Finder's fee

General Mineral Rights Discussion
1

I would like to know if there is a generally accepted fee or customary finder's fee calculation based on the value of a (npri) royalty property sale, paid by the buyer to the finder.

2

it is totally negotiable. most that i have been involved with have a sliding scale finders fee.

3

Thanks. I also noticed a thread on the forum that mentioned a law limiting finder's fees to < 10% in TX.

4

Define the "sliding scale"? Dependent on the Lease Bonus? Royalty?

5

Try the Lehman Brothers' Scale as a place to begin.

https://en.wikipedia.org/wiki/Lehman_Formula

6

The Lehman Brother's Scale is outdated. I would say anywhere between 5 to 15% would be fair with the 15% number being used on anything sale under $10,000.00

7

Dear Ms. McMahon,

The proper answer is both (Total bonus received and royalty rate).

Buddy Cotten
8

Dear Mr. Elliott,

An example could be where one brought over 5000 acres to a buyer and the commission (not finders fee) was $50 per acre. The bonus amount was $400 per acre. No overriding royalty was kept.

I am betting that the 10% fee that you are referring to is the finders fee for those who locate missing heirs who have money held by the State.

I have also negotiated royalty sales with a commission of 1.5% of the sales price and 5% of the royalty purchased, payable either in kind or in cash.

It's a negotiation.

Buddy Cotten