North Carolina DOJ warns homeowners about leasing
We've heard many informal warnings about the risks which homeowners run when they sign drilling leases. Now the North Carolina Department of Justice has delivered a written (draft) report to the state legislature that puts those warnings on the record.
- ...landowners should be extremely careful when considering ceding drilling rights and legislators should require more information and protections for residents .
- ...the act of leasing without the lender's prior approval could place the mortgage in default.... Storing "hazardous substances" on the site of the mortgaged land also could be grounds for a breach of contract.
- At least two lenders have said they won't make loans for homes where the borrower doesn't own mineral rights or has leased them.
The draft report was presented on April 26 by Assistant Attorney General Lynne Weaver. (Click here for the official site where the document was posted. Be patient!)