Stop sign

April 29, 2012 

D.R. Horton had either been doing something routine, perhaps customary in its home state of Texas, or something a little deceptive. The issue: the company, the nation’s largest homebuilder, apparently had in recent years kept the mineral rights under hundreds of homes sold in North Carolina. Homeonwners asked the state Attorney General’s Office take a look-see as to whether D.R. Horton customers were fully understanding that they were signing away drilling rights in perpetuity.

If this had happened to Jed Clampett, he would have been hunting some city slickers.

The company has abandoned the policy, and the AG’s office discovered that in North Carolina, signing away drilling rights can mean defaulting on a mortgage. Another lesson learned, for the company (don’t do this) and for home buyers (check everything out).

The issue became important originally because of North Carolina’s possible supply of natural gas trapped in shale rock in Lee, Moore and Chatham counties. Drilling rights could be valuable, or disruptive. Buyers must know who owns what.

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