N.C. Homeowners Face Default For Fracking Leases

Posted by Orb Staff on April 27, 2012 No Comments
Categories : Mortgage Servicing

11428_drill N.C. Homeowners Face Default For Fracking Leases Property owners in North Carolina may be in technical default on their mortgages because they signed natural gas drilling leases without the approval of their lenders.

According to a report in the Charlotte News-Observer, North Carolina Assistant Attorney General Lynne Weaver told state officials that mortgage terms usually prevent property owners from leasing or selling any part of their land until the mortgage has been paid off. By selling or leasing drilling rights, Weaver says, lenders face significant financial risks that include devalued properties and the potential for environmental hazards.

The North Carolina legislature is currently studying whether to legalize fracking in the state. Approximately 80 leases have been signed with natural gas explorers to drill on properties across the state.

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