Replies to This Discussion

Permalink Reply by adubu on May 1, 2010 at 13:55

If you get foreclosed on your note then the bank can sell the property that secured the loan and if amount received does not satisfy the note they can come after any other asset you have. They can file a lien on your royalty, etc until debt paid in full. The minerals are a separate property in Texas. If you get home improvement loan the home is collateral for the note. Of course in Texas if you sell the property you must state in the deed that you reserve 100% minerals you own if not the minerals will go with the land to new owner. You can own the minerals in Texas for ever without owning the surface land.

Permalink Reply by H1 on May 1, 2010 at 14:34

I understand about having to pay in full by whatever means, but if the minerals are still part of the land, they sell the land and minerals.
The instrument that separates the minerals from the land is what I am looking for (without having to sell the land).

Permalink Reply by adubu on May 3, 2010 at 0:19

It all depends on how the loan note was prepared and what the collateral was for the note. If you are talking about only a "lot" the house was built on then maybe minerals included but if you talking home on large number acres and all the land was put up as collateral then there should be some thing in writting about the minerals. So take no chances and reserve the minerals separately from collateral against the loan as you stated before taking out the loan. In Texas they are separate property

Permalink Reply by H1 on May 3, 2010 at 11:49

Can I separate the minerals with a "special mineral lease"? (before making the loan).

Permalink Reply by Etola on May 3, 2010 at 15:49

If I were you, I would have the house and the area of land it sits on (maybe 1 acre of land) surveyed by a land surveyor and put that up for collateral and try not to tie up all your land. Ususally a home equity loan doesn't require anything but that and then you won't be worried about risking your land and minerals. Or you could set up a living trust fund and deed the minerals to the trust fund with you as the trustee. This could possibly give you a tax break and separate the land from the minerals, but you would have to get an attorney to do it for you.