Environmental
A buyer's best protection against environmental liability in NJ when purchasing commercial property is to:
ARely on the seller's verbal assurances
BCommission a Phase I (and if needed Phase II) Environmental Site Assessment✓ Correct
CRequest only the county environmental records
DRequire the seller to purchase environmental insurance
Explanation
A Phase I ESA (and Phase II if RECs are found) is the standard due diligence practice to identify environmental issues and establish innocent landowner defense under CERCLA.
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Key Terms to Know
Private Mortgage Insurance (PMI)
Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Title InsuranceInsurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
ZoningLocal government regulations that control land use by dividing areas into zones specifying permitted uses, building sizes, and densities.
VarianceOfficial permission to use land in a way that does not conform to the applicable zoning ordinance, granted by a zoning board when strict enforcement would cause undue hardship.
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