When you purchase a home, you typically own the house and the land underneath it. But buyer beware. Hidden in the sea of paperwork you sign at closing could be a disclosure stating the home builder or developer will maintain the mineral rights located in the earth underneath your property.
This means that if precious minerals, such as oil or gas, are found to be present, the possessor of the mineral rights will be able to claim and take ownership of those findings.
Many builders in the Valley are using this practice. One builder’s disclaimer was a clause giving the builder “all geothermal energy and recourses located on, in, or under the lot.” Selling or leasing mineral rights has become a multibillion-dollar industry. Make sure to examine the deed clearly to determine if they’re being claimed by another party other than yourself.
How do I find out if someone else has mineral rights on my home?
You can check your deed at the County Recorder’s Office. You can also hire a title company to research the chain of title to find out if your deed is accurate. By performing a title search, you can check if the mineral rights were sold off at some point in the past.
What happens if I don’t own mineral rights and they find some on my property?
According to the legal site Nolo.com, “a mineral owner’s rights typically include the right to use the surface of the land to access and mine the minerals owned. This might mean the mineral owner has the right to drill an oil or natural gas well, or excavate a mine on your property. The mineral owner is also commonly allowed to build roadways or other improvements necessary to facilitate the mineral extraction. Sometimes the terms of the conveyance of the mineral rights restrict the mineral owner’s rights. For example, a mineral deed might put a time limit on how long drilling can continue or restrict excavation to a certain depth. Additionally, to protect the land owner and the environment, state and local laws regulating mining and drilling typically contain restrictions on mineral extraction activities.”
Is a mineral rights disclosure required?
If purchasing land, the seller is required to disclose anything relevant to mineral rights under section 7 of the SPDS form for land/lots. If purchasing an existing home, you’ll want to ensure a thorough title search has been completed.
The real estate website REtipster.com advises those looking to sell their mineral rights to find an attorney who specializes in such. If you have any precious minerals, but no way to access them yourself, selling them could be a viable option. It’s also common for the seller to be awarded a percentage of the findings upon drilling.
Info taken from Arizona Regional Listing Service
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