Exclusions when you're trying to short sell?!? Are you serious?

Real Estate Agent

I can't tell you how frustrated I get when I am showing a buyer a home and it says in the MLS that the seller is trying to retain their mineral rights. This may be a problem exclusive to North Texas, but I think the theme is a national one.

When you are trying to sell your home as a short sale, don't be greedy. Losing your home may be the worst thing you have to endure, but showing a dirty, unkempt home is only going to prolong the painful process.

When trying to short sale, buyers want to see a place that is just as nice and well kept as any other property. The short sale home is already at a disadvantage because the process is so difficult and lengthy. And recently I have been hearing that banks want to net a high percentage of the appraised value, so often times they are not the "steal of a deal" that would justify such a hard process. 

But what it boils down to, don't exclude the drapes, the lighting fixture, the BBQ grill, etc. Include everything that is attached so you can sell the home and move on. And don't try to retain an entity that can live on beyond the transaction. It makes you look difficult, and you don't want to start off the transaction looking difficult.  

Comments (4)

David Obbee
Obbee.com - Agoura Hills, CA

Megan: Wow, that's the first time I've heard that one!  Were the sellers planning on coming back and drilling once the short sale went through?  Great point, though- just like beggars can't be choosers, folks in a short-sale situation should recognize their need to be accommodating, no matter how unhappy or frustrated they may be.  Thanks for sharing!

Apr 20, 2010 04:12 AM
Robert Rauf
CMG Home Loans - Toms River, NJ

Megan, I am with David, I have never seen mineral rights EVER in NJ... Perhaps that is just a TX thing.  This looks like your first blog? Welcome to Active Rain!

Apr 20, 2010 04:19 AM
Megan MacLeod
Southlake, TX

No, property owners in Texas own the minerals from their property lines down to the core of the earth. So if drilling is occurring near a home, the oil or gas that they are harvesting is actually owned by those nearby property owners. Sellers can make money on their minerals by signing a lease, and then they get a residual check (and often a signing bonus when they sign the lease). Its not uncommon for home owners to try to retain their mineral rights when they sell their home in hopes that it will provide future income. But most buyers feel that they should get the home in the entirety, including minerals.

Its a hot button issue here and one that has only really become a significant in the last few years since the advance of horizontal drilling technology in 2007, which allows companies to drill beneath homes and neighborhoods (as well as schools, commercial property, airports, etc).

But my blog was more of a rant for short sellers. When you are trying to short sell, trying to keep the minerals is likened to trying to keep light fixtures, its ludicrous. But believe me when I tell you its happening! 

***Just to be clear, Realtors in the state of Texas do not assist with these mineral leases. If a client has questions about mineral leases I refer them to an oil and gas attorney.***

Apr 20, 2010 05:46 AM
Robert Rauf
CMG Home Loans - Toms River, NJ

I agree on the short sale piece, its like they are making your job that much more difficult!  Just learned something new about mineral rights!  who would have thought That I might be able to rent the space under my home, sounds like a great way to make some$$$

Apr 21, 2010 02:52 AM