Don’t Sell Your Mineral Rights in Texas – And Here’s Why!
March 19, 2019
Don’t sell your mineral rights in Texas until you are sure that you are selling them the right way.
That might seem like odd advice coming from industry professionals; however, it’s advice that will protect your sale of mineral rights when you finally do decide to market them.
While there a lot of people who’d like to buy from you if you’re selling your mineral rights, chances are if they’ve approached you, they have only their own interests in mind.
Watch out for these red flags if someone wants to buy your interests and think twice before you sell.
1. Be Cautious If They Come to You
The first warning sign that you could be dealing with an unprincipled buyer is that they solicited you about the sale of your mineral rights.
Generally speaking, respected buyers of mineral interests don’t need to seek you out as they work within a network of qualified, trustworthy buyers and sellers where the sellers come to them, not vice-versa.
A company that has solicited you likely has discovered that you own mineral rights interests that that you may not know their true value and want to entice you to sell those rights to them.
2. Recognize the Scam Artists
If you receive a solicitation letter that contains some "too-good-to-be-true" offer for your interests, it probably is.
These are scam offers designed to trick owners looking to sell their mineral rights out of their property by attracting them with remarkable offers.
The scam company will ask you to sign your deed over so the sale can be completed, then suddenly disclose that it’s been realized that your interests are not worth what the original estimate was.
Since you have already signed the deed over, you are powerless to do anything other than accept the lesser amount.
3. Check for Credibility
Another way to detect deceptive buyers before you agree to sell your mineral rights is to research the company’s credibility.
Show some interest in selling but set some requirements to see if they will meet them.
- Ask for a written contract with the amount they are offering and earnest money deposit.
- Insist that your own lawyer prepare the deed and that a title company closes the deal.
- Demand that the buyer deposit with the title company the funds being offered before the deed is closed.
A credible company will agree to all of this; a company looking to defraud you will not do this and claim that they “don’t ever do that."
4. Know the Worth of Your Interests
Regardless of who you intend to deal with in the sale of your mineral rights, it is essential that you have your interest valued by a reputable company so you know what it’s actually worth.
This alone can help you avoid low-ball buyers counting on your ignorance so they can buy low and resell high.
5. Analyze the Contract
The deed and contract involved in mineral rights transactions must contain some specific language that removes you from liability at the time of the sale and into the future.
Many scam companies intentionally leave that language out since in their eyes, it’s better for you to be liable should problems arise than they.
Have a lawyer experienced with selling mineral rights analyze any contract you are considering before signing it to ensure that liability and other critical issues have been properly accounted for.
Don’t Sell Your Mineral Rights to Just Anyone
Before you think about selling your mineral rights in Texas to an unknown, possibly fly-by-night buyer, think again.
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