One Step Closer to a Simpler Real Estate Closing Process
By Meghan O'Meara
The confusion of buying a home can be a universal feeling. Oftentimes closing requires many documents, signatures, and approvals, which can make the home-buying process feel overwhelming. While requirements concerning title commitments, mortgages, title opinions etc., will continue, on April 21, 2022, Governor Reynolds signed House File 2343 (HF 2343), which has removed the requirement to include a separate Groundwater Hazard Statement when filing closing documents with the Recorder’s Office.
A Groundwater Hazard Statement is one of three documents typically required to be filed with the Recorder’s Office in an arms-length transaction, along with a deed and a declaration of value. The Groundwater Hazard Statement particularly addresses environmental issues on a property by requiring transferors to disclose the presence of (1) burial sites; (2) wells; (3) solid waste disposal sites; (4) underground storage tanks; (5) hazardous waste; and (6) private sewage.
With the signing of House File 2343, which became effective on July 1, 2022, if conditions 1-6 described above do not exist on the property, a separate Groundwater Hazard Statement does not need to be filed with the closing documents. Instead, the Iowa DNR and the Recorder’s Office will require the following additional warranty language be added to the face of the deed:
“There is no known burial site, well, solid waste disposal site, underground storage tank, hazardous waste, or private sewage disposal system in the property as described in Iowa Code Section 558.69, and therefore the transaction is exempt from the requirement to submit a groundwater hazard statement.”
The addition of HW 2343 will help streamline the closing process for those buying property in Iowa. However, keep in mind that should the property have any of the conditions listed, the seller will need to complete a separate groundwater hazard statement and file such document with the Recorder’s Office as previously required. If you have questions about recent changes in groundwater hazard statement requirements or wish to know more about the closing process in Iowa, please contact an attorney in your area.
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