is recorded or registered land?In the large majority of cases your real property is recorded land. Your evidence of title will be a quitclaim deed that has a book and page number assigned by the Registry of Deeds.

If your property is registered land, you will have a certificate of title number perhaps in addition to a land registration office book and page. Instead of a quitclaim deed, you may have received a certified copy

of your certificate of title. Prior to April 9, 1997, a large document called an owner’s duplicate certificate of title was issued instead. If you are not sure whether your real property is recorded or registered, contact the Registry of Deeds.

Chapter 395 of the Acts of 2010 states that all existing estates of homestead in effect on the effective date of this Act, March 16, 2011, shall continue in full force and effect notwithstanding the repeal of any law under which they were created. Additionally, all existing estates of homestead shall now be governed by this new statute even though the execution of each does not comply with the new M.G.L. Chapter 188, Section 5.

77

The Commonwealth of MassachusettsWilliam Francis Galvin, Secretary of the Commonwealth

Declaration of Homestead for Homes Owned by Natural Persons (General Laws Chapter 188)In situations where the home is owned by multiple owners, each owner may be best served to complete a separate declaration of homestead.

1. I, _______________________________________________________________, (insert name of owner)

We, ______________________________________________________________, (insert name of owners)

_________________________________________________________________,

_________________________________________________________________,

hereby declare homestead pursuant to M.G.L. c.188 and state that I/we own the home described below and occupy or intend to occupy the home as my/our principal residence.

Owner Information

2. Check all the apply:

I/we, _____________________________________________________________________ am elderly (62 years of age or older). (insert name (s))

I/we, _________________________________________________________________________________________________ (insert name (s))

am/are disabled (have a physical or mental impairment that meets the disability requirements for Supplemental Security Income under 42 U.S.C. 1382c(a)(3)(A) and 42 U.S.C. 1382c(a)(3)(C). One of the following must be attached: 1) an original or certified copy of a disability award letter issued to the person by the United States Social Security Administration, or 2) a letter signed by a physician registered with the board of registration in medicine certifying that each person meets the disability requirements stated in 42 U.S.C. 1382c(a)(3)(A) and 42 U.S.C. 1382c(a)(3)(C).

I am married to _________________________________________________________________________________________ , who is not a co-owner of the home but who occupies or intends to occupy the home as his/her principal residence.

Home Information

3. Address: ______________________________________________________________________________________ , Massachusetts. (street number and name, city/town)

4. Select ONE of the following:

Deed is recorded in __________________________________ Registry of Deeds in ______________ and _______________ (district/county) (book) (page)

Certificate of Title _________________ registered in the Land Registration Office ______________ and _______________ (number) (book) (page)

Inheritance from _________________________________________________________________________ , Docket number (name of previous owner)

_______________________________________________ in ________________________________________________. (number) (county)

For manufactured homes, license number __________________________________________________________________ . (number)

Filing Fee $35

(over)Declaration of Homestead for Homes Owned by Natural Persons - Page 1 of 2 78

5. I/we, whose names are signed on this document, acknowledge that I/we sign it voluntarily for its stated purpose.

To be signed by Applicant(s) in front of Notary Public.

Signed under pains and penalties of perjury this

_______________________________________________day of _____________________________________________ , 20 ______.

____________________________________________________________________________________________________

____________________________________________________________________________________________________

____________________________________________________________________________________________________

For Use by Notary Public Only:

COMMONWEALTH OF MASSACHUSETTS

_______________________________________________, ss.

________________________________________, 20 ______ , before me, the undersigned notary public, personally appeared

____________________________________________________________________________________________________ , (name(s) of the document signer(s))

proved to me through satisfactory evidence of identification, which were ___________________________________________ , (drivers license, passport, etc.)

to be the person(s) who signed the preceding or attached document in my presence, and who swore or affirmed to me that the contents of the document are truthful and accurate to the best of (his) (her) (their) knowledge and belief.

Notary Public: ____________________________________________________________________________________________

My commission expires: _____________________________________________________________________________________

Declaration of Homestead for Homes Owned by Natural Persons - Page 2 of 2 79

The Commonwealth of MassachusettsWilliam Francis Galvin, Secretary of the Commonwealth Declaration of Homestead for Homes Owned by Trustee(s) (General Laws Chapter 188)

1. I, ________________________________________________________ , Trustee (insert name of owner)

We, ______________________________________________________________, (insert name of owners)

__________________________________________________________, Trustees

of certain trust _____________________________________________________ (trust name)

_________________________________________________________________,

dated _______________ and recorded ________________and________________ (date) (book) (page)

hereby declare homestead pursuant to M.G.L. c.188 and state that I/we own the home described below and which the beneficiaries listed herein occupy or intend to occupy as his/her/their principal residence:

Beneficiary Information2. Enter beneficiary name(s): _____________________________________________________________________________________ (insert beneficiary name(s))3. Check all that apply and enter beneficiary name(s):

________________________________________________________________________is/are elderly (62 years of age or older). (insert beneficiary name(s))

_____________________________________________________________________________________________________ (insert beneficiary name(s))

is/are disabled (have a physical or mental impairment that meets the disability requirements for Supplemental Security Income under 42 U.S.C. 1382c(a)(3)(A) and 42 U.S.C. 1382c(a)(3)(C). One of the following must be attached: 1) an original or certified copy of a disability award letter issued to the person by the United States Social Security Administration, or 2) a letter signed by a physician registered with the board of registration in medicine certifying that each person meets the disability requirements stated in 42 U.S.C. 1382c(a)(3)(A) and 42 U.S.C. 1382c(a)(3)(C).

4. For each applicable beneficiary, complete one statement. Attach additional page(s) as necessary.

__________________________________________ is married to ________________________________________________who is not a co-owner of the home but who occupies or intends to occupy the home as his/her principal residence.

__________________________________________ is married to ________________________________________________who is not a co-owner of the home but who occupies or intends to occupy the home as his/her principal residence.

Home Information

5. Address: ______________________________________________________________________________________ , Massachusetts. (street number and name, city/town)6. Select ONE of the following:

Deed is recorded in __________________________________ Registry of Deeds in ______________ and _______________ (district/county) (book) (page)

Certificate of Title _________________ registered in the Land Registration Office ______________ and _______________ (number) (book) (page)

Inheritance from _________________________________________________________________________ , Docket number (name of previous owner)

_______________________________________________ in ________________________________________________. (number) (county)

For manufactured homes, license number __________________________________________________________________ . (number)

Filing Fee $35

(over)Declaration of Homestead for Homes Owned by Trustee(s) - Page 1 of 2 80

7. I/we, the trustee(s) whose name(s) are signed on this document, acknowledge that I/we sign it voluntarily for its stated purpose.

To be signed by Applicant(s) in front of Notary Public.

Signed under pains and penalties of perjury this

_______________________________________________day of _____________________________________________ , 20 ______.

____________________________________________________________________________________________________

____________________________________________________________________________________________________

____________________________________________________________________________________________________

For Use by Notary Public Only:

COMMONWEALTH OF MASSACHUSETTS

_______________________________________________, ss.

________________________________________, 20 ______ , before me, the undersigned notary public, personally appeared

____________________________________________________________________________________________________ , (name(s) of the document signer(s))

proved to me through satisfactory evidence of identification, which were ___________________________________________ , (drivers license, passport, etc.)

to be the person(s) who signed the preceding or attached document in my presence, and who swore or affirmed to me that the contents of the document are truthful and accurate to the best of (his) (her) (their) knowledge and belief.

Notary Public: ____________________________________________________________________________________________

My commission expires: _____________________________________________________________________________________

Declaration of Homestead for Homes Owned by Trustee(s) - Page 2 of 2 8107/24/2012

http://www.sec.state.ma.us/rod/rodhom/Homestead_q_and_a.pdf

095907-500135-5690861Kurt Thompson | RE/MAX Property Promotions | [email protected] |

82


83


84


85


86


87


88


89


90


91


92

108

07/24/2012

http://www.epa.gov/lead/pubs/leadpdfe.pdf

Chapter 11.2

Introduction Nutrition is an important factor in the prevention and treatment of lead toxicity. Thenutrients received from certain foods and supplements help protect the individualfrom lead in the environment and from lead stored in the bones. For example, a childwith an adequate iron status will absorb less lead than a child with iron deficiency. Apregnant woman who has a low dietary calcium intake may release stored lead fromher bones into her blood, where it becomes available to the fetus. The role of nutritional status in altering susceptibility to lead is well recognized.Overall, a child or adult in excellent nutritional status is partially protected from leadtoxicity. Conversely, a compromised nutritional state makes one more susceptible tolead toxicity. Sound nutritional guidelines for children are compatible withrecommendations for lead poisoning prevention. Sources of Nutritional Lead Exposure Water Water is the main source of dietary lead. Infants and young children may consumelarge quantities of water in formula and other liquids. Lead levels of drinking water can increase when the water is heated and/or remainsin contact with lead-containing plumbing for extended periods of time, especially inareas where water is corrosive (soft). Water can be the source of lead in reconstitutedjuices and beverages, foods boiled or prepared using large amounts of leadcontaminated water. Because of the volume consumed, formula made with lead-contaminated water isespecially dangerous to infants. Formula high in lead can result from using water thatwas 1) first-draw morning water; 2) drawn from the hot water tap; 3) boiled longerthen 10 minutes (causing lead to concentrate); and/or 4) boiled in lead-containingvessels. To minimize lead exposure from water, use only water from the cold water tap. If taphas not been used for 6 hours or longer, run the tap water for 2-3 minutes or until icycold before beginning formula or food preparation. If lead level in tap water is ofconcern, bottled water should be used for mixing formula. If water for formula isboiled, time carefully and limit boiling time to 5 minutes. Lead contaminated water is rarely identified as a source of lead in Wisconsinchildren, the primary cause being deteriorated lead-based paint. However, to rule outlead as a source of exposure, water testing can be done through the Wisconsin StateLaboratory of Hygiene (608-262-1293). Food Containers Containers with elements of lead can contaminate food that is cooked, stored ortransported in the container. Lead-soldered cans, lead glazed pottery, cracked orchipped pottery, and leaded crystal can all be sources of lead in food. The longer thefood or beverage is exposed to a leaded container, the more contaminated it willbecome. Hot and/or acidic liquids also promote the leaching of lead from containers.

109

Chapter 11.3

While the U.S. has prohibited lead soldering of food containers and regulates leadcontent in pottery glaze, imported foods or dishes may continue to be a source forlead contamination of food. Supplements Natural calcium supplements such as bonemeal, oyster shells, and dolomite can alsobe contaminated with lead. Pregnant women should especially be cautious of thesesources of calcium supplement. Soil Lead can enter the food chain when vegetables and fruits are grown in soil that iscontaminated with lead. Lead-contaminated soil is most often found next to oldpainted buildings, near roadways, near manufacturing and renewal/demolition sites,and in old orchards (from the use of fertilizers/pesticides containing lead). Leafy androot vegetables are most likely to become lead-contaminated because of their highwater content, large surface exposure, and direct contact with the soil. Dust fromtraffic, remodeling, demolition, and manufacturing can contaminate garden produce,food preparation surfaces, and foods that are not protected from dust by covers orwrappings. Lead from soil and dust can also be ingested by infants and very young children whomouth objects or their hands. Using a pacifier helps prevent the hand-to-mouthtransfer of lead especially when playing outdoors and in other environments that arelikely to be lead-contaminated. Since children often drop pacifiers, they should becleaned frequently to remove any lead dust contamination. Careful handwashingbefore eating and after play can decrease lead exposure from these sources. Diet and Eating Patterns Minimize Lead Toxicity The timing and types of nutrients in the diet can assist in decreasing the absorption oflead into a child’s body. Fortunately, these recommendations are also part of soundnutritional counseling.

Regular Meals and Snacks Decrease Lead Absorption Stomachs that are full are less able to absorb lead. Gastrointestinal (GI) absorption oflead is 3 to 4 times greater during periods of fasting than during periods of feeding.Infants, young children, and pregnant women should consume well-balanced mealsand snacks at regular intervals during waking hours to help prevent lead absorption.Infants and young children need to be fed at least every 3 to 4 hours. Calcium The more calcium a child has, the less lead is retained by their body. Calcium andlead seem to compete for absorption in the GI tract and for storage sites in the bones.Remobilization and subsequent elevation of blood lead levels occurs most readilywhen dietary calcium intakes are low and/or when calcium needs are increased, asduring pregnancy, periods of bone growth, lactation, and following bone fractures. Acombination of calcium and phosphorus in the diet further reduces lead absorption,making plant sources of calcium especially effective in preventing lead absorption. Iron

110

Chapter 11.4

Iron deficient individuals absorb 2 to 3 times more lead than individuals with adequatelevels of blood iron. Iron and lead interact and compete in heme synthesis. Evenslight decreases in hematocrit allow increased lead absorption. In addition, moresevere anemia occurs when both lead toxicity and iron-deficient diets are present.Iron supplementation lowers lead levels in children and lead-exposed women. Seethe section entitled Medical Management of Lead Poisoned Children for moreinformation on the diagnosis, affects, and treatment of anemia associated with leadpoisoning. Diets rich in Vitamin C enhance iron absorption. Figure 11.1 Foods that Reduce Lead Absorption are those rich in . . .

Calcium: milk, cheese, yogurt, kale, collards, turnip greens, canned salmon. sardines withbones

Iron: lean meats and poultry, seafood, cereals and breads fortified with iron, peanut butter,nuts, dried beans & peas, raisins, prunes, prune juice, greens such as broccoli and spinach

Vitamin C: tomatoes, oranges and grapefruits and juices, juices fortified with vitamin C,strawberries, kiwi, green peppers, watermelon, cantaloupe, potatoes

Offer more of these! Other nutrients can help the body to reduce the toxic effects of lead that is absorbed.Zinc, thiamin, and vitamin E all play this role. Families may be unfamiliar with foodsthat contain these nutrients. Figure 11.2 Foods Rich In Zinc, Vitamin E, Thiamin . . .Reduce the Toxic Effects of Lead Zinc Vitamin E Thiamin Lean red meats Vegetable oils Whole grain foods Eggs Wheat germ Organ meats Fish & seafood Nuts Lean pork Milk & cheese Legumes

Offer more of these! In animal studies, unbalanced diets with high levels of fat or protein resulted inincreased absorption of lead, while moderate dietary intakes of protein and fat appearto help prevent lead toxicity. Limiting high fat foods in a diet contributes to overallhealth, as well as helping in lead poisoning. A balanced diet containing a variety of foods provided at regularly scheduled mealsand snacks will assure optimal nutritional status for the children and other familymembers.

111

Chapter 11.5

Figure 11.5 High Fat Foods . . . Increase Absorption of Lead Shortening, lard, oil Margarine, butter Mayonaise Fried foods Chips & other fried snacks Pastry, donuts Lunchmeats, hot dogs Candy bars Sausage, bacon

Offer less of these!

Iron Deficiency and Lead PoisoningIron deficiency can enhance lead absorption and often co-exists with lead poisoning.In addition, research indicates that iron deficiency in young children can be anindependent neurotoxin, as well as enhancing the effects of lead poisoning on thecentral nervous system.

Adequate iron intake lowers lead absorption, and should be considered a primary toolin decreasing the effects of exposure to lead hazards. While the effect of lead on redblood cell production rarely occurs until BLLs reach around 40�g/dL, low iron storespromote absorption of lead at any blood lead level. Over half of US children 1-2years of age have daily iron intake below recommended amounts. When exposed tolead hazards, these children may see the lasting effects on cognitive developmentdue to both iron deficiency in infancy and the long lasting negative effects due to lead.

All children with BLLs >10�g/dL should be evaluated for iron deficiency. Serum ironand iron binding capacity are the tests of choice, as they are the most sensitiveindicators of iron status. If iron deficiency is diagnosed, treatment should begin alongwith treatment of the lead exposure. Note: Children receiving BAL (dimercaprol) as achelating agent should not be treated for iron deficiency until the drug therapy iscompleted.

Screening for Lead Poisoning & Education in WIC ClinicsBecause of the close tie between nutrition and lead poisoning, and because childrenregularly receive a finger stick as part of the WIC (Women, Infants, and ChildrenNutrition Program) certification, WIC clinics are opportune sites for blood lead testingand nutrition counseling related to lead poisoning. For the last 3 years, WCLPPP hasworked closely with the Wisconsin WIC program to facilitate blood lead testing at WICproject sites.

Many local WIC sites offer blood lead testing in collaboration with local healthdepartments and managed care organizations. An analysis of BLLs of childrenenrolled in WIC indicates they have a higher incidence of lead poisoning then non-WIC enrollees.

The state WIC and WCLPPP programs have collaborated to modify the functions ofthe WIC data collection system (DAISy) to improve tracking of blood lead tests ofchildren coming in for recertification. There are non-mandatory fields in DAISy that,

112

Chapter 11.6

once activated, allow WIC staff to enter the date and result of a lead test, and if it wasdrawn at the WIC clinic. Once that data is entered for a child, DAISy will flag the childat the next recertification if they are due for a lead test.

The nutrition education card series developed by WIC includes the care entitled“Eating Right: Preventing Childhood Lead Poisoning”) gives nutrition and other tipsthat decrease lead toxicity. WIC and local health agencies can order it from theDepartment of Health and Family Services Forms Center (POH 4968) form usingDMT-25. See Chapter 6 for further information on educational materials related tonutrition and lead poisoning. It is important to note that federal limitations do not allow the use of federal WIC fundsto be used to obtain blood lead tests. LHDs must negotiate with the WIC project oncompensation for time and training required to include lead testing in WIC clinic flow.

References Andrews, K.; Savitz, D.; Hertz-Picciotto, I. "Prenatal Lead Exposure in Relation toGestational Age and Birth Weight: A Review of Epidemiologic Studies." AmericanJournal of Industrial Medicine 26, 1994, pp. 13-32. Baldini, M.; Coni, E.; Mantovani, A.; Stacchini, A.; Zanasi, F. "Effect of Unbalanced Diets on Long Term Metabolism of a Toxicant 1. Lead in Rats:Preliminary Note.” Food Add and Contaminants 6 (1), 1989, pp. 117-124. Reichlmayr Lair, A.M.; Kirchgessner, M. Edited by Earl Friedman. "Lead."Biochemistry of the Essential Ultratrace Elements. New York, NY: Plenum Press,1984, pp. 367-387. Frisancho, A. R.; Ryan, A. S. "Decreased Stature Associated With Moderate Blood Lead Concentrations in Mexican American Children." American Journal ofClinical Nutrition. 54 (3), September 1991, pp. 516-519. "Lead in 'Natural' Calcium Pills Still Causes Concern." Tufts Univ Diet Nutr Letter. 5(9), November 1987, pp. 2. Lucas, S.; Sexton, M.; Langenberg, P. “Relationship Between Blood Lead andNutritional Factors in Preschool Children: A Cross-Sectional Study.” Pediatrics97(1), 1996, pp. 74-78. Mahaffey, K. "Environmental Lead Toxicity: Nutrition as a Component of Intervention."Env Health Pros. 89, 1990, pp. 75-78. Mahaffey, K. “Nutrition and Lead: Strategies for Public Health.” Env HealthPerspectives 103 (Suppl 6), 1995, pp. 191-196. "The Pollutants That Matter Most: Lead, Radon, Nitrate.” Consumer Report.Consumer Union U.S. 55 (1), January 1990, pp. 30-32. Sargeant, J. "The Role of Nutrition in the Prevention of Lead Poisoning in Children."Pediatric Annals 23, November 1994, pp. 636-642.

113

Chapter 11.7

Schwartz, J.; Angel, C.; Pitcher, H. "Relationship Between Childhood Blood LeadLevels and Stature." Pediatrics 77 (3), March 1986, pp. 281-288. Shannon, M.; Graef, J. W. "Lead Intoxication: From Lead-Contaminated Water Usedto Reconstitute Infant Formula." Clin Pediatr. 28 (8), August 1989, pp. 380-382. Watson, W. S.; Morrison, J.; Bethel, M. I. F.; Baldwin, N. M.; Lyon, D.T. B.; Dobson,H.; Moore, M. R.; Hume, R. "Food Iron and Lead Absorption in Humans.” An J ClinNutr. 44 (2), August 1986, pp. 248-256. Yip, R. "Iron Deficiency and Childhood Lead Poisoning." Functional Significance ofIron Deficiency. Ed. Cyril O. Enwonwo. Meharry Medical College, Fall 1990. Revised 10/9/2003

114

07/12/2012

http://www.dhs.wisconsin.gov/lead/doc/Chap11Nutrition.pdf

This Guide provides

information and guidance

for homeowners and

renters on how to clean

up residential mold

problems and how to

prevent mold growth.

EPA 402-K-02-003(Reprinted 09/2010)

U.S. Environmental Protection AgencyOffice of Air and Radiation

Indoor Environments Division1200 Pennsylvania Avenue, N. W.

Mailcode: 6609JWashington, DC 20460

www.epa.gov/iaq

115

1

Contents Page

Mold Basics Why is mold growing in my home? 2 Can mold cause health problems? 2 How do I get rid of mold? 3

Mold Cleanup Who should do the cleanup? 4

Mold Cleanup Guidelines 6

What to Wear When Cleaning Moldy Areas 8

How Do I Know When the Remediation or Cleanup is Finished? 9

Moisture and Mold Prevention and Control Tips 10 Actions that will help to reduce humidity 11 Actions that will help prevent condensation 12 Testing or sampling for mold 13

Hidden Mold 14

Cleanup and Biocides 15

Additional Resources 16

A Brief Guide to Mold, Moisture, And Your HoMe

116

Mold Basics

hy is mold growing in my home? Molds are part of the natural environment. Outdoors, molds play a part in nature by breaking down dead organic matter such as fallen leaves and dead trees, but indoors, mold growth should be avoided. Molds reproduce by means of tiny spores; the spores are invisible to the naked eye and float through outdoor and indoor air. Mold may begin growing indoors when mold spores land on surfaces that are wet. There are many types of mold, and none of them will grow without water or moisture.

can mold cause health problems? Molds are usually not a problem indoors, unless mold spores land on a wet or damp spot and begin growing. Molds have the potential to cause health problems. Molds produce allergens (substances that can cause allergic reactions), irritants, and in some cases, potentially toxic substances (mycotoxins).

Inhaling or touching mold or mold spores may cause allergic reactions in sensitive individuals. Allergic responses include hay fever-type symptoms, such as sneezing, runny nose, red eyes, and skin rash (dermatitis). Allergic reactions to mold are common. They can be immediate or delayed. Molds can also cause asthma attacks in people with asthma who are allergic to mold. In addition, mold exposure can irritate the eyes, skin, nose, throat, and lungs of both mold-

2

■ The key to mold control is moisture control.

■ If mold is a problem in your home, you should clean up the mold promptly and fix the water problem.

■ It is important to dry water-damaged areas and items within 24-48 hours to prevent mold growth.

W

Mold growing outdoors on firewood. Molds come in many colors; both white and black molds are shown here.

117

3

allergic and non-allergic people. Symptoms other than the allergic and irritant types are not commonly reported as a result of inhaling mold.

Research on mold and health effects is ongoing. This brochure provides a brief overview; it does not describe all potential health effects related to mold exposure. For more detailed information consult a health professional. You may also wish to consult your state or local health department.

How do i get rid of mold? It is impossible to get rid of all mold and mold spores indoors; some mold spores will be found floating through the air and in house dust. The mold spores will not grow if moisture is not present. Indoor mold growth can and should be prevented or controlled by controlling moisture indoors. If there is mold growth in your home, you must clean up the mold and fix the water problem. If you clean up the mold, but don’t fix the water problem, then, most likely, the mold problem will come back.

Magnified mold spores.

Molds can gradually destroy the things they grow on. You can prevent damage to your home and furnishings, save money, and avoid potential health problems by controlling moisture and eliminating mold growth.

118

4

Who should do the cleanup? Who should do the cleanup depends on a number of factors. One consideration is the size of the mold problem. If the moldy area is less than about 10 square feet (less than roughly a 3 ft. by 3 ft. patch), in most cases, you can handle the job yourself, following the guidelines below. However:

■ If there has been a lot of water damage, and/or mold growth covers more than 10 square feet, consult the U.S. Environmental Protection Agency (EPA) guide: Mold Remediation in Schools and Commercial Buildings. Although focused on schools and commercial

cleaNuP

If you already have a

mold problem – act QuicKlY. Mold damages what it

grows on. The longer

it grows, the more

damage it can cause.

Leaky window – mold is beginning to rot the wooden frame and windowsill.

Mold

119

5

buildings, this document is applicable to other building types. It is available on the Internet at: www. epa.gov/mold.

■ If you choose to hire a contractor (or other professional service provider) to do the cleanup, make sure the contractor has experience cleaning up mold. Check references and ask the contractor to follow the recommendations in EPA’s Mold Remediation in Schools and Commercial Buildings, the guidelines of the American Conference of Governmental Industrial Hygenists (ACGIH), or other guidelines from professional or government organizations.

■ If you suspect that the heating/ventilation/air conditioning (HVAC) system may be contaminated with mold (it is part of an identified moisture problem, for instance, or there is mold near the intake to the system), consult EPA’s guide Should You Have the Air Ducts in Your Home Cleaned? before taking further action. Do not run the HVAC system if you know or suspect that it is contaminated with mold - it could spread mold throughout the building. Visit www.epa. gov/iaq/pubs to download a copy of the EPA guide.

■ If the water and/or mold damage was caused by sewage or other contaminated water, then call in a professional who has experience cleaning and fixing buildings damaged by contaminated water.

■ If you have health concerns, consult a health professional before starting cleanup.

Mold

120

6

tips and techniques The tips and techniques presented in this section will help you clean up your mold problem. Professional cleaners or remediators may use methods not covered in this publication. Please note that mold may cause staining and cosmetic damage. It may not be possible to clean an item so that its original appearance is restored.

■ Fix plumbing leaks and other water problems as soon as possible. Dry all items completely.

■ Scrub mold off hard surfaces with detergent and water, and dry completely.

Places that are often or always damp can be hard to maintain completely free of mold. If there’s some mold in the shower or elsewhere in the bathroom that seems to reappear, increasing the ventilation (running a fan or opening a window) and cleaning more frequently will usually prevent mold from recurring, or at least keep the mold to a minimum.

Bathroom Tip

Mold cleaNuP Guidelines

Mold growing on the underside of a plastic lawnchair in an area where rainwater drips through and deposits organic material.

121

■ Absorbent or porous materials, such as ceiling tiles and carpet, may have to be thrown away if they become moldy. Mold can grow on or fill in the empty spaces and crevices of porous materials, so the mold may be difficult or impossible to remove completely.

■ Avoid exposing yourself or others to mold (see discussions: What to Wear When Cleaning Moldy Areas and Hidden Mold.)

■ Do not paint or caulk moldy surfaces. Clean up the mold and dry the surfaces before painting. Paint applied over moldy surfaces is likely to peel.

■ If you are unsure about how to clean an item, or if the item is expensive or of sentimental value, you may wish to consult a specialist. Specialists in furniture repair, restoration, painting, art restoration and conservation, carpet and rug cleaning, water damage, and fire or water restoration are commonly listed in phone books. Be sure to ask for and check references. Look for specialists who are affiliated with professional organizations.

7

Mold growing on a piece of ceiling tile.

122

8

■ Avoid breathing in mold or mold spores. In order to limit your exposure to airborne mold, you may want to wear an N-95 respirator, available at many hardware stores and from companies that advertise on the Internet. (They cost about $12 to $25.) Some N-95 respirators resemble a paper dust mask with a nozzle on the front, others are made primarily of plastic or rubber and have removable cartridges that trap most of the mold spores from entering. In order to be effective, the respirator or mask must fit properly, so carefully follow the instructions supplied with the respirator. Please note that the Occupational Safety and Health Administration (OSHA) requires that respirators fit properly (fit testing) when used in an occupational setting; consult OSHA for more information (800-321-OSHA or osha.gov/).

What to Wear When

cleaNiNG

Moldy areas

Mold growing on a suitcase stored in a humid basement.

It is important

to take

precautions to

liMit Your

exPosure

to mold and

mold spores.

123

9

How do i know when the remediation or cleanup is finished? You must have completely fixed the water or moisture problem before the cleanup or remediation can be considered finished.

■ You should have completed mold removal. Visible mold and moldy odors should not be present. Please note that mold may cause staining and cosmetic damage.

■ You should have revisited the site(s) shortly after cleanup and it should show no signs of water damage or mold growth.

■ People should have been able to occupy or re-occupy the area without health complaints or physical symptoms.

■ Ultimately, this is a judgment call; there is no easy answer.

■ Wear gloves. Long gloves that extend to the middle of the forearm are recommended. When working with water and a mild detergent, ordinary household rubber gloves may be used. If you are using a disinfectant, a biocide such as chlorine bleach, or a strong cleaning solution, you should select gloves made from natural rubber, neoprene, nitrile, polyurethane, or PVC (see Cleanup and Biocides). Avoid touching mold or moldy items with your bare hands.

■ Wear goggles. Goggles that do not have ventilation holes are recommended. Avoid getting mold or mold spores in your eyes.

What to Wear When

cleaNiNG

Moldy areas

Cleaning while wearing N-95 respirator, gloves, and goggles.

124

10

■ When water leaks or spills occur indoors - ACT QUICKLY. If wet or damp materials or areas are dried 24-48 hours after a leak or spill happens, in most cases mold will not grow.

■ Clean and repair roof gutters regularly.

■ Make sure the ground slopes away from the building foundation, so that water does not enter or collect around the foundation.

■ Keep air conditioning drip pans clean and the drain lines unobstructed and flowing properly.

Moisture and Mold PreVeNtioN and control tips

MoistureControl is the Key to Mold Control

Mold growing on the surface of a unit ventilator.

125

11

■ Keep indoor humidity low. If possible, keep indoor humidity below 60 percent (ideally between 30 and 50 percent) relative humidity. Relative humidity can be measured with a moisture or humidity meter, a small, inexpensive ($10-$50) instrument available at many hardware stores.

■ If you see condensation or moisture collecting on windows, walls or pipes - ACT QUICKLY to dry the wet surface and reduce the moisture/water source. Con densation can be a sign of high humidity.

Actions that will help to reduce humidity:

Vent appliances that produce moisture, such as clothes dryers, stoves, and kerosene heaters to the outside where possible. (Combustion appliances such as stoves and kerosene heaters produce water vapor and will increase the humidity unless vented to the outside.)

Use air conditioners and/or de-humidifiers when needed.

Run the bathroom fan or open the window when showering. Use exhaust fans or open windows whenever cooking, running the dishwasher or dishwashing, etc.

Condensation on the inside of a window-pane.Moisture

Control is the Key to Mold Control

126

12

Actions that will help prevent condensation:

Reduce the humidity (see preceeding page).

Increase ventilation or air movement by opening doors and/or windows, when practical. Use fans as needed.

Cover cold surfaces, such as cold water pipes, with in-sulation.

Increase air temperature.

Mold growing on a wooden headboard in a room with high humidity.

127

renters: Report all plumbing leaks and moisture problems immediately to your building owner, manager, or superintendent. In cases where persistent water problems are not addressed, you may want to contact

local, state, or federal health or housing authorities.

13

testing or sampling for mold Is sampling for mold needed? In most cases, if visible mold growth is present, sampling is unnecessary. Since no EPA or other federal limits have been set for mold or mold spores, sampling cannot be used to check a building’s compliance with federal mold standards. Surface sampling may be useful to determine if an area has been

adequately cleaned or remediated. Sampling for mold should be conducted by professionals who have specific experience in designing mold sampling protocols, sampling methods, and interpreting results. Sample analysis should follow analytical methods recommended by the American Industrial Hygiene Association (AIHA), the American Conference of Governmental Industrial Hygienists (ACGIH), or other professional organizations.

Rust is an indicator that condensation occurs on this drainpipe. The pipe should be insulated to prevent condensation.

128

14

suspicion of hidden mold You may suspect hidden mold if a building smells moldy, but you cannot see the source, or if you know there has been water damage and residents are reporting health problems. Mold may be hidden in places such as the back side of dry wall, wallpaper, or paneling, the top side of ceiling tiles, the underside of carpets and pads, etc. Other possible locations of hidden mold include areas inside walls around pipes (with leaking or condensing pipes), the surface of walls behind furniture (where condensation forms), inside duct work, and in roof materials above ceiling tiles (due to roof leaks or insufficient insulation).

investigating hidden mold problems Investigating hidden mold problems may be difficult and will require caution when the investigation involves disturbing potential sites of mold growth. For example, removal of wallpaper can lead to a massive release of spores if there is mold growing on the underside of the paper. If you believe that you may have a hidden mold problem, consider hiring an experienced professional.

hidden Mold

Mold growing on the back side of wallpaper.

129

cleanup and Biocides Biocides are substances that can destroy living organisms. The use of a chemical or biocide that kills organisms such as mold (chlorine bleach, for example) is not recommended as a routine practice during mold cleanup. There may be instances, however, when professional judgment may indicate its use (for example, when immune-compromised individuals are present). In most cases, it is not possible or desirable to sterilize an area; a background level of mold spores will remain - these spores will not grow if the moisture problem has been resolved. If you choose to use dis in fectants or biocides, always ventilate the area and exhaust the air to the outdoors. Never mix chlorine bleach solution with other cleaning solutions or deter gents that contain ammonia because toxic fumes could be produced.

Please note: Dead mold may still cause allergic reactions in some people, so it is not enough to simply kill the mold, it must also be removed.

15

Water stain on a basement wall — locate and fix the source of the water promptly.

130

For more information on mold related issues including mold cleanup and moisture control/condensation/humidity issues, visit:

www.epa.gov/mold

16

additional resources

Mold growing on fallen leaves.

This document is available on the Environmental Protection Agency, Indoor Environments Division website at: www.epa.gov/mold

131

07/24/2012

A Citizen’s Guide To Radon The Guide To Protecting Yourself And Your Family From Radon

EPA 402/K-12/002 | May 2012 | www.epa.gov/radon

Indoor Air Quality (IAQ) 132

2

EPA Recommends:

Test your home for radon—it’s easy and inexpensive.

Fix your home if your radon level is 4 picocuries per liter (pCi/L) or higher.

Radon levels less than 4 pCi/L still pose a risk, and in many cases may be reduced.Radon is

estimated to cause

thousands of lung cancer

deaths in the U.S. each year.

*Radon is estimated to cause about 21,000 lung cancer deaths per year, according to EPA’s 2003 Assessment of Risks from Radon in Homes (EPA 402-R-03-003). The numbers of deaths from other causes are taken from the Centers for Disease Con-trol and Prevention’s 1999-2001 National Center for Injury Prevention and Control Report and 2002 National Safety Council Reports.

30,000

deaths per year

10,000

Drownings

2

Home Fires

Falls in the Home

21,000

U.S. EPA 402-K-09-001, January 2009

17,400

8,000

3,9002,800

RADON* Drunk Driving

2 A Citizen’s Guide To Radon l THE GUIDE TO PROTECTING YOURSELF AND YOUR FAMILY FROM RADON

133

3

Radon is a cancer-causing, radioactive gas.You can’t see radon. And you can’t smell it or taste it. But it may be a problem in your home. Radon is estimated to cause many thousands of deaths each year. That’s because when you breathe air containing radon, you can get lung cancer. In fact, the Surgeon General has warned that radon is the second leading cause of lung cancer in the United States today. Only smoking causes more lung cancer deaths. If you smoke and your home has high radon levels, your risk of lung cancer is especially high.

Radon can be found all over the U.S.Radon comes from the natural (radioactive) breakdown of uranium in soil, rock and water and gets into the air you breathe. Radon can be found all over the U.S. It can get into any type of building—homes, offices, and schools—and result in a high indoor radon level. But you and your family are most likely to get your great-est exposure at home, where you spend most of your time.

You should test for radon.Testing is the only way to know if you and your family are at risk from radon. EPA and the Surgeon General recommend testing all homes below the third floor for radon. EPA also recommends testing in schools. Testing is inexpensive and easy—it should only take a few minutes of your time. Millions of Americans have already tested their homes for radon (see page 5).

You can fix a radon problem.Radon reduction systems work and they are not too costly. Some radon reduction systems can reduce radon levels in your home by up to 99%. Even very high levels can be reduced to acceptable levels.

New homes can be built with radon-resistant features.Radon-resistant construction techniques can be effective in preventing radon entry. When installed properly and completely, these simple and inexpensive techniques can help reduce indoor radon levels in homes. In addition, installing them at the time of construction makes it easier and less expensive to reduce radon levels further if these passive techniques don’t reduce radon levels to below 4 pCi/L. Every new home should be tested after occupancy, even if it was built radon-resistant. If radon levels are still in excess of 4 pCi/L, the passive system should be activated by having a qualified mitigator install a vent fan. For more explanation of radon resistant construction techniques, refer to EPA publication, Building Radon Out: A Step-by-Step Guide on How to Build Radon-Resistant Homes (see page 15).

3U.S. EPA 402-K-09-001, January 2009

OVERVIEW

3A Citizen’s Guide To Radon l THE GUIDE TO PROTECTING YOURSELF AND YOUR FAMILY FROM RADON

134

4

RADON GETS IN THROUGH:

1. Cracks in solid floors.

2. Construction joints.

3. Cracks in walls.

4. Gaps in suspended floors.

5. Gaps around service pipes.

6. Cavities inside walls.

7. The water supply.

HOW DOES RADON GET INTO YOUR HOME?Radon is a radioactive gas. It comes from the natural decay of uranium that is found in nearly all soils. It typically moves up through the ground to the air above and into your home through cracks and other holes in the foundation. Your home traps radon inside, where it can build up. Any home may have a radon problem. This means new and old homes, well-sealed and drafty homes, and homes with or without basements. Radon from soil gas is the main cause of radon problems. Sometimes radon enters the home through well water (see page 8). In a small number of homes, the building materials can give off radon, too. However, building

Any home may have a radon

problem.

materials rarely cause radon problems by themselves. Nearly 1 out of every 15 homes in the U.S. is estimated to have elevated radon levels. Elevated levels of radon gas have been found in homes in your state. Contact your state radon office (www.epa.gov/radon/whereyoulive.html) for general information about radon in your area. While radon problems may be more common in some areas, any home may have a problem. The only way to know about your home is to test. Radon can also be a problem in schools and workplaces. Ask your state radon office (www.epa.gov/radon/whereyoulive.html) about radon problems in schools, daycare and childcare facilities, and workplaces in your area (also visit www.epa.gov/radon).

U.S. EPA 402-K-09-001, January 20094 A Citizen’s Guide To Radon l THE GUIDE TO PROTECTING YOURSELF AND YOUR FAMILY FROM RADON

135

5

HOW TO TEST YOUR HOMEYou can’t see radon, but it’s not hard to find out if you have a radon problem in your home. All you need to do is test for radon. Testing is easy and should only take a few minutes of your time. The amount of radon in the air is measured in “picocuries per liter of air,” or “pCi/L.” There are many kinds of low-cost “do it yourself” radon test kits you can get through the mail and in some hardware stores and other retail outlets. If you prefer, or if you are buying or selling a home, you can hire a qualified tester to do the testing for you. You should first contact your state radon office about obtaining a list of qualified testers. You can also contact a private radon proficiency program for lists of privately certified radon professionals serving your area. For links and more information, visit www.epa.gov/radon/radontest.html.

There are Two General Ways to Test for Radon:SHORT-TERM TESTING:The quickest way to test is with short-term tests. Short-term tests remain in your home for two days to 90 days, depending on the device. “Charcoal canisters,” “alpha track,” “electret ion chamber,” “continuous monitors,” and “charcoal liquid scintillation” detectors are most commonly used for short-term testing. Because radon levels tend to vary from day to day and season to season, a short-term test is less likely than a long-term test to tell you your year-round average radon level. If you need results quickly, however, a short-term test followed by a second short-term test may be used to decide whether to fix your home (see also page 7 under Home Sales).

LONG-TERM TESTING:Long-term tests remain in your home for more than 90 days. “Alpha track” and “electret” detectors are commonly used for this type of testing. A long-term test will give you a reading that is more likely to tell you your home’s year-round average radon level than a short-term test.

How To Use a Test Kit:Follow the instructions that come with your test kit. If you are doing a short-term test, close your windows and outside doors and keep them closed as much as possible during the test. Heating and air conditioning system fans that re-circulate air may be operated. Do not operate fans or other machines which bring in air from outside. Fans that are part of a radon-reduction system or small exhaust fans operating only for short periods of time may run during the test. If you are doing a short-term test lasting just 2 or 3 days, be sure to close your windows and outside doors at least 12 hours before beginning the test, too. You should not conduct

Testing is easy and should only take a few minutes of your time.

U.S. EPA 402-K-09-001, January 2009 5A Citizen’s Guide To Radon l THE GUIDE TO PROTECTING YOURSELF AND YOUR FAMILY FROM RADON

136

6

short-term tests lasting just 2 or 3 days during unusually severe storms or periods of unusually high winds. The test kit should be placed in the lowest lived-in level of the home (for example, the basement if it is frequently used, otherwise the first floor). It should be put in a room that is used regularly (like a living room, playroom, den, or bedroom) but not your kitchen or bathroom. Place the kit at least 20 inches above the floor in a location where it won’t be disturbed—away from drafts, high heat, high humidity, and exterior walls. Leave the kit in place for as long as the package says. Once you’ve finished the test, reseal the package and send it to the lab specified on the package right away for analysis. You should receive your test results within a few weeks.

EPA Recommends the Following Testing Steps:

Step 1. Take a short-term test. If your result is 4 pCi/L or higher, take a follow-up test (Step 2) to be sure.

Step 2. Follow up with either a long-term test or a second short-term test:

•Forabetterunderstandingofyouryear-roundaverage radon level, take a long-term test.

•Ifyouneedresultsquickly,takeasecondshort-termtest.

The higher your initial short-term test result, the more certain you can be that you should take a short-term rather than a long-term follow up test. If your first short-term test result is more than twice EPA’s 4 pCi/L action level, you should take a second short-term test immediately.

Step 3. •Ifyoufollowedupwithalong-termtest:Fixyourhomeifyourlong- term test result is 4 pCi/L or more.

•Ifyoufollowedupwithasecondshort-termtest:Thehigheryour short-term results, the more certain you can be that you should fix your home. Consider fixing your home if the average of your first and second test is 4 pCi/L or higher (see also page 7 under Home Sales).

HOW TO TEST YOUR HOME continued


137

7

WHAT YOUR TEST RESULTS MEANThe average indoor radon level is estimated to be about 1.3 pCi/L, and about 0.4 pCi/L of radon is normally found in the outside air. The U.S. Congress has set a long-term goal that indoor radon levels be no more than outdoor levels. While this goal is not yet technologically achievable in all cases, most homes today can be reduced to 2 pCi/L or below. Sometimes short-term tests are less definitive about whether or not your home is above 4 pCi/L. This can happen when your results are close to 4 pCi/L. For example, if the average of your two short-term test results is 4.1 pCi/L, there is about a 50% chance that your year-round average is somewhat below 4 pCi/L. However, EPA believes that any radon exposure carries some risk—no level of radon is safe. Even radon levels below 4 pCi/L pose some risk, and you can reduce your risk of lung cancer by lowering your radon level. If your living patterns change and you begin occupying a lower level of your home (such as a basement) you should retest your home on that level. Even if your test result is below 4 pCi/L, you may want to test again sometime in the future.

Test your home now and save your results. If you find high radon levels, fix your home before you decide to sell it.

U.S. EPA 402-K-09-001, January 2009

RADON AND HOME SALES

More and more, home buyers and renters are asking about radon levels before they buy or rent a home. Because real estate sales happen quickly, there is often little time to deal with radon and other issues. The best thing to do is to test for radon NOW and save the results in case the buyer is interested in them. Fix a problem if it exists so it won’t complicate your home sale. If you are planning to move, review EPA’s pamphlet “Home Buyer’s and Seller’s Guide to Radon,” which addresses some common questions (www.epa.gov/radon/pubs/realestate.html). You can also use the results of two short-term tests done side-by-side (four inches apart) to decide whether to fix your home.

During home sales:

•Buyersoftenaskifahomehasbeentested,andifelevatedlevelswerereduced.

•Buyersfrequentlywanttestsmadebysomeonewhoisnot involvedinthehomesale.Yourstateradonoffice (www.epa.gov/radon/whereyoulive.html) can assist you in identifying a qualified tester.

•Buyersmightwanttoknowtheradonlevels inareasofthehome(likeabasementtheyplantofinish)thatthe seller might not otherwise test.

Today many homes are built to help prevent radon from coming in. Building codes in your state or local area may require these radon-resistant construction features. If you are buying or renting a new home, ask the owner or builder if it has radon-resistant features. The EPA recommends building new homes with radon-resistant features in high radon potential (Zone 1) areas. Even if built radon-resistant, every new home should be tested for radon after occupancy. If you have a test result of 4 pCi/L or more, you can have a qualified mitigator easily add a vent fan to an existing passive system for about $300 and further reduce the radon level in your home. For more information, refer to the EPA’s Map of Radon Zones and other useful EPA documents on radon-resistant new construction (see publications on page 15), or visit www.epa.gov/radon.


138

8

RADON IN WATERThere are two main sources for the radon in your home’s indoor air, the soil and the water supply. Compared to radon entering the home through water, radon entering your home through the soil is usually a much larger risk. The radon in your water supply poses an inhalation risk and an ingestion risk. Research has shown that your risk of lung cancer from breathing radon in air is much larger than your risk of stomach cancer from swallowing water with radon in it. Most of your risk from radon in water comes from radon

If you’ve testedthe air in your

home and founda radon problem,

and your watercomes from a

well, have yourwater tested.

released into the air when water is used for showering and other household purposes. Radon in your home’s water is not usually a problem when its source is surface water. A radon in water problem is more likely when its source is ground water, e.g., a private well or a public water supply system that uses ground water. If you are concerned that radon may be entering your home through the water and your water comes from a public water supply, contact your water supplier. If you’ve tested your private well and have a radon in water problem, it can be fixed. Your home’s water supply can be treated in two ways. Point-of-entry treatment can effectively remove radon from the water before it enters your home. Point-of-use treatment devices remove radon from your water at the tap, but only treat a small portion of the water you use and are not effective in reducing the risk from breathing radon released into the air from all water used in the home. For more information, call EPA’s Drinking Water Hotline at (800) 426-4791 or visit www.epa.gov/safewater/radon.html. If your water comes from a private well, you can also contact your state radon office.


139

9

RADON AND HOME RENOVATIONS

If you are planning any major structural renovation, such as converting an unfin-ished basement area into living space, it is especially important to test the area for radon before you begin the renovation. If your test results indicate a radon problem, radon-resistant techniques can be inexpensively included as part of the renovation. Because major renovations can change the level of radon in any home, always test again after work is completed.

HOW TO LOWER THE RADON LEVEL IN YOUR HOME

Since there is no known safe level of radon, there can always be some risk. But the risk can be reduced by lowering the radon level in your home. There are several proven methods to reduce radon in your home, but the one primarily used is a vent pipe system and fan, which pulls radon from beneath the house and vents it to the outside. This system, known as a soil suction radon reduction system, does not require major changes to your home. Sealing foundation cracks and other openings makes this kind of system more effective and cost-efficient. Similar systems can also be installed in houses with crawl spaces. Radon contractors can use other methods that may also work in your home. The right system depends on the design of your home and other factors. Ways to reduce radon in your home are discussed in EPA’s Consumer’s Guide to Radon Reduction. You can get a copy at www.epa.gov/radon/pubs. The cost of reducing radon in your home depends on how your home was built and the extent of the radon problem. Most homes can be fixed for about the same cost as other common home repairs. The cost to fix can vary widely; consult with your state radon office or get one or more estimates from qualified mitigators. The cost is much less if a passive system was installed during construction.


140

10

Lowering high radon levels requires technical knowledge and special skills. You should use a contractor who is trained to fix radon problems. A qualified contractor can study the radon problem in your home and help you pick the right treatment method. Check with your state radon office for names of qualified or state certified radon contractors in your area. You can also contact private radon proficiency programs for lists of privately certified radon professionals in your area. For more information on private radon proficiency programs, visit www.epa.gov/radon/radontest.html. Picking someone to fix your radon problem is much like choosing a contractor for other home repairs—you may want to get references and more than one estimate. If you are considering fixing your home’s radon problem yourself, you should first contact your state radon office for guidance and assistance (www.epa.gov/radon/whereyoulive.html). You should also test your home again after it is fixed to be sure that radon levels have been reduced. Most soil suction radon reduction systems include a monitor that will indicate whether the system is operating properly. In addition, it’s a good idea to retest your home every two years to be sure radon levels remain low.

Most homes canbe fixed for

about the samecost as other

common homerepairs.

Note: This diagram is a composite view of several mitigation options. The typical mitigation system usually has only one pipe penetration through the basement floor; the pipe may also be installed on the outside of the house.

U.S. EPA 402-K-09-001, January 2009

HOW TO LOWER THE RADON LEVEL IN YOUR HOME continued


141

11

THE RISK OF LIVING WITH RADONRadon gas decays into radioactive particles that can get trapped in your lungs when you breathe. As they break down further, these particles release small bursts of energy. This can damage lung tissue and lead to lung cancer over the course of your lifetime. Not everyone exposed to elevated levels of radon will develop lung cancer. And the amount of time between exposure and the onset of the disease may be many years. Like other environmental pollutants, there is some uncertainty about the magnitude of radon health risks. However, we know more about radon risks than risks from most other cancer-causing substances. This is because estimates of radon risks are based on studies of cancer in humans (underground miners). Smoking combined with radon is an especially serious health risk. Stop smoking and lower your radon level to reduce your lung cancer risk. Children have been reported to have greater risk than adults of certain types of cancer from radiation, but there are currently no conclusive data on whether children are at greater risk than adults from radon.

Your chances of getting lung cancer from radon depend mostly on:

• Howmuchradonisinyourhome

• Theamountoftimeyouspendin your home

• Whetheryouareasmokerorhave ever smoked

Scientists are more certain about radon risks than risks from most other cancer-causing substances.


142

12

RADON RISK IF YOU SMOKE

RADON RISK IF YOU’VE NEVER SMOKED

Radon Level

20 pCi/L

10 pCi/L

8 pCi/L

4 pCi/L

2 pCi/L

1.3 pCi/L

0.4 pCi/L

If 1,000 people who smoked were exposed

to this level over a lifetime*. . .

About 260 people could get lung cancer






The risk of cancer from radon exposure compares to**. . .

250 times the risk of drowning

200 times the risk of dying in a home fire

30 times the risk of dying in a fall

5 times the risk of dying in a car crash

6 times the risk of dying from poison

(Average indoor radon level)

(Average outdoor radon level)

WHAT TO DO: Stop Smoking and. . .

Fix your home

Fix your home

Fix your home

Fix your home

Consider fixing between 2 and 4 pCi/L

(Reducing radon levels

below 2 pCi/L is difficult)

Note: If you are a former smoker, your risk may be lower.

It’s never too late to reduce

your risk of lung cancer. Don’t

wait to test and fix a radon

problem. If you are a smoker, stop smoking.

Radon Level

20 pCi/L

10 pCi/L

8 pCi/L

4 pCi/L

2 pCi/L

1.3 pCi/L

0.4 pCi/L

If 1,000 people who never smoked were ex-

posed to this level over a lifetime*. . .







The risk of cancer from radon exposure compares to**. . .

35 times the risk of drowning

20 times the risk of dying in a home fire

4 times the risk of dying in a fall

The risk of dying in a car crash

The risk of dying from poison

(Average indoor radon level)

(Average outdoor radon level)

WHAT TO DO:

Fix your home

Fix your home

Fix your home

Fix your home

Consider fixing between 2 and 4 pCi/L

(Reducing radon levels

below 2 pCi/L is difficult)

Note: If you are a former smoker, your risk may be higher. *Lifetime risk of lung cancer deaths from EPA Assessment of Risks from Radon in Homes (EPA 402-R-03-003).**Comparison data calculated using the Centers for Disease Control and Prevention’s 1999-2001 National Center for Injury Prevention and Control Reports.

U.S. EPA 402-K-09-001, January 2009

THE RISK OF LIVING WITH RADON continued


143

13

MYTH: Scientists aren’t sure radon

really is a problem.

FACT: Although some scientists dispute the precise number of deaths due to radon, all major health organizations (like the Centers for Disease Control, the American Lung Association and the American Medical Association) agree with estimates that radon causes thousands of preventable lung cancer deaths every year. This is especially true among smokers, since the risk to smokers is much greater than to non- smokers.

MYTH: Radon testing is difficult, time

consuming and expensive.

FACT: Radon testing is easy. You can test your home yourself or hireaqualifiedradontestcompany.Eitherapproachtakes only a small amount of time and effort.

MYTH: Homes with radon problems

can’t be fixed.

FACT: There are simple solutions to radon problems in homes. Hundreds of thousands of homeowners have already fixed radon problems in their homes. Most homes can be fixed for about the same cost as other common home repairs; checkwithoneormorequalifiedmitigators.Callyour state radon office (www.epa.gov/radon/whereyoulive. html)forhelpinidentifyingqualifiedmitigationcontractors.

MYTH: Radon only affects certain kinds of homes.

FACT: House construction can affect radon levels. However, radon can be a problem in homes of all types: old homes, new homes, drafty homes, insulated homes, homes with basements, homes without basements. Local geology, construction materials, and how the home was built are among the factors that can affect radon levels in homes.

U.S. EPA 402-K-09-001, January 2009

RADON MYTHS AND FACTS


MYTH: Radon is only a problem in certain

parts of the country.

FACT: High radon levels have been found in every state. Radon problems do vary from area to area, but the only way to know your radon level is to test.

MYTH: A neighbor’s test result is a good

indication of whether your home has a problem.

FACT: It’s not. Radon levels can vary greatly from home to home. The only way to know if your home has a radon problem is to test it.

144

14

MYTH: Everyone should test their water for radon.

FACT: Although radon gets into some homes through water, it is important to first test the air in the home for radon. If your water comes from a public water system that uses ground water, call your water supplier. If high radon levels are found and the home has a private well, call the Safe Drinking Water Hotline at (800) 426-4791 for information on testing your water.

MYTH: It’s difficult to sell homes where radon

problems have been discovered.

FACT: Where radon problems have been fixed, home sales have not been blocked or frustrated. The added protection is sometimes a good selling point.

MYTH: I’ve lived in my home for so long, it

doesn’t make sense to take action now.

FACT: You will reduce your risk of lung cancer when you reduce radon levels, even if you’ve lived with a radon problem for a long time.

MYTH: Short-term tests can’t be used for

making a decision about whether to fix

your home.

FACT: A short-term test followed by a second short-term test* can be used to decide whether to fix your home. However, the closer the average of your two short-term tests is to 4 pCi/L, the less certain you can be about whether your year-round average is above or below that level. Keep in mind that ra-don levels below 4 pCi/L still pose some risk. Radon levels can be reduced in most homes to 2 pCi/L or below.*If the radon test is part of a real estate transaction, the result of two short-term tests can be used in deciding whether to mitigate. For more information, see EPA’s “Home Buyer’s and Seller’s Guide to Radon.”

U.S. EPA 402-K-09-001, January 2009

RADON MYTHS AND FACTS continued


145

15

FOR FURTHER INFORMATION

www.epa.gov/radon/whereyoulive.htmlCheck the above website for a listing of your EPA regional office.

EPA Regional Offices

1-800-SOS-RADON (767-7236)*Purchase radon test kits by phone.

1-800-55RADON (557-2366)*Get live help for your radon questions.

1-800-644-6999*Radon Fix-It Hotline. For general information on fixing or reducing the radon level in your home.

1-866-528-3187*Línea Directa de Información sobre Radón en Español. Hay operadores disponibles desde las 9:00 AM hasta las 5:00 PM para darle información sobre radón y como ordenar un kit para hacer la prueba de radón en su hogar.

1-800-426-4791Safe Drinking Water Hotline. For general information on drinking water, radon in water, testing and treatment, and standards for radon in drinking water. Operated under a contract with EPA.

*Operated by Kansas State University

in partnership with EPA.

Radon Hotlines

EPA Radon Websitewww.epa.gov/radonEPA’s radon page includes links to publications, hotlines, private proficiency programs and more.

Frequent Questions:http://iaq.supportportal.com Ordering Radon

PublicationsMany EPA radon publications are available from www.epa.gov/radon/pubs

Radon publications may be ordered through the National Service Center for Environmental Publications (NSCEP) by calling 1-800-490-9198, by visiting the NSCEP website at www.epa.gov/ncepihom, or by email at [email protected]


146

16

U.S. EPA Assessment of Risks from Radon in Homes

In June 2003, the EPA revised its risk estimates for radon exposure in homes. EPA estimates that about 21,000 annual lung cancer deaths are radon related. EPA also concluded that the effects of radon and cigarette smoking are synergistic, so that smokers are at higher risk from radon. EPA’s revised estimates are based on the National Academy of Sciences 1998 BEIR VI (Biological Effects of Ionizing Radiation) Report which concluded that radon is the second leading cause of lung cancer after smoking.

Surgeon General Health Advisory“Indoor radon is the second-leading cause of lung cancer in the United States and breathing it over prolonged periods

can present a significant health risk to families all over the country. It’s important to know that this threat is completely preventable. Radon can be detected with a simple test and fixed through well-established venting techniques.”

January 2005

Indoor Air Quality (IAQ)

Indoor Environments Division (6609J)EP 402/K-12/002 | May 2012 | www.epa.gov/radon

147

07/24/2012

The Massachusetts Association of REALTORS / Legal Resources

Title 5 (Septic System Regulations)

TITLE 5

Overview: Homes that are not connected to a sewer system use septic systems or cesspools, both of

which are regulated by the state Department of Environmental Protection (DEP) and local boards of

health. A septic system has a tank, a distribution box, and soil absorption system commonly known as a

"leach field." A cesspool has a pipe carrying waste from the home to a pit which distributes liquid waste.

Improperly functioning sewage systems and cesspools are a major cause of the pollution of our coastal

waters, rivers, and water supplies. As of March 31, 1995, the state environmental code governing septic

systems, commonly referred to as Title 5 regulations, requires inspections of septic systems and

cesspools prior to a home being sold or enlarged. In most instances, systems that fail inspection must be

repaired within 2 years. After January 1, 1996, most septic system replacements or upgrades will also

require that the soil evaluation test be performed by a DEP-approved soil evaluator. On November 3,

1995, Title 5 was again revised to encourage increased compliance with the regulations and to minimize

financial hardships and delays for homeowners.

Relevant Law: Massachusetts Septic System Inspection Regulation, 310 CMR 15.00.

Important Issues: Because compliance with Title 5 is complex and potentially lengthy and costly, it is

imperative that Realtors familiarize themselves with the general requirements of Title 5. Quick and

thorough discussion of Title 5 to a seller and buyer can help to prevent delays in a pending sale. This is

especially true since many mortgage lenders may require any septic system or cesspool repair or

upgrade to be completed before closing or that funds for the cost of the repair be placed in escrow

before closing. Although Title 5 is a state regulation, it is a minimum code therefore permitting local

boards of health to adopt ordinances that are more stringent than Title 5. As with any regulation or law,

there are many nuances and details that must be carefully followed to ensure compliance. Careful

instruction will help prevent any unnecessary delays or expenses. Informational brochures on Title 5 are

available for purchase from the Massachusetts Association of Realtors.

Frequently Asked Questions: (Note: All answers are subject to additional local requirements, if any.)

Q: When are septic system and cesspool inspections required under Title 5?

A: Septic system and cesspool inspections are required in the following circumstances:

Within 2 years before the sale of a home or transfer of title;

In certain inheritance situations; (e.g. - when a child inherits a house from his/her parents);

148

In certain insolvency proceedings (e.g. - bankruptcy, tax taking or foreclosure);

When the use of the home is changed (e.g. - from residential to commercial use);

When the footprint of the house is enlarged;

When the home is expanded and a building, or occupancy permit is required (e.g. - adding a bedroom)

Q: When are septic system and cesspool inspections NOT required under Title 5?

A: Septic system and cesspool inspections are not required in the following circumstances:

When a mortgage is refinanced;

When the system was inspected within 3 years before the sale and you have records proving that your

system was pumped annually since the inspection;

Title to the house is transferred from one spouse to another or placed in certain family trusts;

When the local board of health issued a certificate of compliance within 2 years before the time of

transfer of title;

When the community has adopted a comprehensive plan approved by DEP requiring periodic

inspections and the system was inspected at the most recent time required by the plan; or

When the homeowner has entered into an enforceable agreement, binding on subsequent buyers, with

the board of health requiring an upgrade of the system or connection to the municipal sewer system

within 2 years of transfer or sale.

Q: How much does the average inspection and replacement or upgrade, if required, cost?

A: The average cost of a septic system or cesspool inspection ranges between $300 to $500. The cost of

repairs or upgrades vary depending on the nature of the problem; the location of the system, the size of

the system, soil conditions; and site restrictions. A simple repair may only cost $500 while more

extensive repairs may cost up to $12,000 or more. Contact your local board of health to inquire about

typical costs in your community.

Q: If a septic system or cesspool inspection is required at what point in time must the inspection be

performed?

A: The inspection must be performed within 2 years prior to the sale or transfer of the home or 6

months after the sale if weather conditions preclude prior inspection. If the system fails inspection, the

system must be upgraded or replaced within 2 years of the inspection regardless whether the house is

actually sold or transferred. However, voluntary inspections, inspections not performed because of an

intent to sell the property, may be performed just to assess the system’s condition. The results of a

voluntary inspection are not reported to the local board of health or DEP.

149

Q: Who is allowed to perform septic system or cesspool inspections?

A: Only inspectors and soil evaluators approved under the regulations can perform required system

inspections and soil tests. A list of DEP-approved soil evaluators and inspectors is available from your

local board of health. Certified health officers, registered sanitarians and professional engineers qualify

automatically as system inspectors under the regulations, and their names may or may not appear on

the DEP-approved list. Consult with your local board of health to ensure that the system is inspected by

a qualified individual.

Q: What happens with the results of a septic system or cesspool inspection?

A: If a system passes, the inspector is required to submit an approved system inspection form to the

local board of health within 30 days, and the homeowner must provide a copy to the buyer. Prospective

buyers and lending institutions may also require a copy of the approved inspection form.

If the systems fails a required inspection, the inspector is required to submit the form to the local board

of health within 30 days, and the homeowner must provide a copy to the buyer. The system must be

repaired or upgraded within 2 years following the inspection, regardless whether the property is sold.

Q: Is there any state financial assistance available to homeowners faced with the financial burden of

replacing or upgrading their septic system?

A: With the support of the Massachusetts Association of Realtors, the Massachusetts legislature passed

a Title 5 tax credit which will provide eligible homeowners with a tax credit equal to 40 percent of the

design and construction costs incurred to upgrade or repair a septic system. The tax credit relief

measure provides credits of up to $1,500 per year for qualified homeowners with a maximum credit of

$6,000 over a four-year period. This tax credit is available for all septic system and cesspool upgrade and

repairs which occurred on or after January 1, 1997.

Additional financial assistance is available in the form of low interest loans through the Massachusetts

Housing Finance Agency and the Rural Economic Development Service Loan program. In addition,

eligible municipalities can make low-interest 20-year loans to low-to-moderate income homeowners,

repaid by adding an annual "betterment" to their tax bill. Contact your local board of health to see if

your community participates in the Betterment Fund Program.

Last Update 12/97

For more information please contact the following:

Massachusetts Association of REALTORS ® at (800) 370-LEGAL

Massachusetts Department of Environmental Protection, Title 5 Hotline

at (617) 292-5886 or (800) 266-1122.

150

Office of the Attorney General, Consumer Complaint and Information Line at (617) 727-8400

Massachusetts Better Business Bureau at (413) 734-3114 or (508) 755-2548 or (617) 426-9000

Massachusetts Housing Finance Agency (HILP Loans) at (617) 854-1020

Rural Economic Development Service Loans at (413) 253-4330

This publication is provided as a service to members of the Massachusetts Association of REALTORS ®

and is intended for educational use only. Opinion or suggestions in this publication do not necessarily

represent the official policies or positions of the Massachusetts Association of REALTORS ® . The

Massachusetts Association of REALTORS ® does not accept responsibility for any misinterpretation or

misapplication by the reader of the information contained in this article. The publishing of this

material does not constitute the practice of law nor does it attempt to provide legal advice concerning

any specific factual situation. FOR ADVICE ON SPECIFIC LEGAL PROBLEMS CONSULT LEGAL COUNSEL.

151

07/24/2012 http://www.marealtor.com/content/title_5.htm

A Guide to the Massachusetts…

Smoke & Carbon Monoxide Requirements

…when Selling a One- or Two-Family Residence

FIRE SERVICESDepartment of Fire ServicesPO BOx 1025 • StOw, MA 01775 • 978-567-3300

www.mass.gov/dfs

152

M.G.L. c 148 s. 26F - The Law

Massachusetts General Law, chapter 148 section 26F mandates that upon the sale or transfer of certain homes, the seller must install approved smoke detectors. These requirements apply to residences that were built or modified prior to creation of the Massachusetts State Building Code (January 1, 1975). If a building has undergone renovation, addition or modification after Jan. 1, 1975, the date of the building permit determines the smoke detector requirements of the building code.

Although the transfer law applies to residences with five or less residential units, this pamphlet will focus only on one- and two-family homes.

VeriFicaTion

After a successful inspection for smoke detector compliance, the local fire department will issue a Certificate of Compliance indicating that the residence meets the smoke detector requirements.

Although the law applies to homes built prior to the date of the building code (Jan. 1975), it is industry practice that most purchase and sales agreements, and many mortgage companies require that the seller, as a condition to sell or transfer, obtain a Certificate of Compliance issued by the local fire department, even if the home was permitted or modified after 1975.

sMoke DeTecTor requireMenTs

In general, the requirements for smoke detectors vary depending on when the residence was constructed. For example, some residences may require battery-powered detectors, others might need interconnected hard-wired detectors only or a combination of both. Others might need

153

interconnected hard-wired detectors with battery backup. On April 5, 2010, a significant change in the Massachusetts’ smoke detector requirements will become effective for all residences subject to MGL c. 148, s. 26F upon sale or transfer. Now, all smoke detectors installed within 20 feet of kitchens or bathrooms (containing a bathtub or shower) will be required to be photoelectric detectors. The risk of nuisance alarms from steam and cooking is lower with photoelectric only detectors. All installed smoke detectors outside of 20 feet of kitchens or bathrooms (containing a bathtub or shower) must utilize either:

A DUAL detector (containing both ionization •and photoelectric technologies); OR

Two separate detectors (one photoelectric •and one ionization).

In residences not subject to MGL c. 148, s. 26F (built after Jan. 1975), the smoke detector upgrade is recommended, but is not required by law.

PhoToeLecTric Vs. ionizaTion TechnoLoGies

Ionization smoke detectors:Use radiation to detect smoke.• More effective in detecting flaming fires.• Increased risk of nuisance alarms caused by steam or • cooking smoke.

Photoelectric smoke detectors:Use light to detect smoke.• More effective in detecting smoldering fires, which • have been attributed to more fires involving death.Low voltage or wireless low voltage systems only use • photoelectric detectors.

154

carbon MonoxiDe aLarMs

Massachusetts General Law, chapter 148 section 26F½ and 527 CMR 31 mandates that upon the sale or transfer of any residence, the local fire department must inspect the residence for carbon monoxide alarm compliance. After a successful inspection, the local fire department will issue a Certificate of Compliance indicating that the residence meets the carbon monoxide alarm requirements.

carbon MonoxiDe aLarM requireMenTs

Since March 31, 2006, carbon monoxide alarms have been required in all residences that have either: fossil fuel burning equipment or an attached enclosed garage. This law applied to all such residences whether or not the residence is being sold or transferred.

whaT is FossiL FueL burninG equiPMenT?

Fossil fuel burning equipment is any device, apparatus or appliance that is designed or used to consume fuel of any kind which emits carbon monoxide as a by-product of combustion. Some examples of a fossil fuel burning equipment include: water heaters, oil or gas furnaces, wood or gas fireplaces, wood pellet stoves, gas clothes dryers, or gas cooking stoves.

how wiLL i know whaT i neeD?

The word “typical” is used in the following guidelines only for purposes of illustration. The actual requirements may depend on when the building permit for the residence was actually applied for and if there have been any major renovations, additions or modifications. It is best to check with your local fire department for detailed guidance.

155

Typical one- and two-family residences built before January 1, 1975:

Smoke detectors are required as follows:•On every habitable level of the residence. ▪On the ceiling at the base of each stairway. ▪On the ceiling outside of each separate sleeping ▪area.The smoke detectors may either be battery ▪powered, hardwired or a combination of the two.If the smoke detector is located within 20 feet of ▪a kitchen or bathroom (containing a bathtub or shower), the smoke detector will be required to be a photoelectric detector. If the smoke detector is outside of 20 feet of a ▪kitchen or a bathroom (containing a bathtub or shower) you must utilize either:A dual detector (containing both ionization and ▪photoelectric technologies); ORTwo separate detectors (one photoelectric and ▪one ionization).

Low voltage household warning systems are •exempt from the dual detection requirement.

Carbon monoxide alarms are required •as follows:

On every level of the residence, including ▪habitable portions of basements and attics and must be located within 10 feet of each bedroom door.Combination detectors (photoelectric smoke ▪and carbon monoxide detector) may be used if the detector is within 20 feet of a kitchen or bathroom (containing a bathtub or shower).Combination detectors (ionization smoke and ▪carbon monoxide detector) may be used if the detector is outside of 20 feet of a kitchen or

156

bathroom (containing a bathtub or shower).May be either: battery powered, plug-in with ▪battery backup, hardwired with battery backup, or system type.Follow the manufacturer’s instructions for ▪placement.

Typical one- and two-family residences permitted between 1975 and August 27, 1997:

Smoke detectors are required as follows:•One smoke detector on every habitable level of ▪the residence.One smoke detector on the ceiling at the base of ▪each stairway.One smoke detector on the ceiling outside of ▪each separate sleeping area.A minimum of one smoke detector must be ▪installed for every 1,200 square feet of living space per level.Must be hardwired interconnected smoke ▪detectors.

Carbon monoxide alarms are required as •follows:

On every level of the residence, including ▪habitable portions of basements and attics and must be located within 10 feet of each bedroom door.Combination detectors (photoelectric smoke ▪and carbon monoxide detector) may be used anywhere.Combination detectors (ionization smoke and ▪carbon monoxide detector) may be used if the detector is outside of 20 feet of a kitchen or bathroom (containing a bathtub or shower).May be either: battery powered, plug-in with ▪battery backup, hardwired with battery backup, or system type.

157

Follow the manufacturer’s instructions for ▪placement.

Typical one- and two-family residences permitted after August 27, 1997:

Smoke detectors are required as follows:•One smoke detector on every habitable level of ▪the residence.One smoke detector at the base of each stairway. ▪One smoke detector outside of each separate ▪sleeping area.One smoke detector inside every bedroom. ▪A minimum of one smoke detector must be ▪installed for every 1,200 square feet of living space per level.Must be hardwired and interconnected smoke ▪detectors with battery backup.If the smoke detector is within 20 feet of a ▪kitchen or bathroom (containing a bathtub or shower), the smoke detector is required to be a photoelectric detector.


On every level of the residence, including ▪habitable portions of basements and attics and must be located within 10 feet of each bedroom door.Combination detectors (photoelectric smoke ▪and carbon monoxide detector) may be used anywhere.Combination detectors (ionization smoke and ▪carbon monoxide detector) may be used if the detector is outside of 20 feet of a kitchen or bathroom (containing a bathtub or shower).May be either: battery powered, plug-in with ▪battery backup, hardwired with battery backup, or system type.

158

Follow the manufacturer’s instructions for ▪placement.

Typical one- and two-family residences permitted on or after January 1, 2008:

Smoke detectors are required as follows:•One smoke detector on every habitable level of ▪the residence.One smoke detector at the base of each stairway. ▪One smoke detector outside of each separate ▪sleeping area.One smoke detector inside every bedroom. ▪A minimum of one smoke detector must be ▪installed for every 1,200 square feet of living space per level.Must be hardwired and interconnected smoke ▪detectors with battery backup.If the smoke detector is within 20 feet of a ▪kitchen or bathroom (containing a bathtub or shower), the smoke detector is required to be a photoelectric detector. If the smoke detector is outside of 20 feet of ▪a kitchen or a bathroom (containing a bathtub or shower), the smoke detector is required to be either a photoelectric detector or a dual detector (containing both ionization and photoelectric technologies).

Carbon monoxide alarms are required •as follows:

On every level of the residence, including ▪basements and habitable portions of attics and must be located within 10 feet of each bedroom door.Combination detectors (photoelectric smoke and ▪carbon monoxide detector) may be used.Must be hardwired and interconnected with ▪battery backup. (May be separately wired from

159

the existing smoke detection system.)Follow the manufacturer’s instructions for ▪placement.

Heat detectors are required as follows:•Must have a single heat detector in any garage ▪attached to or under the residence. Must be hardwired and interconnected with or ▪without battery backup to the existing smoke detection system.Heat detectors are not required in older homes ▪unless renovation, addition or modification occurs after Jan. 1, 2008.

Typical one- and two-family residences permitted on or after February 4, 2011:

Smoke detectors are required as follows:•One smoke detector in the basement and on each ▪habitable story of the residence.One smoke detector at the base of all stairs to ▪another occupied floor .One smoke detector outside of each separate ▪sleeping area.One smoke detector inside every sleeping area. ▪A minimum of one smoke detector must be ▪installed for every 1,200 square feet of area or part thereof. Must be hardwired and interconnected smoke ▪detector with battery backup.All smoke detector must be photoelectric. ▪

Heat detectors are required as follows:•A single heat detector must be installed in an ▪integral or attached garage.


On every level of the residence, including ▪

160

basements and habitable portions of attics and must be located within 10 feet of each bedroom door No further than 10 feet from any bedroom door. ▪Combination alarms (photoelectric smoke and ▪carbon monoxide alarm) may be used.Must be hardwired and interconnected with ▪battery backup. (May be separately wired from the existing smoke detection system.)

how wiLL i GeT a cerTiFicaTe oF coMPLiance?

After you have a closing date:Contact the local fire department to schedule an • inspection of your smoke and carbon monoxide detectors right away. Don’t wait until the last minute!Fees are determined by each city/town.•

Priortothearrivalof thefiredepartment:

Make sure that your posted street number is •visible from the street (MGL c.148 § 59);

Make sure that you have the proper type of •detectors.

The local fire department may require that they be ▪taken down for compliance verification.Make sure that all detectors are installed in the ▪proper locations.Make sure that all detectors are working properly. ▪

Afterpassingtheinspection,thelocalfire•departmentwillissueyourCertificateof Compliance.

This document will probably be required at the ▪closing and is only valid for 60 days.

161

how Do i know which kinD oF sMoke DeTecTor i haVe?

A new detector should be marked on the outside of the package to indicate if it uses ionization or photoelectric technology.

For older or existing detectors you will need to remove the smoke detector and look on the backside.

The date of manufacture should be on •the back; if not, the detector is most likely outdated and should be replaced to comply with the regulation.

It is an ionization smoke detector if the word •“AMERICIUM” or the following symbol is on the back:

can i sTiLL haVe ionizaTion sMoke DeTecTors iF i aM noT seLLinG or TransFerrinG My hoMe?

Yes. The requirements in the new regulation only • apply upon the sale or transfer of the residence. Even though the technology has changed, ionization • detectors are still reliable.However, the risk of nuisance alarms from steam • and cooking is higher with ionization detectors, particularly if located within 20 ft of a kitchen or bathroom.

162

August 2012

are coMbinaTion carbon MonoxiDe & sMoke DeTecTors PerMiTTeD?

Yes. Combination carbon monoxide and smoke • detectors are permitted.They must have both a tone and simulated voice • alarm to distinguish the type of emergency. Carbon monoxide detectors are required regardless of a sale or transfer.Combination ionization and CO detectors cannot be • used within 20 ft of a kitchen or bathroom

are There oTher recoMMenDaTions?

TheStateFireMarshal’sOfficerecommends:

Test your smoke and CO detectors monthly •and replace the batteries twice a year. REMEMBER, when you change the clocks, change the batteries.

Unless otherwise recommended by the ▪manufacturer’s published instructions, no smoke detectors (battery operated or hard-wired smoke detectors only!) shall remain in service after 10 years from the date of manufacture.

163

70+ Ways to Lose Your Property

You don't want problems from prior ownerships to interfere with your rights to your property. And you

don't want to pay the potentially ruinous cost of defending your property rights in court.

A title insurance policy is your best protection against potential title defects, which can remain hidden

despite the most thorough search of public records and the most careful escrow or closing.

For a one-time premium First American agrees to reimburse you for loss due to defects existing prior to

the issue date of your policy, up to the policy amount. And, should it be needed, the policy also provides

for the cost of legal defense of your title.The standard coverage policy protects you against such

potential defects as:

1. Forged deeds, mortgages, satisfactions or releases.

2. Deed by person who is insane or mentally incompetent.

3. Deed by minor (may be disavowed).

4. Deed from corporation, unauthorized under corporate bylaws or given under falsified corporate

resolution.

5. Deed from partnership, unauthorized under partnership agreement.

6. Deed from purported trustee, unauthorized under trust agreement.

7. Deed to or from a "corporation" before incorporation, or after loss of corporate charter.

8. Deed from a legal non-entity (styled, for example, as a church, charity or club).

9. Deed by person in a foreign country, vulnerable to challenge as incompetent, unauthorized or

defective under foreign laws.

10. Claims resulting from use of "alias" or fictitious namestyle by a predecessor in title.

11. Deed challenged as being given under fraud, undue influence or duress.

12. Deed following non-judicial foreclosure, where required procedure was not followed.

13. Deed affecting land in judicial proceedings (bankruptcy, receivership, probate, conservatorship,

dissolution of marriage), unauthorized by court.

14. Deed following judicial proceedings, subject to appeal or further court order.

15. Deed following judicial proceedings, where all necessary parties were not joined.

16. Lack of jurisdiction over persons or property in judicial proceedings.

164

17. Deed signed by mistake (grantor did not know what was signed).

18. Deed executed under falsified power of attorney.

19. Deed executed under expired power or attorney (death, disability or insanity of principal).

20. Deed apparently valid, but actually delivered after death of grantor or grantee, or without

consent of grantor.

21. Deed affecting property purported to be separate property of grantor, which is in fact

community or jointly-owned property.

22. Undisclosed divorce of one who conveys as sole heir of a deceased former spouse.

23. Deed affecting property of deceased person, not joining all heirs.

24. Deed following administration of estate of missing person, who later re-appears.

25. Conveyance by heir or survivor of a joint estate, who murdered the decedent.

26. Conveyances and proceedings affecting rights of service-member protected by the Soldiers and

Sailors Civil Relief Act.

27. Conveyance void as in violation of public policy (payment of gambling debt, payment for

contract to commit crime, or conveyance made in restraint of trade).

28. Deed to land including "wetlands" subject to public trust (vesting title in government to protect

public interest in navigation, commerce, fishing and recreation).

29. Deed from government entity, vulnerable to challenge as unauthorized or unlawful.

30. Ineffective release of prior satisfied mortgage due to acquisition of note by bona fide purchaser

(without notice of satisfaction).

31. Ineffective release of prior satisfied mortgage due to bankruptcy of creditor prior to recording of

release (avoiding powers in bankruptcy).

32. Ineffective release of prior mortgage of lien, as fraudulently obtained by predecessor in title.

33. Disputed release of prior mortgage or lien, as given under mistake or misunderstanding.

34. Ineffective subordination agreement, causing junior interest to be reinstated to priority.

35. Deed recorded, but not properly indexed so as to be locatable in the land records.

36. Undisclosed but recorded federal or state tax lien.

37. Undisclosed but recorded judgment or spousal/child support lien.

165

38. Undisclosed but recorded prior mortgage.

39. Undisclosed but recorded notice of pending lawsuit affecting land.

40. Undisclosed but recorded environmental lien.

41. Undisclosed but recorded option, or right of first refusal, to purchase property.

42. Undisclosed but recorded covenants or restrictions, with (or without) rights of reverter.

43. Undisclosed but recorded easements (for access, utilities, drainage, airspace, views) benefiting

neighboring land.

44. Undisclosed but recorded boundary, party wall or setback agreements.

45. Errors in tax records (mailing tax bill to wrong party resulting in tax sale, or crediting payment to

wrong property).

46. Erroneous release of tax or assessment liens, which are later reinstated to the tax rolls.

47. Erroneous reports furnished by tax officials (not binding local government).

48. Special assessments which become liens upon passage of a law or ordinance, but before

recorded notice or commencement of improvements for which assessment is made.

49. Adverse claim of vendor's lien.

50. Adverse claim of equitable lien.

51. Ambiguous covenants or restrictions in ancient documents.

52. Misinterpretation of wills, deeds and other instruments.

53. Discovery of will of supposed intestate individual, after probate.

54. Discovery of later will after probate of first will.

55. Erroneous or inadequate legal descriptions.

56. Deed to land without a right of access to a public street or road.

57. Deed to land with legal access subject to undisclosed but recorded conditions or restrictions.

58. Right of access wiped out by foreclosure on neighboring land.

59. Patent defects in recorded instruments (for example, failure to attach notarial acknowledgment

or a legal description).

166

60. Defective acknowledgment due to lack of authority of notary (acknowledgment taken before

commission or after expiration of commission).

61. Forged notarization or witness acknowledgment.

62. Deed not properly recorded (wrong county, missing pages or other contents, or without

required payment).

63. Deed from grantor who is claimed to have acquired title through fraud upon creditors of a prior

owner.

An extended coverage policy may be requested to protect against such additional defects as:

64. Deed to a purchaser from one who has previously sold or leased the same land to a third party

under an unrecorded contract, where the third party is in possession of the premises.

65. Claimed prescriptive rights, not of record and not disclosed by survey.

66. Physical location of easement (underground pipe or sewer line) which does not conform with

easement of record.

67. Deed to land with improvements encroaching upon land of another.

68. Incorrect survey (misstating location, dimensions, area, easements or improvements upon land).

69. "Mechanics' lien" claims (securing payment of contractors and material suppliers for

improvements) which may attach without recorded notice.

70. Federal estate or state inheritance tax liens (may attach without recorded notice).

71. Pre-existing violation of subdivision mapping laws.

72. Pre-existing violation of zoning ordinances.

73. Pre-existing violation of conditions, covenants and restrictions affecting the land. The EAGLE

Policy is our most comprehensive coverage. Subject to availability in your area, the Eagle

Policy covers all of the risks listed above, plus these:

74. Post-policy forgery against the insured interest.

75. Forced removal of residential improvements due to lack of an appropriate building permit

(subject to deductible).

76. Post-policy construction of improvements by a neighbor onto insured land.

77. Damage to residential structures from use of the surface of insured land for extraction or

development of minerals. Let First American help you avoid title problems.

167

07/24/2012

http://www.firstam.com/title/resources/reference-information/title-insurance-reference-articles/70-ways-to-lose-your-property.html

You are here: EPA Home OSWER Underground Storage Tanks Overview Of The Federal UST Program

Underground Storage TanksRecent Additions | Contact Us Search: All EPA This Area

Overview Of The Federal UST Program

What is an UST?

An underground storage tank system (UST) is a tank and any underground piping connected tothe tank that has at least 10 percent of its combined volume underground. The federal USTregulations apply only to underground tanks and piping storing either petroleum or certainhazardous substances.

When the UST program began, there were approximately 2.1 million regulated tanks in the U.S.Today there are far fewer since many substandard UST systems have been closed. For the mostcurrent statistics available, see the UST Performance Measures. Nearly all USTs at these sitescontain petroleum. These sites include marketers who sell gasoline to the public (such as servicestations and convenience stores) and nonmarketers who use tanks solely for their own needs(such as fleet service operators and local governments). EPA estimates that less than 10,000tanks hold hazardous substances covered by the UST regulations.

Why be concerned about USTs?

Until the mid-1980s, most USTs were made of bare steel, which is likely to corrode over time andallow UST contents to leak into the environment. Faulty installation or inadequate operating andmaintenance procedures also can cause USTs to release their contents into the environment.

The greatest potential hazard from a leaking UST is that the petroleum or other hazardoussubstance can seep into the soil and contaminate groundwater, the source of drinking water fornearly half of all Americans. A leaking UST can present other health and environmental risks,including the potential for fire and explosion.

How have Congress and EPA responded to concerns about USTs?

In 1984, Congress responded to the increasing threat to groundwater posed by leaking USTs byadding Subtitle I to the Solid Waste Disposal Act. Subtitle I required EPA to develop acomprehensive regulatory program for USTs storing petroleum or certain hazardous substances.

Congress directed EPA to publish regulations that would require owners and operators of newtanks and tanks already in the ground to prevent, detect, and clean up releases. At the sametime, Congress banned the installation of unprotected steel tanks and piping beginning in 1985.

In 1986, Congress amended Subtitle I and created the Leaking Underground Storage Tank TrustFund, which is to be used for two purposes:

1. To oversee cleanups by responsible parties.2. To pay for cleanups at sites where the owner or operator is unknown, unwilling, or unable

to respond, or which require emergency action.

The 1986 amendments also established financial responsibility requirements. Congress directedEPA to publish regulations that would require UST owners and operators to demonstrate they arefinancially capable of cleaning up releases and compensating third parties for resulting damages.

The Energy Policy Act of 2005 amended Subtitle I. The UST provisions of the Energy Policy Actfocus on preventing releases. It expands the use of the LUST Trust Fund and includes provisionsregarding inspections, operator training, delivery prohibition, secondary containment and financialresponsibility, and cleanup of releases that contain oxygenated fuel additives.

UndergroundStorage TanksHome

Basic Information

Where You Live

A-Z Index

Prevention

Cleanup

Biofuels

PetroleumBrownfields

Laws, Regulations,and Policies

Publications

Region, State,Tribal, and LocalContacts

Share

Go

168

In the American Recovery and Reinvestment Act of 2009 (Recovery Act) , Congressappropriated $200 million from the LUST Trust Fund to EPA for cleaning up leaks from USTs. EPAallocated $190.7 million to states and territories in assistance agreements to address shovel readysites within their jurisdictions; $6.3 million for site assessment and cleanup activities in Indiancountry; and EPA retained $3 million by EPA for management and oversight.

Do all tanks have to meet federal EPA regulations?

The following USTs do not need to meet federal requirements for USTs:

Farm and residential tanks of 1,100 gallons or less capacity holding motor fuel used fornoncommercial purposes; Tanks storing heating oil used on the premises where it is stored; Tanks on or above the floor of underground areas, such as basements or tunnels; Septic tanks and systems for collecting storm water and wastewater; Flow-through process tanks; Tanks of 110 gallons or less capacity; and Emergency spill and overfill tanks.

Some state/local regulatory authorities, however, may include these tank types--be sure youcheck with these authorities.

What are the federal requirements for USTs?

In 1988, EPA issued UST regulations divided into three sections: technical requirements, financialresponsibility requirements, and state program approval objectives (as described below).

Technical requirements for USTs

EPA's technical regulations for USTs are designed to reduce the chance of releases fromUSTs, detect leaks and spills when they do occur, and secure a prompt cleanup. USTowners and operators are responsible for reporting and cleaning up any releases. (See"Preventing Releases", "Detecting Releases", and "Cleaning Up Releases.") EPA produceda 36-page booklet called "Musts For USTs" that clearly presents the UST regulatoryrequirements.

Financial responsibility regulations for USTs

The financial responsibility regulations designed to ensure that, in the event of a leak orspill, an owner or operator will have the resources to pay for costs associated withcleaning up releases and compensating third parties. (See "Financial Responsibility.") EPAproduced a 16-page booklet called "Dollars And Sense" that clearly presents theseregulatory requirements.

State program approval objectives

EPA recognizes that, because of the large size and great diversity of the regulatedcommunity, state and local governments are in the best position to oversee USTs. SubtitleI allows state UST programs approved by EPA to operate in lieu of the federal program,and EPA's state program approval regulations set standards for state programs to meet.(See "State Program Approval (SPA)" for more information.) States may have morestringent regulations than the federal requirements. If you are interested in requirementsfor USTs, contact your state UST program for information on state requirements.

Need more information?

See basic information EPA developed about the underground storage tank program.

Top of page

169

H o m e W a t e r T e s t i n g

Regardless of your water source, here are two situations that may require testing:

Do you suspect lead may be in some of your household plumbing materials and water service lines?

Most water systems test for lead as a regular part of water monitoring. These tests give a system-wide picture, but do not refl ect conditions at a specifi c household faucet.If you want to know if your home’s drinking water contains unsafe levels of lead, have your water tested. Testing is the only way to confi rm if lead is present or absent.

Some faucet and pitcher fi lters can remove lead from drinking water. If you use a fi lter to remove lead, be sure you get one that is certifi ed to remove lead by NSF International.

For more information, visit www.epa.gov/safewater/lead, or call the Safe Drinking Water Hotline at 1-800-426-4791.

Are you considering a home water treatment unit?

Find out what is in your water and what you might want to remove before contacting potential dealers. Be informed so you can make the right decisions. To help you, please visit: www.epa.gov/safewater/faq/faq.html#hwtu and www.epa.gov/safewater/wot.

Should I Have My Water Tested? The answer to this question depends on several factors. It concerns your health and the health of your family, so you need to know some basic facts.

In addition to illness, a variety of less serious problems such as taste, color, odor and staining of clothes or fi xtures are signs of possible water quality problems. Other things to think about include the nearness of your water well to septic systems and the composition of your home’s plumbing materials.

This fact sheet provides information to help you decide whether or not to have your water tested, and if so, suggested tests for your situation.

Public Water Systems

When you turn on the tap, where does the water come from? If you pay a water bill, you are purchasing water from a public water system, where your water is monitored,

tested and the results reported to the federal, state or tribal drinking water agencies responsible for making sure it meets the National Primary Drinking Water Standards. Your water company must notify you when contaminants are in the water they provide that may cause illness or other problems.

Most people in the United States receive water from a community water system that provides its customers with

an annual water quality report, also known as a Consumer Confi dence Report. Normally, you will receive it with your water bill once a year in July. The report contains information on contaminants found, possible health effects, and the water’s source. If you do not receive a report, contact your water company for this information.

Private Water Supplies

If your drinking water does not come from a public water system, or you get your drinking water from a household well, you alone are responsible for assuring that it is safe.

For this reason, routine testing for a few of the most common contaminants is highly recommended. Even if you currently have a safe, pure water supply, regular testing can be valuable because it establishes a record of water quality. This record is helpful in solving any future problems and in obtaining compensation if someone damages your water supply.

170

The following items will help you determine when to test your private drinking water supply.

How frequently should I test?Test water every year for total coliform bacteria, nitrates, total dissolved solids and pH levels, especially if you have a new well, or have replaced or repaired pipes, pumps or the well casing.

Do you expect to have a new baby in the household? Test for nitrate in the early months of a pregnancy, before bringing an infant home, and again during the fi rst six months of the baby’s life. It is best to test for nitrate during the spring or summer following a rainy period.

Do you have taste, odor and staining issues? Test for sulfate, chloride, iron, manganese, hardness and corrosion, and every three years. If you suspect other contaminants, test for these also.

Have you had a chemical or fuel spill or leak near your water supply? Test your well for chemical contaminants, such as volatile organic compounds. Tests can be expensive; limit them to possible problems specifi c to your situation. Local experts can tell you about possible impurities in your area.

Is someone in your household pregnant or nursing an infant? Are there unexplained illnesses in your family? Do you notice a change in water taste, odor, color or clarity? You may need to test more than once a year.

Do you know who can test your water? Often county health departments will help you test for bacteria or nitrates. If not, you can have your water tested by a state certifi ed laboratory. You can fi nd one in your area by calling the Safe Drinking Water Hotline at 800-426-4791 or visiting www.epa.gov/safewater/labs.

Collecting Samples

Most testing laboratories or services supply their own sample containers. Use the containers provided and carefully follow the instructions given for collecting, preserving and handling water samples. Samples for coliform bacteria testing must be collected using sterile containers and under sterile conditions. Some procedures require that water runs from an outside tap for several minutes before fi lling the sample containers. Laboratories may sometimes send a trained technician to collect the sample or to analyze the sample directly in your home. Ask if this service is available, since you may obtain better samples and more reliable test results.

Offi ce of Water (4606) www.epa.gov/safewater EPA 816-F-05-013 May 2005

WHEN TO TEST YOUR WATERConditions or nearby activities Recommended Test

Recurrent gastro-intestinal illness Coliform bacteria

Household plumbingcontains lead

pH, lead, copper

Radon in indoor air or region is radon rich

Radon

Scaly residues, soaps don’t lather Hardness

Water softener needed to treat hardness

Manganese, iron

Stained plumbing fi xtures, laundry

iron, copper, manganese

Objectionable taste or smell Hydrogen sulfi de, corrosion, metals

Water appears cloudy, frothy or colored

Color, detergents

Corrosion of pipes, plumbing Corrosion, pH, lead

Rapid wear of water treatment equipment

pH, corrosion

Nearby areas of intensive agriculture

Nitrate, pesticides, coliform bacteria

Coal or other mining operation nearby

Metals, pH, corrosion

Gas drilling operation nearby Chloride, sodium, barium, strontium

Odor of gasoline or fuel oil, and near gas station or buried fuel tanks

Volatile organic compounds (VOC)

Dump, junkyard, landfi ll, factory or dry-cleaning operation nearby

VOC, Total disolved solids (TDS), pH, sulfate, chloride,

metals

Salty taste and seawater, or a heavily salted roadway nearby

Chloride, TDS, sodium

171

WATER ON TAPwhat you need to know

172

Office of Water (4601)EPA 816-K-09-002www.epa.gov/safewaterDecember 2009 Printed on Recycled Paper

Table of Contents

Chapter Page No.

1. A Consumer’s Guide To The Nation’s Drinking Water . . . . . . . . . . . . . . . . . . . . . . . . .1

2. How Safe Is My Drinking Water? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2

3. Where Does My Drinking Water Come From And How Is It Treated? . . . . . . . . . . . . .7

4. How Do We Use Drinking Water In Our Homes? . . . . . . . . . . . . . . . . . . . . . . . . . . . .10

5. What’s Being Done To Improve Water Security? . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13

6. What Can I Do If There Is A Problem With My Drinking Water? . . . . . . . . . . . . . . . .15

7. How Safe Is The Drinking Water In My Household Well? . . . . . . . . . . . . . . . . . . . . .18

8. What You Can Do To Protect Your Drinking Water . . . . . . . . . . . . . . . . . . . . . . . . . . .21

Appendix A: National Primary Drinking Water Standards as of 10/03 . . . . . . . . . . . . . . . . . . . . . . .23

Appendix B: References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28

Appendix C: Sources of Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29

Appendix D: Glossary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31

173

The United States enjoys one of the best supplies of drinking water in the world. Nevertheless, many of us who once gave little or no thought to the water that comes from our taps are now asking the ques-tion: “Is my water safe to drink?” While tap water that meets federal and state standards is generally safe to drink, threats to drinking water are increasing. Short-term disease outbreaks and water restrictions during droughts have demonstrated that we can no longer take our drinking water for granted.

Consumers have many questions about their drinking water. How safe is my drinking water? What is being done to improve security of public water systems? Where does my drinking water come from, and how is it treated? Do private wells receive the same pro-tection as public water systems? What can I do to help protect my drinking water?

1. A Consumer’s Guide To The Nation’s Drinking Water

Sensitive Subpopulations

Some people may be more vulnerable to con-taminants in drinking water than the general population. People undergoing chemotherapy or living with HIV/AIDS, transplant patients, children and infants, the frail elderly, and preg-nant women and their fetuses can be particu-larly at risk for infections.

If you have special health care needs, con-sider taking additional precautions with your drinking water, and seek advice from your health care provider. For more information, see www.epa.gov/safewater/healthcare/special.html.

You will find information on bottled water and home water treatment units on page 16 of this booklet. You may also contact NSF International, Underwriter’s Laboratory, or the Water Quality Association. Contact information is located in Appendix C.

This booklet provides the answers to these and other frequently asked questions.

This booklet also directs you to more detailed sources of information. Often, you will be directed to a page on the EPA website. Additionally, the Safe Drinking Water Hotline is available to answer your questions. Please also see Appendix C for more resources. Refer to the Glossary (Appendix D) for definitions of words in bold font.

1

www.epa.gov/safewater Safe Drinking Water Hotline: 800-426-4791

What you need to know to protect your family

174

2


What Law Keeps My Drinking Water Safe?

Congress passed the Safe Drinking Water Act (SDWA) in 1974 to protect public health by regulat-ing the nation’s public drinking water supply and protecting sources of drinking water. SDWA is administered by the U.S. Environmental Protection Agency (EPA) and its state partners.

What Is A Public Water System?

The Safe Drinking Water Act (SDWA) defines a public water system (PWS) as one that serves piped water to at least 25 persons or 15 service connections for at least 60 days each year. There are approxi-mately 161,000 public water systems in the United States.1 Such systems may be publicly or privately owned. Community water systems (CWSs) are public water systems that serve people year-round in their homes. Most people in the U.S. (268 million) get their water from a community water system. EPA also regulates other kinds of public water systems,

2. How Safe Is My Drinking Water?

Highlights of the Safe Drinking Water Act

• Authorizes EPA to set enforceable health stan-dards for contaminants in drinking water

• Requirespublicnotificationofwatersystemsviolations and annual reports (Consumer Confidence Reports) to customers on con-taminants found in their drinking water - www.epa.gov/safewater/ccr

• Establishesafederal-statepartnershipforregu-lation enforcement

• Includesprovisionsspecificallydesignedtoprotect underground sources of drinking water - www.epa.gov/safewater/uic

• Requiresdisinfectionofsurfacewatersupplies,except those with pristine, protected sources

• Establishesamulti-billion-dollarstaterevolv-ing loan fund for water system upgrades - www.epa.gov/safewater/dwsrf

• Requiresanassessmentofthevulnerabilityofall drinking water sources to contamination - www.epa.gov/safewater/protect

— Drinking Water: Past, Present, and Future EPA-816-F-00-002

Public Water Systems

Community Water System (54,000 systems)—A public water system that serves the same people year-round. Most residences are served by Community Water Systems.

Non-Community Water System ( approximately 108,000 systems)—A public water system that does not serve the same people year-round. There are two types of non-community systems:

• Non-TransientNon-CommunityWaterSystem (almost 19,000 systems)—A non-community water system that serves the same people more than six months of the year, but not year-round. For example, a school with its own water supply is consid-ered a non-transient system.

• TransientNon-CommunityWaterSystem(more than 89,000 systems)—A non- community water system that serves the public but not the same individuals for more than six months. For example, a rest area or a campground may be considered a transient system.

175

3


such as those at schools, campgrounds, factories, and restaurants. Private water supplies, such as household wells that serve one or a few homes, are not regulated by EPA. For information on household wells, see “How Safe Is The Drinking Water In My Household Well?” on page 18 of this booklet.

WillWaterSystemsHaveAdequateFunding In The Future?

Nationwide, drinking water systems have spent hun-dreds of billions of dollars to build drinking water treatment and distribution systems. From 1995 to 2000, more than $50 billion was spent on capital investments to fund water quality improvements.2

With the aging of the nation’s infrastructure, the clean water and drinking water industries face a signifi-cant challenge to sustain and advance their achieve-ments in protecting public health. EPA’s Clean Water & Drinking Water Infrastructure Gap Analysis3 has found that if present levels of spending do not increase, there will be a significant funding gap by the year 2019.

Where Can I Find Information About My Local Water System?

Since 1999, water suppliers have been required to provide annual Consumer Confidence Reports to their customers. These reports are due by July 1 each year, and contain information on contaminants found

in the drinking water, possible health effects, and the water’s source. Some Consumer Confidence Reports are available at www.epa.gov/safewater/dwinfo.htm.

Water suppliers must promptly inform you if your water has become contaminated by something that can cause immediate illness. Water suppliers have 24 hours to inform their customers of violations of EPA standards “that have the potential to have seri-ous adverse effects on human health as a result of short-term exposure.” If such a violation occurs, the water system will announce it through the media, and must provide information about the potential adverse effects on human health, steps the system is taking to correct the violation, and the need to use alternative water supplies (such as boiled or bottled water) until the problem is corrected.

Systems will inform customers about violations of less immediate concern in the first water bill sent after the violation, in a Consumer Confidence Report, or by mail within a year. In 1998, states began com-piling information on individual systems, so you can evaluate the overall quality of drinking water in your state. Additionally, EPA must compile and summarize the state reports into an annual report on the condi-tion of the nation’s drinking water. To view the most recent annual report, see www.epa.gov/safewater/annual.

How Often Is My Water Supply Tested?

EPA has established pollutant-specific minimum test-ing schedules for public water systems. To find out how frequently your drinking water is tested, contact your water system or the agency in your state in charge of drinking water.

If a problem is detected, immediate retesting require-ments go into effect along with strict instructions about how the system informs the public. Until the system can reliably demonstrate that it is free of problems, the retesting is continued.

In 2001, one out of every four community water systems did not conduct testing or report the results for all of the monitoring required to verify the safety

Cost of Making Water Safe Continues to Rise

Much of the existing water infrastructure (underground pipes, treatment plants, and other facilities) was built many years ago. In 1999, EPA conducted the second Drinking Water Infrastructure Needs Survey, and found that drinking water systems will need to invest $150 billion over a 20-year period to ensure clean and safe drinking water.

176

4


of their drinking water.4 Although failure to monitor does not necessar-ily suggest safety problems, conduct-ing the required reporting is crucial to ensure that problems will be detected. Consumers can help make sure certain monitoring and reporting requirements are met by first contacting their state drinking water agency to determine if their water supplier is in compliance. If the water system is not meeting the requirements, consumers can work with local and state officials and the water supplier to make sure the required mon-itoring and reporting occurs.

A network of government agencies monitor tap water suppliers and enforce drinking water standards to ensure the safety of public water supplies. These agencies include EPA, state depart-ments of health and environment, and local public health departments. Nevertheless, problems with local drinking water can,

and do, occur.

What Problems Can Occur?

Actual events of drinking water contamination are rare, and typically do not occur at levels likely to pose health concerns. However, as development in our modern society increases, there are growing numbers of activities that can contaminate our drink-ing water. Improperly disposed-of chemicals, animal and human wastes, wastes injected underground, and naturally occurring substances have the potential to contaminate drinking water. Likewise, drinking water that is not properly treated or disinfected, or that travels through an improperly maintained distribution system, may also pose a health risk. Greater vigilance by you, your water supplier, and your government can help prevent such events in your water supply.

Contaminants can enter water supplies either as a result of human and animal activities, or because they occur naturally in the environment. Threats to your drinking water may exist in your neighborhood, or may occur many miles away. For more information on drinking water threats, see www.epa.gov/safewater/

District ofColumbia

0% - 6% of Systems 6% - 11% of Systems 11+% of Systems

Reported Community Water Systems Violating Maximum Contaminant Levels or Treatment

Standards in FY 2002

Common Sources of Pollution

Naturally Occurring: microorganisms (wild-life and soils), radionuclides (under lying rock), nitrates and nitrites (nitrogen compounds in the soil), heavy metals (underground rocks containing arsenic, cadmium, chromium, lead, and selenium), fluoride.

Human Activities: bacteria and nitrates (human and animal wastes—septic tanks and large farms), heavy metals (mining construc-tion, older fruit orchards), fertilizers and pes-ticides (used by you and others (anywhere crops or lawns are maintained)), industrial products and wastes (local factories, indus-trial plants, gas stations, dry cleaners, leak-ing underground storage tanks, landfills, and waste dumps), household wastes (cleaning solvents, used motor oil, paint, paint thinner), lead and copper (household plumbing materi-als), water treatment chemicals (waste water treatment plants).

177

5


publicoutreach/landscapeposter.html. Some typical examples are microbial contamination, chemical con-tamination from fertilizers, and lead contamination.

Microbial Contamination:

The potential for health problems from microbial-contaminated drinking water is demonstrated by localized outbreaks of waterborne disease. Many of these outbreaks have been linked to contamination by bacteria or viruses, probably from human or animal wastes. For example, in 1999 and 2000, there were 39 reported disease outbreaks associated with drinking water, some of which were linked to public drinking water supplies.5

Certain pathogens (disease-causing microorgan-isms), such as Cryptosporidium, may occasionally pass through water filtration and disinfection process-es in numbers high enough to cause health problems, particularly in vulnerable members of the population. Cryptosporidium causes the gastrointestinal disease, cryptosporidiosis, and can cause serious, some-times fatal, symptoms, especially among sensitive members of the population. (See box on Sensitive Subpopulations on page 1.) A serious outbreak of cryptosporidiosis occurred in 1993 in Milwaukee, Wisconsin, causing more than 400,000 persons to be infected with the disease, and resulting in at least 50 deaths. This was the largest recorded outbreak of waterborne disease in United States history.6

Chemical Contamination From Fertilizers:

Nitrate, a chemical most commonly used as a fertil-izer, poses an immediate threat to infants when it is found in drinking water at levels above the national standard. Nitrates are converted to nitrites in the intestines. Once absorbed into the bloodstream, nitrites prevent hemoglobin from transporting oxy-gen. (Older children have an enzyme that restores hemoglobin.) Excessive levels can cause “blue baby syndrome,” which can be fatal without immediate medical attention. Infants most at risk for blue baby syndrome are those who are already sick, and while they are sick, consume food that is high in nitrates or drink water or formula mixed with water that is high in nitrates. Avoid using water with high nitrate levels for drinking. This is especially important for infants and young children, nursing mothers, pregnant women and certain elderly people.

Boil Water Notices for Microbial Contaminants

When microorganisms such as those that indicate fecal contami-

nation are found in drinking water, water suppliers arerequiredtoissue“BoilWaterNotices.”Boilingwater for one minute kills the microorganisms that cause disease. Therefore, these notices serve as a precaution to the public. www.epa.gov/safewater/faq/emerg.html

Nitrates: Do NOT Boil

Do NOT boil water to attempt to reduce nitrates.

Boiling water contaminated with nitrates increases its concentration and potential risk. If you are concerned about nitrates, talk to your health care provider about alternatives to boiling water for baby formula.

Excessive levels of nitrates can cause

“blue baby syndrome,” which can be fatal

without immediate

medical attention.

178

6


Lead Contamination:

Lead, a metal found in natural deposits, is commonly used in household plumbing materials and water service lines. The greatest exposure to lead is swal-lowing lead paint chips or breathing in lead dust. But lead in drinking water can also cause a variety of adverse health effects. In babies and children, exposure to lead in drinking water above the action level of lead (0.015 milligram per liter) can result in delays in physi-cal and mental development, along with slight deficits in attention span and learn-ing abilities. Adults who drink this water over many years could develop kidney problems or high blood pres-sure. Lead is rarely found in source water, but enters tap water through corrosion of plumbing materials. Very old and poorly maintained homes may be more likely to have lead pipes, joints, and solder. However, new homes are also at risk: pipes legally considered to be “lead-free” may contain up to eight percent lead. These pipes can leach signifi-cant amounts of lead in the water for the first several months after their installation. For more information on lead contamination, see www.epa.gov/safewater/con-taminants/dw_contamfs/lead.html.

For more information on drinking water contaminants that are regulated by EPA, see Appendix A, or visit www.epa.gov/safewater/mcl.html.

Where Can I Find More Information About My Drinking Water?

Drinking water varies from place to place, depending on the water’s source and the treatment it receives. If your drinking water comes from a community water system, the system will deliver to its customers annual drinking water quality reports (or Consumer Confidence Reports). These reports will tell consumers what contaminants have been detected in their drinking water, how these detection levels compare to drink-ing water standards, and where their water comes from. The reports must be provided annually before July 1, and, in most cases, are mailed directly to customers’ homes. Contact your water suppli-er to get a copy of your report, or see if your report is posted online

at www.epa.gov/safewater/dwinfo.htm. Your state’s department of health or environment can also be a valuable source of information. For help in locating these agencies, call the Safe Drinking Water Hotline. Further resources can be found in Appendix C. Information on testing household wells is on page 19.

1 Factoids: Drinking Water & Ground Water Statistics for 2002, 2003.

2 Community Water Systems Survey 2000, Volume I, 2001.3 The Clean Water and Drinking Water Infrastructure Gap

Analysis, EPA 816-R-02-020.4 Factoids: Drinking Water and Ground Water Statistics for

2001, EPA 816-K-02-004.5 Morbidity and Mortality Weekly Report: Surveillance for

Waterborne Disease Outbreaks, United States 1999-2000, 2002.

6 25 Years of the Safe Drinking Water Act, 1999.

Lead: Do NOT Boil

Do NOT boil water to attempt to reduce lead. Boiling water increases lead concentration.

Always use water from the cold tap for pre-paring baby formula, cooking, and drinking. Flush pipes first by running the water before using it. Allow the water to run until it’s cold. If you have high lead levels in your tap water, talk to your health care provider about alter-natives to using boiled water in baby formula.

179

7


Your drinking water comes from surface water or ground water. The water that systems pump and treat from sources open to the atmosphere, such as rivers, lakes, and reservoirs is known as surface water. Water pumped from wells drilled into under-ground aquifers, geologic formations containing water, is called ground water. The quantity of water produced by a well depends on the nature of the rock, sand, or soil in the aquifer from which the water is drawn. Drinking water wells may be shallow (50 feet or less) or deep (more than 1,000 feet). More water systems have ground water than surface water as a source (approx. 147,000 v. 14,500), but more people drink from a surface water system (195 million v. 101,400). Large-scale water supply systems tend to rely on surface water resources, while smaller water systems tend to use ground water. Your water utility or public works department can tell you the source of your public water supply.

How Does Water Get To My Faucet?

An underground network of pipes typically delivers drinking water to the homes and businesses served by the water system. Small systems serving just a hand-ful of households may be relatively simple, while large metropolitan systems can be extremely com-plex—sometimes consisting of thousands of miles of pipes serving millions of people. Drinking water must meet required health standards when it leaves the treatment plant. After treated water leaves the plant, it is monitored within the distribution system to identify and remedy any problems such as water main breaks, pressure variations, or growth of microorganisms.

How Is My Water Treated To Make It Safe?

Water utilities treat nearly 34 billion gallons of water every day.1 The amount and type of treatment applied varies with the source and quality of the water. Generally, surface water systems require more treat-ment than ground water systems because they are directly exposed to the atmosphere and runoff from rain and melting snow.

Water suppliers use a variety of treatment processes to remove contaminants from drinking water. These individual processes can be arranged in a “treatment train” (a series of processes applied in a sequence). The most commonly used processes include coagu-lation (flocculation and sedimentation), filtration, and disinfection. Some water systems also use ion exchange and adsorption. Water utilities select the treatment combination most appropriate to treat the contaminants found in the source water of that par-ticular system.

Coagulation (Flocculation & Sedimentation):

Flocculation: This step removes dirt and other par-ticles suspended in the water. Alum and iron salts or synthetic organic polymers are added to the water to form tiny sticky particles called “floc,” which attract the dirt particles.

3. Where Does My Drinking Water Come From And How Is It Treated?

All sources of drinking water contain some naturally occurring contaminants. At low levels, these contaminants generally are not harmful in our drinking water. Removing all contaminants would be extremely expensive, and in most cases, would not provide increased protection of public health. A few naturally occurring min-erals may actually improve the taste of drinking water and may even have nutritional value at low levels.

180

8


Sedimentation: The flocculated particles then settle naturally out of the water.

Filtration:

Many water treatment facilities use filtration to remove all particles from the water. Those particles

include clays and silts, natural organic matter, precip-itates from other treatment processes in the facility, iron and manganese, and microorganisms. Filtration clarifies the water and enhances the effectiveness of disinfection.

Storage: Water is placed in a closed tank or reservoir for disinfection to take place. The water then flows through pipes to homes and businesses in the community.

Source: AWWA Drinking Water Week Blue Thumb Kit

Filtration: The water passes through filters, some made of layers of sand, gravel, and charcoal that help remove even smaller particles.

Sedimentation: The heavy particles (floc) settle to the bottom and the clear water moves to filtration.

Disinfection: A small amount of chlorine is added or some other disinfection method is used to kill any bacteria or microorganisms that may be in the water.

Coagulation removes dirt and other particles suspended in water. Alum and other chemicals are added to water to form tiny sticky particles called “floc” which attract the dirt particles. The combined weight of the dirt and the alum (floc) become heavy enough to sink to the bottom during sedimentation.

Lake or Reservoir

Water Treatment Plant

Follow a drop of water from the source through the treatment process. Water may be treated differently indifferentcommunitiesdependingonthequalityofthewaterwhichenterstheplant.Groundwaterislocatedundergroundandtypicallyrequireslesstreatmentthanwaterfromlakes,rivers,andstreams.

181

9


Disinfection Byproducts

Disinfection of drinking water is one of the major public health advances of the 20th century. However, sometimes the disinfec-tants themselves can react with naturally occurring materials in the water to form unintended byproducts, which may pose health risks. EPA recognizes the importance of removing microbial contaminants while simultaneously protecting the public from disinfection byproducts, and has developed regulations to limit the presence of these byproducts. For more information, see www.epa.gov/safewater/mdbp.html.

Disinfection:

Disinfection of drinking water is considered to be one of the major public health advances of the 20th century. Water is often disinfected before it enters the distribution system to ensure that dangerous micro-bial contaminants are killed. Chlorine, chlorinates, or chlorine dioxides are most often used because they are very effective disinfectants, and residual concen-trations can be maintained in the water system.

Why Is My Water Bill Rising?

The cost of drinking water is rising as suppliers meet the needs of aging infrastructure, comply with pub-lic health standards, and expand service areas. In most cases, these increasing costs have caused water suppliers to raise their rates. However, despite rate increases, water is generally still a bargain compared to other utilities, such as electricity and phone ser-vice. In fact, in the United States, combined water and sewer bills average only about 0.5 percent of household income.2

1 Protect Your Drinking Water, 2002.2 Congressional Budget Office Study: Future Investment in

Drinking Water & Wastewater Infrastructure, 2002.

Water System Filtration Tank

Water passes through charcoal, sand, and gravel layers in a water system’s filtration tank.

182

10


We take our water supplies for granted, yet they are limited. Only one percent of all the world’s water can be used for drinking. Nearly 97 percent of the world’s water is salty or otherwise undrinkable, and the other two percent is locked away in ice caps and glaciers. There is no “new” water: whether our source water is a stream, river, lake, spring, or well, we are using the same water the dinosaurs used mil-lions of years ago.

The average American uses about 90 gallons of water each day in the home, and each American household uses approximately 107,000 gallons of water each year.1 For the most part, we use water treated to meet drinking water standards to flush toilets, water lawns, and wash dishes, clothes, and cars. In fact, 50-70 percent of home water is used for watering lawns and gardens.2 Nearly 14 percent of the water a typi-cal homeowner pays for is never even used—it leaks down the drain.3

How Much Water Do Homes In The U.S. Use Compared To Other Countries?

Americans use much more water each day than indi-viduals in both developed and undeveloped countries: For example, the average European uses 53 gallons; the average Sub-Saharan citizen, 3-5 gallons.4

Water efficiency plays an impor-tant role in protecting water sourc-es and improving water quality. By using water wisely, we can save money and help the environment. Water efficiency means using less water to provide the same benefit. Using water-saving techniques could save you hundreds of dollars each year, while also reducing the amount of pollutants entering our waterways.

How Do Drinking Water Utilities Conserve Water?

Water utilities forecast water source availability, growth in population, and water demand to

ensure adequate future water supplies during normal conditions, as well as periods of drought. When water shortages are predicted or experienced, water utilities have many options for conserving water. Temporary cutbacks or permanent operating adjustments can help conserve water.

Temporary cutbacks may include:• Reductionofsystem-wideoperatingpressure,and• Waterusebans,restrictions,andrationing.

4. How Do We Use Drinking Water In Our Homes?

Common Household Uses of Drinking Water* (*Gallons per Capita per Day)

Bathing, 20 gpcdToilet Flushing, 24 gpcd

Laundry8.5 gpcd

Drinking and Cooking, 2 gpcdGarbage Disposal, 1 gpcd

Dishwasher, 4 gpcd

CarWashing2.5 gpcd

Lawn Watering and Pools, 25 gpcd Source: Van Der Leeden, F., F. L. Troise, and D. K. Todd.

The Water Encyclopedia. Lewis Publishers, Inc. Second Edition, 1990.

183

11


Permanent conservation measures may include:• Subsidizinguseofwater-efficientfaucets,toilets,

and showerheads,• Publiceducationandvoluntaryusereduction,• Billingpracticesthatimposehigherratesforhigh-

er amounts of water use,• Buildingcodesthatrequirewater-efficientfixtures

and appliances,• Leakdetectionsurveysandmetertesting,repair,

and replacement, and• Reductioninuseandincreaseinrecyclingof

industrial water.

How Can Businesses Conserve Water?

The industrial and commercial sectors can con-serve water through recycling and waste reduction. Industry has implemented conservation measures to comply with state and federal water pollution con-

trols. Evaluation of industrial plant data may show that a particular process or manufacturing step uses the most water or causes the greatest contamination. Such areas can be targeted for water conservation. Also, water that is contaminated by one process may be usable in other plant processes that do not require high-quality water.

How Can I Conserve Water?

The national average cost of water is $2.00 per 1,000 gallons. The average American family spends about $474 each year on water and sewage charges.5 American households spend an additional $230 per year on water heating costs.6 By replacing appliances such as the dishwasher and inefficient fixtures such as toilets and showerheads, you can save a substantial amount each year in water, sewage, and energy costs.

There are many ways to save water in and around your home. Here are the five that might get the best results:

Ways To Save Water At Home* (*Water Savings as Percent of Total Interior Water Use)

Low-Flow Showerheads(or Flow Restrictors), 12 percent

Source: Corbitt, Robert A.Standard Handbook of Environmental Engineering.McGraw-Hill, Inc. 1989.

Low-Water UseClothes Washers, 5 percent

Low-Water Use Toilets(or Plastic Bottles or Water Dams in Toilet Reservoir), 18 percent

Low-Flow Aerators on Faucets (or Replacement

Faucets), 2 percent

Low-Water UseDishwasher, 4 percent

Insulation onHot Water Lines,

4 percent

184

12


• Stop Leaks.• Replace Old Toilets with models that use 1.6

gallons or less per flush.• Replace Old Clothes Washers with EPA Energy

Star certified models.• Plant the Right Kind of Garden that requires less

water.• Provide Only the Water Plants Need.

For more information on ways to conserve water in the home, see www.epa.gov/water/waterefficiency.html or www.h2ouse.org.

1 Water Trivia Facts, EPA 80-F-95-001.2 AWWA Stats on Tap.3 Using Water Wisely in the Home, 2002.4 The Use of Water Today, World Water Council.5 Investing in America’s Water Infrastructure, 2002.6 Using Water Wisely in the Home, 2002.

Nearly 14 percent of the water a typical homeowner pays for is never even used— it leaks down the drain. Using Water Wisely in the Home, 2002

185

13


What Security Measures Are In Place To Protect Water Systems?

Drinking water utilities today find themselves fac-ing new responsibilities due to concerns over water system security and counter-terrorism. EPA is com-mitted to the safety of public drinking water supplies and has taken numerous steps to work with utilities, other government agencies, and law enforcement to minimize threats.

The Public Health Security and Bioterrorism Preparedness and Response Act of 2002 requires that all community water systems serving more than 3,300 people evaluate their susceptibility to potential threats and identify corrective actions. EPA has provided assistance to help utilities with these Vulnerability Assessments by giving direct grants to large systems, supporting self-assessment tools, and providing tech-nical help and training to small and medium utilities. For more information on water system security, see www.epa.gov/safewater/security.

How Can I Help Protect My Drinking Water?

Local drinking water and wastewater systems may be targets for terrorists and other would-be criminals

wishing to disrupt and cause harm to your community water supplies or wastewater facilities.

Because utilities are often located in isolated areas, drinking water sources and wastewater collection sys-tems may cover large areas that are difficult to secure and patrol. Residents can be educated to notice and report any suspicious activity in and around local water utilities. Any residents interested in protecting

their water resources and community as a whole can join together with law enforcement, neighbor-hood watch groups, water suppliers, wastewater operators, and other local public health officials. If you witness suspicious activities, report them to your local law enforcement authorities.

Examples of suspicious activity might include:

• Peopleclimbingorcuttingautilityfence

• Peopledumpingordischargingmaterialtoawater reservoir

5. What’s Being Done To Improve Water Security?

186

14


Do not confront strangers. Instead report suspicious activities to local authorities.

When reporting an incident:

• Statethenatureoftheincident

• Identifyyourselfandyourlocation

• Identifylocationofactivity

• Describeanyvehicleinvolved(color,make,model, plate number)

• Describetheparticipants(howmany,sex,race,color of hair, height, weight, clothing)

For more information on water security, visit: www.epa.gov/safewater/security

• Unidentifiedtruckorcarparkedorloiteringnearwaterway or facilities for no apparent reason

• Suspiciousopeningortamperingwithmanholecovers, fire hydrants, buildings, or equipment

• Peopleclimbingorontopofwatertanks

• Peoplephotographingorvideotapingutility facilities, structures or equipment

• Strangershangingaroundlocksorgates

Report suspicious activity to local

authorities

For emergencies, dial 9-1-1 or other local emergency response numbers.

187

15


Local incidents, such as spills and treatment prob-lems, can lead to short-term needs for alternative water supplies or in-home water treatment. In isolated cases, individuals may need to rely on alternative sources for the long term, due to their individual health needs or problems with obtaining new drinking water supplies.

What Alternative Sources Of Water Are Available?

Bottled water is sold in supermarkets and conve-nience stores. Some companies lease or sell water dispensers or bubblers and regularly deliver large bottles of water to homes and businesses. It is expen-sive compared to water from a public water system. The bottled water quality varies among brands, because of the variations in the source water used, costs, and company practices.

The U.S. Food and Drug Administration (FDA) regu-lates bottled water used for drinking. While most con-sumers assume that bottled water is at least as safe as tap water, there are still potential risks. Although required to meet the same safety standards as public water supplies, bottled water does not undergo the same testing and reporting as water from a treatment facility. Water that is bottled and sold in the same

state may not be subject to any federal standards at all. Those with compromised immune systems may want to read bottled water labels to make sure more stringent treatments have been used, such as reverse osmosis, distillation, UV radiation, or filtration by an absolute 1 micron filter.

Check with NSF International to see if your bottled water adheres to FDA and international drinking water standards. The International Bottled Water Association can also provide information on which brands adhere to even more stringent requirements. Contact information is listed in Appendix C.

Can I Do Anything In My House To Improve The Safety Of My Drinking Water?

Most people do not need to treat drinking water in their home to make it safe. However, a home water treatment unit can improve water’s taste, or provide a factor of safety for those people more vulnerable to waterborne disease. There are different options for home treatment systems. Point-of-use (POU) systems treat water at a single tap. Point-of-entry (POE) systems treat water used throughout the house. POU systems can be installed in various places in

the home, including the counter top, the faucet itself, or under the sink. POE systems are installed where the water line enters the house.

POU and POE devices are based on various contaminant removal technologies. Filtration, ion exchange, reverse osmosis, and distilla-tion are some of the treatment methods used. All types of units are generally available from retailers, or by mail order. Prices can reach well into the hundreds and sometimes thousands of dollars, and depending on the method and location of installation, plumbing can also add to the cost.

6. What Can I Do If There Is A Problem With My Drinking Water?

188

16


Activated carbon filters adsorb organic contami-nants that cause taste and odor problems. Depending on their design, some units can remove chlorination byproducts, some cleaning solvents, and pesticides. To maintain the effectiveness of these units, the car-bon canisters must be replaced periodically. Activated carbon filters are efficient in removing metals such as lead and copper if they are designed to absorb or remove lead.

Because ion exchange units can be used to remove minerals from your water, particularly calcium and magnesium, they are sold for water softening. Some ion exchange softening units remove radium and bar-ium from water. Ion exchange systems that employ activated alumina are used to remove fluoride and

arsenate from water. These units must be regenerated periodically with salt.

Reverse osmosis treatment units generally remove a more diverse list of contaminants than other systems. They can remove nitrates, sodium, other dissolved inorganics, and organic compounds.

Distillation units boil water and condense the result-ing steam to create distilled water. Depending on their design, some of these units may allow vaporized organic contaminants to condense back into the prod-uct water, thus minimizing the removal of organics.

You may choose to boil your water to remove micro-bial contaminants. Keep in mind that boiling reduces

TREATMENT DEVICE WHAT IT DOES TO WATER TREATMENT LIMITATIONS

Activated Carbon Filter

(includes mixed media that remove heavy metals)

Adsorbs organic contaminants that cause taste and odor problems.

Somedesigns remove chlorination byproducts;

Some types remove cleaning solvents and pesticides

Is efficient in removing metals such as lead and copper

Does not remove nitrate, bacteria or dissolved minerals

Ion Exchange Unit

(with activated alumina)

Removes minerals, particularly calcium andmagnesiumthatmakewater“hard”

Some designs remove radium and barium

Removes fluoride

If water has oxidized iron or iron bacteria, the ion-exchange resin will become coated or clogged and lose its softening ability

Reverse Osmosis Unit (with carbon)

Removes nitrates, sodium, other dissolved inorganics and organic compounds

Removes foul tastes, smells or colors

May also reduce the level of some pesticides, dioxins and chloroform and petrochemicals

Does not remove all inorganic and organic contaminants

Distillation Unit Removes nitrates, bacteria, sodium, hardness, dissolved solids, most organic compounds, heavy metals, and radionucleides

Kills bacteria

Does not remove some volatile organic contaminants, certain pesti-cides and volatile solvents

Bacteria may recolonize on the cool-ing coils during inactive periods

189

17


the volume of water by about 20 percent, thus con-centrating those contaminants not affected by the temperature of boiling water, such as nitrates and

Maintaining Treatment Devices

All POU and POE treatment units need main-tenance to operate effectively. If they are not maintained properly, contaminants may accu-mulate in the units and actually make your water worse. In addition, some vendors may make claims about their effectiveness that have no merit. Units are tested for their safety and effectiveness by two organizations, NSF International and Underwriters Laboratory. In addition, the Water Quality Association represents the household, commercial, indus-trial and small community treatment industry and can help you locate a professional that meets their code of ethics. EPA does not test or certify these treatment units.

pesticides. For more information on boiling water, see page 5 of this booklet.

No one unit can remove everything. Have your water tested by a certified laboratory prior to purchasing any device. Do not rely on the tests conducted by salespeople that want to sell you their product.

Where Can I Learn More About Home Treatment Systems?

Your local library has articles, such as those found in consumer magazines, on the effectiveness of these devices.

The U.S. General Accounting Office published a booklet called Drinking Water: Inadequate Regulation of Home Treatment Units Leaves Consumers At Risk (December 1991). To read this booklet, visit www.gao.gov and search for document number RCED-92-34, or call (202) 512-6000.

This treatment device is for point of use (POU).

For more information on different types of devices contact

NSF International, Underwriters Laboratory, or the

Water Quality Association See Appendix C for

contact information.

190

18


EPA regulates public water systems; it does not have the authority to regulate private wells. Approximately 15 percent of Americans rely on their own pri-vate drinking water supplies (Drinking Water from Household Wells, 2002), and these supplies are not subject to EPA standards. Unlike public drinking water systems serving many people, they do not have experts regularly checking the water’s source and its quality before it is sent to the tap. These households must take special precautions to ensure the protection and maintenance of their drinking water supplies.

Drinking Water from Household Wells is an EPA publication available to specifically address special concerns of a private drinking water supply. To learn more, or to obtain a copy, visit www.epa.gov/safewater/privatewells, or call the Safe Drinking Water Hotline.

How Much Risk Can I Expect?

The risk of having problems depends on how good your well is—how well it was built and located, and how well you maintain it. It also depends on your local environment. That includes the quality of the aqui-fer from which your water is drawn and the human activities going on in your area that can affect your well.

Several sources of pollution are easy to spot by sight, taste, or smell. However, many serious problems can be found only by testing your water. Knowing the possible threats in your area will help you decide the kind of tests you may need.

What Should I Do?

There are six basic steps you can take to help protect your private drinking water supply:

1. Identify potential problem sources.

2. Talk with local experts.

3. Have your water tested periodically.

4. Have the test results interpreted and explained clearly.

5. Set and follow a regular maintenance schedule for your well, and keep up-to-date records.

6. Immediately remedy any problems.

Identify Potential Problem Sources

Understanding and spotting possible pollution sources is the first step to safeguarding your drinking water. If your drinking water comes from a well, you may also have a septic system. Septic systems and other

on-site wastewater disposal sys-tems are major potential sources of contamination of private water supplies if they are poorly main-tained or located improperly, or if they are used for disposal of toxic chemicals. Information on septic systems is available from local health departments, state agen-cies, and the National Small Flows Clearinghouse (www.epa.gov/owm/mab/smcomm/nsfc.htm) at (800) 624-8301. A septic system design manual and guidance on system

maintenance are available from EPA (www.epa.gov/OW-OWM.html/mtb/decent/homeowner.htm).

7. How Safe Is The Drinking Water In My Household Well?

191

19


Talk With Local Experts

Ground water conditions vary greatly from place to place, and local experts can give you the best infor-mation about your drinking water supply. Some examples are your health department’s “sanitarian,” local water-well contractors, public water system officials, county extension agents of the Natural Resources Conservation Service (NRCS), local or county planning commissions, and your local library.

Have Your Water Tested Periodically

Test your water every year for total coliform bacteria, nitrates, total dissolved solids, and pH levels. If you suspect other contaminants, test for these as well. As the tests can be expensive, limit them to possible problems specific to your situation. Local experts can help you identify these contaminants. You should also test your water after replacing or repairing any part of the system, or if you notice any change in your water’s look, taste, or smell.

Often, county health departments perform tests for bacteria and nitrates. For other substances, health departments, environmental offices, or county gov-ernments should have a list of state-certified labora-tories. Your State Laboratory Certification Officer can also provide you with this list. Call the Safe Drinking Water Hotline for the name and number of your state’s certification officer. Any laboratory you use should be certified to do drinking water testing.

Have Your Test Results Interpreted And Explained Clearly

Compare your well’s test results to federal and state drinking water standards (see Appendix A, or visit www.epa.gov/safewater/mcl.html or call the Safe Drinking Water Hotline). You may need to consult experts to aid you in understanding your results, such as the state agency that licenses water well contrac-tors, your local health department, or your state’s drinking water program.

Protecting Your Ground Water Supply

• Periodicallyinspectexposedpartsofthewell for problems such as:

- Cracked, corroded, or damaged well casing

- Broken or missing well cap

- Settling and cracking of surface seals.

• Slopetheareaaroundthewelltodrainsur-face runoff away from the well.

• Installawellcaporsanitarysealtopreventunauthorized use of, or entry into, the well.

• Disinfectdrinkingwaterwellsatleastonceper year with bleach or hypochlorite gran-ules, according to the manufacturer’s direc-tions.

• Havethewelltestedonceayearforcoli-form bacteria, nitrates, and other constitu-ents of concern.

• Keepaccuraterecordsofanywellmain-tenance, such as disinfection or sediment removal,thatmayrequiretheuseofchem-icals in the well.

• Hireacertifiedwelldrillerforanynewwellconstruction, modification, or abandon-ment and closure.

• Avoidmixingorusingpesticides,fertilizers,herbicides, degreasers, fuels, and other pollutants near the well.

• Donotdisposeofwastesindrywellsorinabandoned wells.

• Donotcutoffthewellcasingbelowtheland surface.

• Pumpandinspectsepticsystemsasoftenas recommended by your local health department.

• Neverdisposeofhazardousmaterialsinaseptic system.

192

20


Set A Regular Maintenance Schedule For Your Well And Your Septic System

Proper well and septic system construction and con-tinued maintenance are keys to the safety of your water supply. Your state water well and septic system contractor licensing agency, local health department, or local public water system professional can provide information on well construction. Make certain your contractors are licensed by the state, if required, or certified by the National Ground Water Association.

Maintain your well, fixing problems before they reach crisis levels, and keep up-to-date records of well installation and repairs, as well as plumbing and water costs. Protect your own well area from contamination.

Immediately Remedy Any Problems

If you find that your well water is con-taminated, fix the problem as soon as possible. Consider connecting into a nearby community water system, if one is available. You may want to install a water treatment device to remove impurities. Information on these devices is provided

on page 16. If you connect to a public water system, remember to close your well properly.

After A Flood-Concerns And Advisories

• Stayawayfromwellpumptoavoidelectricshock.

• Donotdrinkorwashfromafloodedwell.

• Pumpthewelluntilwaterrunsclear.

• Ifwaterdoesnotrunclear,contactthecountyorstate health department or extension service for advice.

Animal wastecan

contaminateyour

water supply

193

21


Drinking water protection is a shared responsibility. Many actions are underway to protect our nation’s drinking water, and there are many opportunities for citizens to become involved.

Be Involved!

EPA activities to protect drinking water include set-ting drinking water standards and overseeing the work of states that enforce federal standards—or stricter ones set by the individual state. EPA holds many public meetings on issues ranging from pro-posed drinking water standards to the development of databases. You can also comment on proposed drafts of other upcoming EPA documents. A list of public meetings and regulations open for comment can be found at www.epa.gov/safewater/pubinput/html.

Be Informed!

• ReadtheannualConsumerConfidenceReportprovided by your water supplier. Some Consumer Confidence Reports are available at www.epa.gov/safewater/dwinfo.htm.

• Useinformationfromyourstate’sSourceWaterAssessment to learn about potential threats to your water source.

• Ifyouareoneofthe15percentofAmericanswhouses a private source of drinking water—such as a well, cistern, or spring—find out what activi-ties are taking place in your watershed that may impact your drinking water; talk to local experts/test your water periodically; and maintain your well properly.

• FindoutiftheCleanWaterActstandardsforyourdrinking water source are intended to protect water for drinking, in addition to fishing and swimming.

Be Observant!

• Lookaroundyourwatershedandlookforannouncements in the local media about activities that may pollute your drinking water.

• Form and operate a citizens watch network with-in your community to communicate regularly with law enforcement, your public water supplier and wastewater operator. Communication is key to a safer community!

• Be alert. Get to know your water/wastewater utili-ties, their vehicles, routines and their personnel.

• Become aware of your surroundings. This will help you to recognize suspicious activity as opposed to normal daily activities.

Other Ways To Get Involved

• Attendpublichearingsonnewconstruc-tion, storm water permitting, and town planning.

• Keepyourpublicofficialsaccountablebyasking to see their environmental impact statements.

• Askquestionsaboutanyissuethatmayaffect your water source.

• Participatewithyourgovernmentandyourwater system as they make funding deci-sions.

• Volunteerorhelprecruitvolunteerstopar-ticipate in your community’s contaminant monitoring activities.

• Helpensurethatlocalutilitiesthatprotectyourwaterhaveadequateresourcestodotheir job.

8. What You Can Do To Protect Your Drinking Water

194

22


• Ifyouseeanysuspiciousactivitiesinoraroundyour water supply, please notify local authorities or call 9-1-1 immediately to report the incident.

Don’t Contaminate!

• Reducepavedareas:usepermeable surfaces that allow rain to soak through, not run off.

• Reduceoreliminatepesticideapplication: test your soil before applying chemicals, and use plants that require little or no water, pesti-cides, or fertilizers.

• Reducetheamountoftrashyou create: reuse and recycle.

• Recycleusedoil:1quartofoil can contaminate 2 million gallons

of drinking water—take your used oil and anti-freeze to a service station or recycling center.

• Takethebusinsteadofyourcaronedayaweek:you could prevent 33 pounds of carbon dioxide emissions each day.

• Keeppollutantsawayfromboatmarinasandwaterways: keep boat motors well-tuned to prevent leaks, select nontoxic cleaning products and use a drop cloth, and clean and maintain boats away from the water.

For more information on how you can help pro-tect your local drinking water source, call the Safe Drinking Water Hotline, or check www.epa.gov/safewater/publicoutreach. Additional resources are listed in Appendix C.

Stormwater runoff threatens our sources of drinking water. As this water washes over roofs, pavement, farms and grassy areas, it picks up fertilizers, pesticides and litter, and deposits them in surface water and ground water. Here are some other threats to our drinking water:

Every year:

• Weapply67millionpoundsofpesticidesthat contain toxic and harmful chemicals to our lawns.

• Weproducemorethan230milliontonsofmunicipal solid water—approximately five pounds of trash or garbage per person per day—that contain bacteria, nitrates, virus-es, synthetic detergents, and household chemicals.

• Ourmorethan12millionrecreationaland houseboats and 10,000 boat marinas release solvents, gasoline, detergents, and raw sewage directly into our rivers, lakes and streams.

195

23


Contaminant MCL or Potential health effects from Common sources of contaminant Public Health TT1 (mg/L)2 long-term3 exposure above the MCL in drinking water Goal (mg/L)2

Acrylamide TT4 Nervous system or blood problems; Added to water during sewage/ zero increased risk of cancer wastewater treatment

Alachlor 0.002 Eye, liver, kidney or spleen problems; Runoff from herbicide zero anemia; increased risk of cancer used on row crops Alpha/photon emitters 15 picocuries Increased risk of cancer Erosion of natural deposits of certain zero per Liter minerals that are radioactive and (pCi/L) may emit a form of radiation known as alpha radiation

Antimony 0.006 Increaseinbloodcholesterol;decrease Dischargefrompetroleumrefineries; 0.006 inbloodsugar fireretardants;ceramics;electronics; solder

Arsenic 0.010 Skin damage or problems with circulatory Erosion of natural deposits; runoff 0 systems, and may have increased from orchards; runoff from glass & risk of getting cancer electronics production wastes

Asbestos(fibers>10 7million Increasedriskofdevelopingbenign Decayofasbestoscementinwater 7MFL micrometers) fibersper intestinalpolyps mains;erosionofnaturaldeposits Liter (MFL)

Atrazine 0.003 Cardiovascular system or reproductive Runoff from herbicide used on row 0.003 problems crops

Barium 2 Increase in blood pressure Discharge of drilling wastes; discharge 2 frommetalrefineries;erosion of natural deposits

Benzene 0.005 Anemia; decrease in blood platelets; Discharge from factories; leaching zero increasedriskofcancer fromgasstoragetanksandlandfills

Benzo(a)pyrene 0.0002 Reproductivedifficulties;increasedrisk Leachingfromliningsofwaterstorage zero (PAHs) of cancer tanks and distribution lines

Beryllium 0.004 Intestinallesions Dischargefrommetalrefineriesand 0.004 coal-burning factories; discharge from electrical, aerospace, and defense industries

Beta photon emitters 4 millirems Increased risk of cancer Decay of natural and man-made zero per year deposits of certain minerals that are radioactive and may emit forms of radiation known as photons and beta radiation

Bromate 0.010 Increased risk of cancer Byproduct of drinking water disinfection zero

Cadmium 0.005 Kidney damage Corrosion of galvanized pipes; erosion 0.005 of natural deposits; discharge frommetalrefineries;runofffrom waste batteries and paints

Carbofuran 0.04 Problems with blood, nervous system, or Leaching of soil fumigant used on rice 0.04 reproductive system and alfalfa

Carbon tetrachloride 0.005 Liver problems; increased risk of cancer Discharge from chemical plants and zero other industrial activities

Chloramines (as Cl2) MRDL=4.01 Eye/nose irritation; stomach discomfort; Water additive used to control MRDLG=41 anemia microbes

Chlordane 0.002 Liver or nervous system problems; Residue of banned termiticide zero increased risk of cancer

Chlorine (as Cl2) MRDL=4.01 Eye/nose irritation; stomach discomfort Water additive used to control MRDLG=41 microbes

Chlorine dioxide MRDL=0.81 Anemia; infants, young children, and fetuses of Water additive used to control MRDLG=0.81 (as ClO2) pregnant women: nervous system effects microbes

Chlorite 1.0 Anemia; infants, young children, and fetuses of Byproduct of drinking water 0.8 pregnant women: nervous system effects disinfection

Chlorobenzene 0.1 Liver or kidney problems Discharge from chemical and agricultural 0.1 chemical factories

Chromium (total) 0.1 Allergic dermatitis Discharge from steel and pulp mills; 0.1 erosion of natural deposits

Copper TT5; Short-term exposure: Gastrointestinal Corrosion of household plumbing 1.3 Action distress. Long-term exposure: Liver or systems; erosion of natural deposits Level = kidney damage. People with Wilson’s 1.3 Disease should consult their personal doctor if the amount of copper in their water exceeds the action level

Cryptosporidium TT7 Short-term exposure: Gastrointestinal illness Human and animal fecal waste zero (e.g., diarrhea, vomiting, cramps)

National Primary Drinking Water Regulations

OC

OC

OC

OC

OC

OC

OC

OC

OC

R

R

D

D

D

IOC

IOC

IOC

IOC

IOC

IOC

IOC

IOC

M

DBP

DBP

LEGEND

D IOC OCDisinfectant Inorganic Chemical Organic Chemical RMDBP Disinfection Byproduct Microorganism Radionuclides

196

24



Cyanide 0.2 Nerve damage or thyroid problems Discharge from steel/metal factories; 0.2 (as free cyanide) discharge from plastic and fertilizer factories

2,4-D 0.07 Kidney, liver, or adrenal gland problems Runoff from herbicide used on row 0.07 crops

Dalapon 0.2 Minor kidney changes Runoff from herbicide used on rights 0.2 of way

1,2-Dibromo-3- 0.0002 Reproductivedifficulties;increasedrisk Runoff/leachingfromsoilfumigant zero chloropropane of cancer used on soybeans, cotton, pineapples, (DBCP) and orchards

o-Dichlorobenzene 0.6 Liver, kidney, or circulatory system Discharge from industrial chemical 0.6 problems factories

p-Dichlorobenzene 0.075 Anemia; liver, kidney or spleen damage; Discharge from industrial chemical 0.075 changes in blood factories

1,2-Dichloroethane 0.005 Increased risk of cancer Discharge from industrial chemical zero factories

1,1-Dichloroethylene 0.007 Liver problems Discharge from industrial chemical 0.007 factories

cis-1,2-Dichloroethylene 0.07 Liver problems Discharge from industrial chemical 0.07 factories

trans-1,2- 0.1 Liver problems Discharge from industrial chemical 0.1 Dichloroethylene factories

Dichloromethane 0.005 Liver problems; increased risk of cancer Discharge from drug and chemical zero factories

1,2-Dichloropropane 0.005 Increased risk of cancer Discharge from industrial chemical zero factories

Di(2-ethylhexyl) adipate 0.4 Weight loss, liver problems, or possible Discharge from chemical factories 0.4 reproductivedifficulties

Di(2-ethylhexyl) 0.006 Reproductivedifficulties;liverproblems; Dischargefromrubberandchemical zero phthalate increased risk of cancer factories

Dinoseb 0.007 Reproductivedifficulties Runofffromherbicideusedonsoybeans 0.007 and vegetables Dioxin(2,3,7,8-TCDD) 0.00000003 Reproductivedifficulties;increasedrisk Emissionsfromwasteincineration zero of cancer and other combustion; discharge from chemical factories

Diquat 0.02 Cataracts Runoff from herbicide use 0.02

Endothall 0.1 Stomach and intestinal problems Runoff from herbicide use 0.1

Endrin 0.002 Liver problems Residue of banned insecticide 0.002

Epichlorohydrin TT4 Increased cancer risk; stomach problems Discharge from industrial chemical zero factories; an impurity of some water treatment chemicals

Ethylbenzene 0.7 Liverorkidneyproblems Dischargefrompetroleumrefineries 0.7

Ethylenedibromide 0.00005 Problemswithliver,stomach,reproductive Dischargefrompetroleumrefineries zero system, or kidneys; increased risk of cancer Fecal coliform and MCL6 Fecal coliforms and E. coli are bacteria whose Human and animal fecal waste zero6 E. coli presence indicates that the water may be contaminated with human or animal wastes. Microbes in these wastes may cause short term effects, such as diarrhea, cramps, nausea, headaches, or other symptoms. They may pose a special health risk for infants, young children, and people with severely compromised immune systems.

Fluoride 4.0 Bone disease (pain and tenderness of Water additive which promotes 4.0 the bones); children may get mottled strong teeth; erosion of natural teeth deposits; discharge from fertilizer and aluminum factories

Giardia lamblia TT7 Short-term exposure: Gastrointestinal illness Human and animal fecal waste zero (e.g., diarrhea, vomiting, cramps)

Glyphosate 0.7 Kidney problems; reproductive Runoff from herbicide use 0.7 difficulties

Haloacetic acids 0.060 Increased risk of cancer Byproduct of drinking water n/a9 (HAA5) disinfection

Heptachlor 0.0004 Liver damage; increased risk of cancer Residue of banned termiticide zero

Heptachlor epoxide 0.0002 Liver damage; increased risk of cancer Breakdown of heptachlor zero

Heterotrophic plate TT7 HPC has no health effects; it is an HPC measures a range of bacteria n/a count (HPC) analytic method used to measure the that are naturally present in the variety of bacteria that are common in environment water. The lower the concentration of bacteria in drinking water, the better maintained the water system is.

OC

OC

OC

OC

OC

OC

OC

OC

OC

OC

OC

OC

OC

OC

OC

OCOCOCOC

OC

IOC

LEGEND


M

IOC

OC

M

OC

OCOC

DBP

M

197

25


LEGEND



Hexachlorobenzene 0.001 Liverorkidneyproblems;reproductive Dischargefrommetalrefineriesand zero difficulties;increasedriskofcancer agriculturalchemicalfactories

Hexachlorocyclopentadiene 0.05 Kidney or stomach problems Discharge from chemical factories 0.05 Lead TT5; Infants and children: Delays in physical or Corrosion of household plumbing zero Action or mental development; children could systems; erosion of natural deposits Level=0.015 showslightdeficitsinattentionspan and learning abilities; Adults: Kidney problems; high blood pressure

Legionella TT7 Legionnaire’s Disease, a type of Found naturally in water; multiplies in zero pneumonia heating systems

Lindane 0.0002 Liver or kidney problems Runoff/leaching from insecticide used 0.0002 on cattle, lumber, gardens

Mercury (inorganic) 0.002 Kidney damage Erosion of natural deposits; discharge 0.002 fromrefineriesandfactories; runofffromlandfillsandcroplands

Methoxychlor 0.04 Reproductivedifficulties Runoff/leachingfrominsecticideused 0.04 on fruits, vegetables, alfalfa, livestock

Nitrate (measured as 10 Infants below the age of six months who Runoff from fertilizer use; leaching 10 Nitrogen) drink water containing nitrate in excess from septic tanks, sewage; erosion of of the MCL could become seriously ill natural deposits and, if untreated, may die. Symptoms include shortness of breath and blue-baby syndrome.

Nitrite (measured as 1 Infants below the age of six months who Runoff from fertilizer use; leaching 1 Nitrogen) drink water containing nitrite in excess from septic tanks, sewage; erosion of of the MCL could become seriously ill natural deposits and, if untreated, may die. Symptoms include shortness of breath and blue-baby syndrome.

Oxamyl (Vydate) 0.2 Slight nervous system effects Runoff/leaching from insecticide used 0.2 on apples, potatoes, and tomatoes

Pentachlorophenol 0.001 Liver or kidney problems; increased Discharge from wood-preserving zero cancer risk factories

Picloram 0.5 Liver problems Herbicide runoff 0.5

Polychlorinatedbiphenyls 0.0005 Skinchanges;thymusglandproblems; Runofffromlandfills;dischargeof zero (PCBs) immunedeficiencies;reproductiveor wastechemicals nervoussystemdifficulties;increased risk of cancer

Radium 226 and 5 pCi/L Increased risk of cancer Erosion of natural deposits zero Radium 228 (combined)

Selenium 0.05 Hairorfingernailloss;numbnessinfingers Dischargefrompetroleumandmetalrefineries; 0.05 or toes; circulatory problems erosion of natural deposits; discharge from mines Simazine 0.004 Problems with blood Herbicide runoff 0.004

Styrene 0.1 Liver, kidney, or circulatory system problems Discharge from rubber and plastic 0.1 factories;leachingfromlandfills

Tetrachloroethylene 0.005 Liver problems; increased risk of cancer Discharge from factories and dry cleaners zero

Thallium 0.002 Hair loss; changes in blood; kidney, intestine, Leaching from ore-processing sites; 0.0005 or liver problems discharge from electronics, glass, and drug factories

Toluene 1 Nervous system, kidney, or liver problems Discharge from petroleum factories 1

Total Coliforms 5.0 Coliforms are bacteria that indicate that other, Naturally present in the environment zero percent8 potentially harmful bacteria may be present. See fecal coliforms and E. coli Total Trihalomethanes 0.080 Liver, kidney or central nervous system problems; Byproduct of drinking water disinfection n/a9 (TTHMs) increased risk of cancer

Toxaphene 0.003 Kidney, liver, or thyroid problems; Runoff/leaching from insecticide used zero increased risk of cancer on cotton and cattle

2,4,5-TP (Silvex) 0.05 Liver problems Residue of banned herbicide 0.05

1,2,4-Trichlorobenzene 0.07 Changesinadrenalglands Dischargefromtextilefinishing 0.07 factories

1,1,1-Trichloroethane 0.2 Liver, nervous system, or circulatory Discharge from metal degreasing 0.2 problems sites and other factories

1,1,2-Trichloroethane 0.005 Liver, kidney, or immune system Discharge from industrial chemical 0.003 problems factories

Trichloroethylene 0.005 Liver problems; increased risk of cancer Discharge from metal degreasing zero sites and other factories

OC

OC

OC

OC

OC

OC

OCOC

OC

OC

OC

OC

OCOC

OC

OC

OC

OC

R

IOC

IOC

IOC

IOC

IOC

IOC

DBP

M

M

198

26


M

LEGEND



Turbidity TT7 Turbidity is a measure of the cloudiness of water. Soil runoff n/a Itisusedtoindicatewaterqualityandfiltration effectiveness (e.g., whether disease-causing organisms are present). Higher turbidity levels are often associated with higher levels of disease-causing microorganisms such as viruses, parasites and some bacteria. These organisms can cause short term symptoms such as nausea, cramps, diarrhea, and associated headaches.

Uranium 30µg/L Increased risk of cancer, kidney toxicity Erosion of natural deposits zero Vinyl chloride 0.002 Increased risk of cancer Leaching from PVC pipes; discharge zero from plastic factories

Viruses (enteric) TT7 Short-term exposure: Gastrointestinal illness Human and animal fecal waste zero (e.g., diarrhea, vomiting, cramps)

Xylenes (total) 10 Nervous system damage Discharge from petroleum factories; 10 discharge from chemical factories

OC

OC

R

M

199

27


NOTES1 Definitions • Maximum Contaminant Level Goal (MCLG)—The level of a contaminant in drinking water below which there is no known or expected risk to health. MCLGs allow for a margin of safety and are non-enforceable public health goals. • MaximumContaminantLevel(MCL)—Thehighestlevelofacontaminantthatisallowedin drinking water. MCLs are set as close to MCLGs as feasible using the best available treatment technology and taking cost into consideration. MCLs are enforceable standards. • Maximum Residual Disinfectant Level Goal (MRDLG)—The level of a drinking water disinfectant below which there is no known or expected risk to health. MRDLGs do not reflect the benefits of the use of disinfectants to control microbial contaminants. • MaximumResidualDisinfectantLevel(MRDL)—Thehighestlevelofadisinfectantallowedin drinking water. There is convincing evidence that addition of a disinfectant is necessary for control of microbial contaminants. • Treatment Technique (TT)—A required process intended to reduce the level of a contaminant in drinking water.2 Units are in milligrams per liter (mg/L) unless otherwise noted. Milligrams per liter are equivalent to parts per million (ppm).3 Health effects are from long-term exposure unless specified as short-term exposure.4 Each water system must certify annually, in writing, to the state (using third-party or manufacturers certification) that when it uses acrylamide and/or epichlorohydrin to treat water, the combination (or product) of dose and monomer level does not exceed the levels specified, as follows: Acrylamide = 0.05 percent dosed at 1 mg/L (or equivalent); Epichlorohydrin = 0.01 percent dosed at 20 mg/L (or equivalent).5 Lead and copper are regulated by a Treatment Technique that requires systems to control the corrosiveness of their water. If more than 10 percent of tap water samples exceed the action level, water systems must take additional steps. For copper, the action level is 1.3 mg/L, and for lead is 0.015 mg/L.6 A routine sample that is fecal coliform-positive or E. coli-positive triggers repeat samples--if any repeat sample is total coliform-positive, the system has an acute MCL violation. A routine sample that is total coliform-positive and fecal coliform-negative or E. coli-negative triggers repeat samples--if any repeat sample is fecal coliform-positive or E. coli-positive, the system has an acute MCL violation. See also Total Coliforms.7 EPA’s surface water treatment rules require systems using surface water or ground water under the direct influence of surface water to (1) disinfect their water, and (2) filter their water or meet criteria for avoiding filtration so that the following contaminants are controlled at the following levels: • Cryptosporidium: 99 percent removal for systems that filter. Unfiltered systems are required to include Cryptosporidium in their existing watershed control provisions. • Giardialamblia:99.9percentremoval/inactivation

• Viruses:99.99percentremoval/inactivation • Legionella: No limit, but EPA believes that if Giardia and viruses are removed/inactivated according to the treatment techniques in the surface water treatment rule, Legionella will also be controlled. • Turbidity: For systems that use conventional or direct filtration, at no time can turbidity (cloudiness of water) go higher than 1 nephelolometric turbidity unit (NTU), and samples for turbidity must be less than or equal to 0.3 NTU in at least 95 percent of the samples in any month. Systems that use filtration other than conventional or direct filtration must follow state limits, which must include turbidity at no time exceeding 5 NTU. • HPC:Nomorethan500bacterialcoloniespermilliliter • Long Term 1 Enhanced Surface Water Treatment; Surface water systems or ground water systems under the direct influence of surface water serving fewer than 10,000 people must comply with the applicable Long Term 1 Enhanced Surface Water Treatment Rule provisions (e.g. turbidity standards, individual filter monitoring, Cryptosporidium removal requirements, updated watershed control requirements for unfiltered systems). • LongTerm2EnhancedSurfaceWaterTreatment;Thisruleappliestoallsurfacewatersystems or ground water systems under the direct influence of surface water. The rule targets additional Cryptosporidium treatment requirements for higher risk systems and includes provisions to reduce risks from uncovered finished water storages facilities and to ensure that the systems maintain microbial protection as they take steps to reduce the formation of disinfection byproducts. (Monitoring start dates are staggered by system size. The largest systems (serving at least 100,000 people) will begin monitoring in October 2006 and the smallest systems (serving fewer than 10,000 people) will not begin monitoring until October 2008. After completing monitoring and determining their treatment bin, systems generally have three years to comply with any additional treatment requirements.) • FilterBackwashRecycling:TheFilterBackwashRecyclingRulerequiressystemsthatrecycleto return specific recycle flows through all processes of the system’s existing conventional or direct filtration system or at an alternate location approved by the state.8 No more than 5.0 percent samples total coliform-positive in a month. (For water systems that collect fewer than 40 routine samples per month, no more than one sample can be total coliform-positive per month.) Every sample that has total coliform must be analyzed for either fecal coliforms or E. coli. If two consecutive TC-positive samples, and one is also positive for E. coli or fecal coliforms, system has an acute MCL violation.9 Although there is no collective MCLG for this contaminant group, there are individual MCLGs for some of the individual contaminants: • Haloaceticacids:dichloroaceticacid(zero);trichloroaceticacid(0.3mg/L) • Trihalomethanes: bromodichloromethane (zero); bromoform (zero); dibromochloromethane (0.06 mg/L)

200

28


US EPA Publications25 Years of the Safe Drinking Water Act: History & TrendsEPA 816-R-99-007

Community Water Systems Survey 2000, Volume IEPA 815-R-02-0054

Drinking Water Costs and Federal FundingEPA 810-F-99-014

Drinking Water from Household WellsEPA 816-K-02-003

Drinking Water Priority Rulemaking: Microbial and Disinfection Byproduct RulesEPA 816-F-01-012

Drinking Water TreatmentEPA 810-F-99-013

Factoids: Drinking Waterand Ground Water Statistics for 2001EPA 815-K-02-004

Factoids: Drinking Water and Ground Water Statistics for 2002EPA 816–K-03-001

Fact Sheet: 1999 Drinking Water Infrastructure Needs SurveyEPA 816-F-01-001

“Investing in America’s Water Infrastructure” Keynote Address by G. Tracy Mehan III to the Schwab Capital Markets’ Global Water ConferenceProtect Your Drinking WaterEPA 816-F-02-012

Public Access to Information & Public InvolvementEPA 810-F-99-021

Report to Congress: EPA Studies on Sensitive Subpopulations and Drinking Water ContaminantsEPA 815-R-00-015Safe Drinking Water Act-Protecting America’s Public HealthEPA 816-H-02-003

Safe Drinking Water Act: Underground Injection Control Program: Protecting Public Health and Drinking Water Resources EPA 816-H-01-003

The Clean Water and Drinking Water Infrastructure Gap AnalysisEPA 816-F-02-017

The Drinking Water State Revolving Fund: Protecting the Public Through Drinking Water Infrastructure ImprovementsEPA 819-F-00-028

Understanding the Safe Drinking Water ActEPA 810-F-99-008

Using Water Wisely in the HomeEPA 800-F-02-001 Featured Consumer Information ResourcesDownload the following documents from EPA’s New Drinking Water Consumer Information Web site: http://www.epa.gov/safewater/con-sumerinformation/

Or order hard copies from EPA’s National Service Center for Environmental Publications: HYPERLINK “http://www.epa.gov/nscep” http://www.epa.gov/nscep or 1-800-490-9198

Public Health and Emergency Information:

Bottled Water Basics, 816-K-05-003

Filtration Facts, 816-K-05-002

Emergency Disinfection ofDrinking WaterEnglish, 816-F-06-027Spanish, EPA 816-F-06-028French, 816-F-06-045Arabic, 816-F-06-030Vietnamese, 816-F-06-029

What to Do After the FloodEnglish, 816-F-05-021Spanish, 816-F-05-021Vietnamese, 816-F-05-025

Is There Lead In My Drinking Water? 816-F-05-001

Guidance for People with Severely Weakened Immune Systems,816-F-99-005

Public Involvement in Water Security Web site, a compilation of resources to help increase public awareness of water security issues and to give citizens information and guidance to help them prepare for potential emergency incidents and incorporate security activities into their daily lives, http://cfpub.epa.gov/safewater/water-security/publicInvolve.cfm

Environmental Education:

Thirstin’s Drinking Water Games and Activities (CD-ROM), 816-C-04-008

Virtual Tour of a Water Treatment Plant (CD-ROM), 816-C-06-002

Find answers to your questions about drinking water and ground water programs authorized under the Safe Drinking Water Act in EPA’s dynamic question and answer database, http://www.epa.gov/safewater/drin-klink.html.

Publications From Outside SourcesCenters for Disease Control and Prevention. Morbidity and Mortality Weekly Report: Surveillance for Waterborne-Disease Outbreaks-United States-1999-2000.

Congressional Budget Office. Future Investment in Drinking Water & Wastewater Infrastructure

Appendix B: References

201

29


American Water Works AssociationPublic Affairs Department6666 West Quincy AvenueDenver, CO 80235Phone (303) 794-7711www.awwa.org

Association of Metropolitan Water Agencies1620 I Street NWSuite 500Washington, DC 20006Phone (202) 331-2820Fax (202) 785-1845www.amwa.net

Association of State Drinking Water Administrators1401 Wilson Blvd.Suite 1225Arlington, VA 22209Phone (703) 812-9505www.asdwa.org

Clean Water Action4455 Connecticut Avenue NW Suite A300Washington, DC 20008Phone (202) 895-0420www.cleanwater.org

Consumer Federation of America1620 I Street NWSuite 200Washington, DC 20006Phone (202) 387-6121www.consumerfed.org

The Groundwater FoundationP.O. Box 22558Lincoln, NE 68542Phone (800) 858-4844www.groundwater.org

The Ground Water Protection Council13308 N. Mac ArthurOklahoma City, OK 73142Phone (405) 516-4972www.gwpc.org

International Bottled Water Association 1700 Diagonal RoadSuite 650 Alexandria, VA 22314 Phone (703) 683-5213 Information Hotline 1-800-WATER-11 [email protected]

National Association of Regulatory Utility Commissioners1101 Vermont Ave NWSuite 200Washington, DC 20005Phone (202) 898-2200www.naruc.org

National Association of Water Companies2001 L Street NW Suite 850Washington, DC 20036Phone (202) 833-8383www.nawc.org

National Drinking Water ClearinghouseWest Virginia UniversityP.O. Box 6064Morgantown, WV 26506Phone (800) 624-8301www.ndwc.wvu.edu

National Ground Water Association601 Dempsey RdWesterville, OH 43081-8978Phone: (800) 551-7379www.ngwa.org

National Rural Water Association2915 South 13th StreetDuncan, OK 73533Phone (580) 252-0629www.nrwa.org

Natural Resources Defense Council40 West 20th StreetNew York, NY 10011Phone (212) 727-2700www.nrdc.org

Appendix C: Sources of Additional Information

202

30


NSF InternationalP.O. Box 130140789 North Dixboro RoadAnn Arbor, MI 48113Phone (800) NSF-MARKwww.nsf.org

Rural Community Assistance Program1522 K Street NWSuite 400Washington, DC 20005Phone (800) 321-7227www.rcap.org

Underwriters LaboratoriesCorporate Headquarters2600 N.W. Lake RoadCamas, WA 98607Phone (877) 854-3577www.ul.com

Water Quality Association4151 Naperville RoadLisle, IL 60532Phone (630) 505-0160www.wqa.org

U.S. Environmental Protection Agency Water Resource Center1200 Pennsylvania Avenue NWRC-4100TWashington, DC 20460SDWA Hotline (800) 426-4791www.epa.gov/safewater

Water Systems CouncilNational Programs Office101 30th Street NWSuite 500Washington, D.C. 20007Phone: (202) 625-4387Wellcare Hotline 888-395-1033www.watersystems council.org

EPA Region 1 (CT, ME, MA, NH, RI, VT)Phone (888) 372-7341Phone (617) 918-1614

EPA Region 2 (NJ, NY, PR, VI)Phone (212) 637-3000

EPA Region 3(DE, DC, MD, PA, VA, WV)Phone (215) 814-5000

EPA Region 4(AL, FL, GA, KY, MS, NC, SC, TN)Phone (404) 562-9900

EPA Region 5(IL, IN, MI, MN, OH, WI)Phone (312) 353-2000

EPA Region 6(AR, LA, NM, OK, TX)Phone (214) 665-2200

EPA Region 7(IA, KS, MO, NE)Phone (913) 551-7003

EPA Region 8(CO, MT, ND, SD, UT, WY)Phone (303) 312-6312

EPA Region 9(AZ, CA, HI, NW, AS GU)Phone (415) 947-8000

EPA Region 10(AK, ID, OR, WA)Phone (206) 553-1200

203

31


Action Level

The level of lead and copper which, if exceeded, triggerstreatmentorotherrequirementsthatawater system must follow.

Aquifer

A natural underground layer, often of sand or gravel, that contains water

Coliform

A group of related bacteria whose presence in drinking water may indicate contamination by disease-causing microorganisms

Community Water System (CWS)

A water system that supplies drinking water to 25 people or more year-round in their residences

Contaminant

Anything found in water (including microorgan-isms, radionuclides, chemicals, minerals, etc.) which may be harmful to human health

Cryptosporidium

Microorganism found commonly in lakes and rivers which is highly resistant to disinfection.

Disinfectant

A chemical (commonly chlorine, chloramines, or ozone) or physical process (e.g., ultraviolet light) that kills microorganisms such as viruses, bacteria, and protozoa

Distribution System

A network of pipes leading from a treatment plant to customers’ plumbing systems

Ground Water

Waterthatispumpedandtreatedfromanaquifer

Inorganic Contaminants

Mineral-based compounds such as metals, nitrates, and asbestos; naturally occurring in some water, but can also enter water through human activities

Maximum Contaminant Level

The highest level of a contaminant that EPA allows in drinking water (legally enforceable standard)

Maximum Contaminant Level Goal

The level of a contaminant at which there would be no risk to human health (not a legally enforceable standard)

Microorganisms

Tiny living organisms that can be seen only under a microscope; some can cause acute health prob-lems when consumed in drinking water

Non-Transient Non-Community Water System

A non-community water system that serves the same people more than six months of the year, but not year-round

Organic Contaminants

Carbon-based chemicals, such as solvents and pes-ticides, which enter water through cropland runoff or discharge from factories

Pathogen

Disease-causing organism

Appendix D: Glossary

204

32


Public Water System (PWS)

A water system which supplies drinking water to at least 25 people, at least 60 days each year

Sensitive Subpopulation

People who may be more vulnerable to drinking water contamination, such as infants, children, some elderly, and people with severely compro-mised immune systems

Septic System

Used to treat sanitary waste; can be a significant threattowaterqualityduetoleaksorrunoff

Source Water

Water in its natural state, prior to any treatment for drinking (i.e., lakes, streams, ground water)

Surface Water

Water that is pumped and treated from sources open to the atmosphere, such as rivers, lakes, and reservoirs

Transient Non-Community Water System

A non-community water system that serves the public but not the same individuals for more than six months

Violation

Failure to meet any state or federal drinking water regulation

Vulnerability Assessment

Anevaluationofdrinkingwatersourcequalityandits vulnerability to contamination by pathogens and toxic chemicals

Watershed

The land area from which water drains into a stream, river, or reservoir

Well

A bored, drilled or driven shaft whose depth is greater than the largest surface dimension, a dug hole whose depth is greater than the largest surface dimension, an improved sinkhole, or a sub-surface fluid distribution system

205

34


207

208

07/24/2012 http://water.epa.gov/drink/info/well/basicinformation.cfm

Dug Wells Dug wells are holes in the ground dug by shovel or backhoe. Historically, a dug well was excavated below the groundwater table until incoming water exceeded the digger’s bailing rate. The well was then lined (cased) with stones, brick, tile, or other material to prevent collapse. It was covered with a cap of wood, stone, or concrete. Since it is so difficult to dig beneath the ground water table, dug wells are not very deep. Typically, they are only 10 to 30 feet deep. Being so shallow, dug wells have the highest risk of becoming contaminated. To minimize the likelihood of contamination, your dug well should have certain features. These features help to prevent contaminants from traveling along the outside of the casing or through the casing and into the well.

Dug Well Construction Features

• The well should be cased with a watertight material (for example, tongue-and-groove precast concrete) and a cement grout or bentonite clay sealant poured along the outside of the casing to the top of the well.

• The well should be covered by a concrete curb and cap that stands about a foot above the ground.

• The land surface around the well should be mounded so that surface water runs away from the well and is not allowed to pond around the outside of the wellhead.

• Ideally, the pump for your well should be inside your home or in a separate pump house, rather than in a pit next to the well.

Land activities around a dug well can also contaminate it. (see our chart of activites that may contaminate a drinking water well)

While dug wells have been used as a household water supply source for many years, most are “relics” of older homes, dug before drilling equipment was readily available or when drilling was considered too expensive. If you have a dug well on your property and are using it for drinking water, check to make sure it is properly covered and sealed. Another problem relating to the shallowness of a dug well is that it may go dry during a drought when the ground water table drops.

Other types of wells:

• Driven • Drilled

The information contained on this page, as well as the above graphic was provided by The Rhode Island Department of Environmental Management from their document: Health Drinking Water for Rhode Islanders: Private Drinking Water Wells (644KB PDF FILE, 4 pgs) (ALL ABOUT PDF FILES)

209

07/24/2012

Driven Wells Like dug wells, driven wells pull water from the water-saturated zone above the bedrock. Driven wells can be deeper than dug wells. They are typically 30 to 50 feet deep and are usually located in areas with thick sand and gravel deposits where the ground water table is within 15 feet of the ground’s surface. In the proper geologic setting, driven wells can be easy and relatively inexpensive to install. Although deeper than dug wells, driven wells are still relatively shallow and have a moderate-to-high risk of contamination from nearby land activities.

• See our chart of activities that may contaminate a drinking water well.

Driven Well Construction Features

• Assembled lengths of two inches to three inches diameter metal pipes are driven into the ground. A screened “well point” located at the end of the pipe helps drive the pipe through the sand and gravel. The screen allows water to enter the well and filters out sediment.

• The pump for the well is in one of two places: on top of the well or in the house. An access pit is usually dug around the well down to the frost line and a water discharge pipe to the house is joined to the well pipe with a fitting.

• The well and pit are capped with the same kind of large-diameter concrete tile used for a dug well. The access pit may be cased with pre-cast concrete.

To minimize this risk, the well cover should be a tight-fitting concrete curb and cap with no cracks and should sit about a foot above the ground. Slope the ground away from the well so that surface water will not pond around the well. If there’s a pit above the well, either to hold the pump or to access the fitting, you may also be able to pour a grout sealant along the outside of the well pipe. Protecting the water quality requires that you maintain proper well construction and monitor your activities around the well. It is also important to follow the same land use precautions around the driven well as described under dug wells.


• Drilled • Dug


210

Drilled Wells Drilled wells penetrate about 100-400 feet into the bedrock. Where you find bedrock at the surface, it is commonly called ledge. To serve as a water supply, a drilled well must intersect bedrock fractures containing ground water.

Drilled Well Construction Features

• The casing is usually metal or plastic pipe, six inches in diameter that extends into the bedrock to prevent shallow ground water from entering the well. By law, the casing has to extend at least 18 feet into the ground, with at least five feet extending into the bedrock. The casing should also extend a foot or two above the ground’s surface. A sealant, such as cement grout or bentonite clay, should be poured along the outside of the casing to the top of the well. The well is capped to prevent surface water from entering the well.

• Submersible pumps, located near the bottom of the well, are most commonly used in drilled wells. Wells with a shallow water table may feature a jet pump located inside the home. Pumps require special wiring and electrical service. Well pumps should be installed and serviced by a qualified professional registered with your state.

• Most modern drilled wells incorporate a pitless adapter designed to provide a sanitary seal at the point where the discharge water line leaves the well to enter your home. The device attaches directly to the casing below the frost line and provides a watertight subsurface connection, protecting the well from frost and contamination.

• Older drilled wells may lack some of these sanitary features. The well pipe used was often eight-, 10- or 12- inches in diameter, and covered with a concrete well cap either at or below the ground’s surface. This outmoded type of construction does not provide the same degree of protection from surface contamination. Also, older wells may not have a pitless adapter to provide a seal at the point of discharge from the well.

Hydrofracting A Drilled Well

Hydrofracting is a process that applies water or air under pressure into your well to open up existing fractures near your well and can even create new ones. Often this can increase the yield of your well. This process can be applied to new wells with insufficient yield and to improve the quantity of older wells.


• Driven • Dug


211

07/24/2012

7/20/12 Private Wells: Frequently Asked Questions | Water, Wastewater & Wetlands | MassDEP

1/2www.mass.gov/dep/water/drinking/pwfaq.htm

Private Wells: Frequently Asked Questions

What is a private water supply [private well]? #whatWho regulates private wells? #whoregWho can drill a well? #whodrillWhere can I find information about my well (well completion report(s))? #infoWhen should my well water be tested? #whentestWhat should the water be tested for? #whattestWhere can the water get tested? #wheretestWho pays for water testing? #payWhat can contaminate a well? #contam

What is a private water supply [private well]?

A private water supply provides water for human consumption and consists of a system that has less than fifteen service connections

and either (1) serves less than twenty-five individuals or (2) serves an average of twenty-five or more individuals daily for less than

sixty days of the year. The term "private well" is typically used for a well that provides drinking water for a single family residence.

Who regulates private wells?

Under Massachusetts General Law, (MGL Ch.111 s.122) local Boards of Health (BOHs) have primary jurisdiction over the regulation of

private wells. The local BOH is empowered to adopt a Private Well Regulation that establishes criteria for private well siting,

construction, water quality and quantity.

Who can drill a well?

As required by 313 CMR 3.00, only Massachusetts Registered Well Drillers are permitted to install wells in the Commonwealth. This

includes all well construction types, for both potable and non-potable purposes.

Where can I find information about my well (well completion report(s))?

Upon installation of a well, a well driller is required to submit copies of the Well Completion Report to the local BOH and the MassDEP

Well Driller Program. By contacting either office, you should be able to get a copy of your Well Completion Report, which contains

well construction details and geologic descriptions.

When should my well water be tested?

MassDEP recommends that prospective homebuyers test the water in a home with a private well before purchase. Once you've

purchased the home, the interval between water quality tests can generally be in terms of years if the well is properly constructed and

located in a safe area. However, the following conditions would prompt more frequent testing:

Heavily developed areas with land uses that handle hazardous chemicals.

Recent well construction activities or repairs. MassDEP recommends taking a bacterial test after any well repair or pump or

plumbing modification, but only after disinfection and substantial flushing of the water system.

Contaminant concentrations above state or federal standards found in earlier testing.

Noticeable variations in quality like a water quality change after a heavy rain, extended drought, or an unexplained change in a

previously trouble-free well (i.e. funny taste, cloudy appearance, etc.).

When taking any sample, MassDEP recommends that it be taken after a heavy rainstorm. These events tend to highlight conditions of

improper well construction or poor soil filtration.

What should the water be tested for?

First contact your Board of Health to see if there are any specific water quality tests required by the local Private Well Regulation.

MassDEP recommends that the well owner test for, at a minimum, the parameters listed in the EPA pamphlet "Protect Your Family: 212

7/20/12 Private Wells: Frequently Asked Questions | Water, Wastewater & Wetlands | MassDEP

2/2www.mass.gov/dep/water/drinking/pwfaq.htm

MassDEP recommends that the well owner test for, at a minimum, the parameters listed in the EPA pamphlet "Protect Your Family:

Test Your Well's Water Quality Today - A Guide to Water Quality Testing for Private Wells in Massachusetts

/dep/water/drinking/mapwell2.htm ." You should test initially for all contaminants of concern, and then at a minimum of once every ten

years (except for bacteria and nitrate/nitrite which should be sampled yearly), or as otherwise required by the local Board of Health.

Where can the water get tested?

MassDEP recommends the use of a state certified analytical laboratory for all water quality testing. Local Private Well Regulations

may specify the use of a state certified lab. A searchable list of MassDEP certified labs can be found at:

http://public.dep.state.ma.us/Labcert/Labcert.aspx http://public.dep.state.ma.us/Labcert/Labcert.aspx .

Who pays for water testing?

The private well owner is responsible for the costs of the water quality analyses. As testing fees may vary between certified labs, it

may be worthwhile to compare costs between labs.

What can contaminate a well?

Some contaminants are naturally occurring from features found in the rocks and soils of Massachusetts. These include substances

like bacteria, radon, arsenic, uranium, and other minerals.

Other contaminants find their way onto the land from human activities. On a large scale, industrial/commercial activities, improper

waste disposal, manure storage, road salting, and fuel spills can introduce hazardous substances to the ground. Typical residential

activities, such as the application of fertilizers and pesticides, fueling of lawn equipment, and disposal of household chemicals can

contaminate the ground when done improperly. Even an on-site residential septic system can pose a threat to your well.

213

Consumer guides for clients updated 5 28

Documents

Transcript of Consumer guides for clients updated 5 28