Tag Archives: legal
Problems With Mineral Rights Leasing
As many people dealing with mineral rights probably knows, mineral rights leasing comes with problems and setbacks. These problems are not easily resolved either, and takes time to overcome. Nevertheless, they can still be solved and taken cared of.
One problem that both parties would have to gloss over mineral rights transactions are the legal procedures. This would include the mineral rights lease and terms of agreement. The wording of the lease agreement has to be very clear to both parties to avoid future disagreements. Problems and disagreements especially arise when the moment comes for mineral extraction. Mineral extraction has such heavy requirements like the expansive use of the land and surface, not too mention the amount of damage it can cause for the surface owner.
This is one of the main reasons why seeking legal help is needed when negotiating with a mineral rights lease. It is also advisable for both parties to have sufficient knowledge on the subject. Respect for the terms in the lease is also needed from both parties. The lease agreement should contain specific details if needed to ensure that there will be less, if not none, disputes in the future.
Legal issues aside, other problems can arise from mineral rights transactions. Damages to the land and property are the main concerns when mineral extraction is underway. It is not only during the extraction, too. Damages to the surface can appear years after the mining and extraction is complete. This would certainly be a headache for owners of fee simple estates. The effects and damages of mineral extraction can ruin the property and will become a problem for the subsequent owners of the area. Take note that the effects can appear many years later, and by this time the mining company may already be gone. No one would then be held responsible and any repairs to the damages would be a burden for the remaining owner of the property.
Aquifers and water supply can also come under fire with mineral extraction and mining. Places where underground extraction takes place are outside of the service of public water supplies. The people would have to content themselves with water wells for water. If the extraction is below the aquifer units tapped by the well, most probably the aquifer would be damaged by the extraction and the water water would drain into deeper rock units. This would lead to a temporary or permanent loss of water supply.
What is important in mineral rights leasing is that all the parties involved should understand wholly what they’re getting into. Mineral rights extraction can cause the surface owner many disadvantages, not only in the present time but also in the future. Legal representatives or lawyers should take care to research carefully and make sure their clients understand the agreement and terms.
When in the midst of negotiations, the leasing terms and agreement is what is to be focused on. Again, both parties should have legal help and should also have full knowledge of the terms. Understanding the risks and the many possibilities in the future is also part of the process. Business such as this naturally have its big problems, and while still early the parties involved should make adjustments.
What Is A Deed Of Trust?
If you live in Alaska, Arizona, California, Colorado, Georgia, Idaho, Illinois, Mississippi, Missouri, Montana, North Carolina, Texas, Virginia, or West Virginia you probably dont have a mortgage, even if the bank, your friends and common chatter call it one. Its more probable that you own your home through a Deed of Trust: something thats a lot like a mortgage but not exactly the same. For legal purposes, mortgages and Trust Deeds are two completely different instruments.
Dont assume that the laws around one apply to the other. Unfortunately, because theyre the most common way of transferring title in over a dozen states, some sloppy commentators confuse the issue by calling Deeds of Trust “mortgages” anyway. Before you do anything with your note, find out exactly what youve got. Dont trust phone conversations. Instead, take a look at your papers or better yet, get a lawyer to look at them.
Obviously, this article is not legal advice but we can give you some informal tips about the key features behind a Trust Deed. They are:
Title to a Trustee: The big, distinctive feature of a Deed of Trust is that its an agreement between three parties: a borrower, a lender and an impartial third party: the trustee. The propertys title goes to the trustee until its paid off, though the borrower can take possession of the property as soon as everybodys signed off on the agreement. Nevertheless, the fact that the trustee has legal title to the property is a significant factor that influences what happens in emergencies such as non-payment of the loan. Trust Deeds are commonly held by a title company.
Promissory Note: Trust Deeds use promissory notes to set down evidence of the debt. The note defines the debt and its conditions, (such as the amount, interest, etc.) so its absolutely necessary to make sure everythings accurate. The lender retains the note until the borrower pays the loan off, after which it is marked “paid in full” and transferred to the borrower.
Rapid Foreclosure: As we mentioned, the trustee has the propertys title, which means that it can initiate a foreclosure and sale itself. For various reasons, most trustees appoint another, separate trustee to handle this. In the event of a default in payment the trustee puts notice in public records for 90 days, initiates 21 days of newspaper advertising and then sells the property. The trustee doesnt even need to take anyone to court. This sale is final, but a borrower can prevent this by coming to some arrangement during the 90 day period of record.
If you think youve got a Trust Deed, take a close look at your papers. Deeds of Trust and promissory notes can both be sold for substantial payouts.