Do you own the land around your house?

Typically, when you purchase a home, you do own whatever lies in and around the property. However, in some parts of the country, homeowners are realizing the land they paid for does not include the land beneath it. Another party, home builders or home sellers, may own the mineral rights.

remaxbcs.com - Do You Really 'Own' the Land Under Your House?

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When you buy property, whether in a rural, suburban, or vacation area, be sure to check if you are buying everything that lies below and above the ground. Typically, when you purchase a home, you do own whatever lies in and around the property. However, in some parts of the country, homeowners are realizing the land they paid for does not include the land beneath it. Another party, home builders or home sellers, may own the mineral rights. This means that, they may turn around and sell some energy company the right to extract gas or oil from your land without your consent, affecting your property value for years while another party collects the royalties. Here are a few precautionary steps to take before you purchase your property.

You Probably Own the Land

Most property ownership law is built on the Latin doctrine, “For whoever owns the soil, it is theirs up to heave and down to hell.” Simply put, you own everything in, around, beneath, and above your property! There are exceptions though. In order to avoid some sort of unexpected third party drilling, carefully review contracts and disclosures.

Review Contracts and Disclosures

Home Builders or homeowners are required to disclose any claims to property rights in the real estate contract or disclosure statement before you finalize your purchase. Disclosure statements vary by state. Numerous disclosure statements in the US require sellers to notify the buyer if someone has laid claim to the property, or if the buyers is limited to claims in the future. If the property you are buying is in a state that does not require such disclosures or if the seller does not have knowledge to such claims, it is in your best interest to review the property’s title before signing the dotted line.

Carefully Evaluate the Preliminary Title Report

The Preliminary Title Report shows the deed that grants access to the land beneath your home. These title reports should go back 100 years so that older leases or deeds granting subsurface rights will be included. Title reports also provide ownership information and acknowledge loans, deeds of trust, easements, encroachments, unpaid property taxes or everything recorded against the property. For instance, if a home-builder deeded mineral rights to their company, the builder would have been required to record that deed. This information will stay on the title report until the builder and current owner agree to remove it.

Make Sure and Dodge Last-Minute Disclosures

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When purchasing property, make sure to give yourself enough time to do your due diligence, either in the duration leading up to the contract before you sign it or as a contingency to the contract. According to Tampa Bay Times, unsuspecting homeowners signed over to the builder’s holding company the “eternal rights to practically anything of value buried underground, including gold groundwater and gemstones”. If that were not enough, homeowners who were unaware they had signed over the mineral rights, or who did so at the last minute under pressure, could have mortgaging the place, now or in the future. Due diligence is basically checking your list by taking caution, performing calculations, reviewing documents, procuring insurance, and checking out the property before you finalize your purchase. A respectable listing agent or seller, in states where disclosure is required, it is common courtesy to shed light on mineral rights to all buyers from the beginning. Buying a home is a risk and it is important to take every precaution. It is crucial to review all documentation, title paperwork and disclosures before signing a contract or during a due-diligence period. Ask your agent to review the documents with you if you are uncertain about something or consider hiring a real estate attorney to examine the paperwork on your behalf. Take safety measures and happy house hunting!

remaxbcs.com - Do You Really 'Own' the Land Under Your House?