Any Mistakes To Avoid When I Have Mineral Rights For Sale?
August 1, 2018
To profit from the sale of mineral rights, it’s essential that you go about it the right way to avoid potential pitfalls that could cost you money.
There are many common mistakes that owners of mineral rights for sale make.
If you plan to sell mineral rights, the best advice is to work with a professional royalties company so you can these avoid issues that could leave you losing out to more skilled buyers who may try to take advantage of a less-knowledgeable owner.
1. Believing the Rumors
The truth is, there is a very specific way to estimate what you can sell for based on current market price.
If you deal with buyers effectively, you should be able to get a fair price for your interests; however, that fair price is determined by many variables.
Essentially, every situation is different although most sell for market price. Don’t believe the puffed-up rumors otherwise.
2. Not Understanding the Fluctuation of Prices and Values
To actually get the most in your sale of mineral rights, you must first determine the value of your property.
Many things, including whether or not your interest is currently producing, past production, the need to explore and drill new land, and the current market value determine the value of mineral interests.
The market value fluctuates based on the current demand, the price of oil and gas, and what it is selling for.
Your interests could have a different value every day in a market that keeps going up and down.
3. Not Keeping Good Records
If you are already receiving royalty checks, holding onto your check stubs as proof is essential to determine the value of your interest.
As easy as it may be to toss them once the check has cleared, hold onto at least 6 to 12 months' worth of stubs to show any prospective buyer of mineral rights for sale.
4. Not Selling Through A Network
When you are ready to actively sell mineral rights, you should advertise your interests for sale in the right places.
The best place for you to do that and where you can attract multiple buyers who can bid on your sale of mineral rights is through a mineral exchange.
Selling through an exchange where buyers compete to buy from you helps you get the fairest price.
5. Accepting the First Offer You Receive
As exciting as it may be to get an offer on the mineral rights you are selling, avoid acting too quickly.
As mentioned previously, the best way to be certain that you get what your property is actually worth is by presenting your offers to a wide audience and waiting for bids to come in.
The first offer you get is likely not going to be at market value; buyers expect to compete against each other.
Avoid These Mistakes When Selling Mineral Rights
The easiest way to avoid the common mistakes that could prevent you from getting full value from your sale of mineral rights is to work with a reputable royalties company.
These professionals are experienced at determining the value of mineral rights for sale and have access to networks of trusted buyers willing to pay fairly.
Sell mineral rights with caution to ensure the best transaction!
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