What is a deed reservation?

Q: I’ve heard that not all properties come with mineral rights. How do I find out if there is a reservation in the deed? 

A: Even if the seller or real estate agent does not inform you that you are not getting clear title to the entire land, you will know the truth when you receive an abstract title or preliminary title report. Any profit given in the transaction before the sale to you will be recorded in the public records and will be uncovered by a title search. If it is not recorded and you do not know about it, then it will not be legally binding on you.

If you find evidence of a preexisting reservation start your research immediately at the county recorder’s office. Examine the original document to get information on encumbrance.

Types of Reservations:
 
Right of Entry – If someone has been granted the right to extract something from your land, the right of entry is implied unless otherwise stated. When a holder has a right of entry he or she can use the surface in any reasonable manner to perform drilling or extracting materials that are the subject of the profit.

Denying the right of entry is a much safer position as holders will have to obtain permission to enter your property for activities like drilling.

Right to Remove Crops- If land you’re looking at has crops on it you need to find out if the crops have already been sold. If so, this should be reflected with a drop in the selling price. Also, be sure to find out if there is a long term contract for crop-growing rights on the land.

Grazing Rights – If you don’t plan on running your own cattle, you might want to make sure no one else has the right to as well. Livestock can cause considerable damage to your land. If you see cattle when you look at the land make sure to ascertain if their place is permanent or temporary until sale.

Royalty Rights – The current owner may want to retain royalty from drilling or other profit initiatives on your property.

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More Field Reports From The Land Report:

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