Under CERCLA and SARA, lenders (both originators and secondary) and purchasers may be exposed to liability for remediation of contaminated property regardless of fault.
In order to meet the “Innocent Purchaser” defense criteria necessary for possible exemption from Superfund liabilities, it is necessary to perform “Due Diligence” reviews. The Phase I Environmental Site Assessment is the process that determines the current condition and potential hidden environmental liabilities of property. Astex Environmental Services (AES) has conducted hundreds of Phase I Site Assessments for mortgage companies, banks, and REO departments in numerous locations throughout the country in a rapid, cost effective manner.
The Phase I Environmental Site Assessment entails, but is not limited to, a complete assemblage of information available from public sources relating to the property, and includes thorough site inspections, agency reviews, title and lease search, historical research and aerial photography review, interviews with interested or site knowledgeable persons and limited testing for asbestos and radon, and often times lead based paint and lead in water. Based on the information gathered, an Assessment of the potential or existing environmental liabilities is determined. This type of review would generally satisfy the requirements of the “Innocent Purchaser” defense. Clients are provided with a complete environmental profile of the property in order to indicate the existence of the possibility of contamination or potential liabilities. A concise, easy to read and understand report is provided to the client, including photographs and test results, along with an understandable interpretation of the results. Included within the Assessment are conclusions and recommendations, including cost estimates, for possible remedial action. In addition, AES subscribes to and practices the ASTM standards for Phase I Environmental Site Assessments and is fully knowledgeable and experienced in the Fannie Mae and Freddie Mac underwriting protocols. All reports include all required Exhibits and Checklists in the standard Fannie Mae/Freddie Mac Phase I Site Assessment.
In addition, AES is prepared to complete the physical property condition and engineering assessment often required for the completion of the mortgage package.