If there’s one universal truth when it comes to finance, it’s this:

It’s wise to establish a liquid financial safety net.

No matter how much money you make, what line of work you are in, or how much your assets are worth, having access to cash can give you peace of mind should the unexpected occur. 

Anyone can experience medical emergencies, home repair needs, job loss, or any number of other unforeseen events that require access to funds quickly. 

While mineral owners receiving monthly royalty payments can rely on monthly lease payments, minerals have not historically been considered liquid assets. To tap into the value of mineral assets to build a meaningful financial safety net, mineral owners would traditionally need to sell their mineral interests. 

Talk about sacrificing potentially long-term rewards for short-term gains. 

Today, there’s another alternative available to royalty-receiving mineral rights owners who wish to retain ownership of the oil and gas interests: Frontlands Mineral Line of Credit™ (MLOC).

A Mineral Line of Credit is a revolving line of credit built by Frontlands that leverages mineral interest as the underlying credit, empowering mineral rights owners to access value trapped beneath their feet without sacrificing potential future value. 

The Mineral Line of Credit allows mineral rights owners like you to build a financial safety net without selling their rights by providing access to cash when you need it, for as long as you need it. 

But that’s just scratching the surface. There are several benefits of using a Mineral Line of Credit to fund your financial safety net.

Avoid Risking Your Home

Many borrowers think of a HELOC—or home equity line of credit—when they want to access cash quickly. 

HELOCs allow homeowners to borrow money against the equity in their homes. They act like credit cards that the homeowner can draw from as needed and repay over time. 

If this sounds familiar, then you're right. The concept of a HELOC inspired the creation of MLOC, so it's no wonder they may seem to be very similar financial vehicles. 

However, unlike a HELOC, which uses your home as the underlying collateral for your line of credit, MLOC leverages your mineral rights as the underlying collateral—meaning you will not lose your home if you fail to repay the loan. Funding your financial safety net with MLOC instead of a HELOC ensures you will not lose your home if you can't stay on top of payments. 

Leverage Your Royalty Payments to Pay Off a Mineral Line of Credit

Like any collateralized loan, you must stay on top of your payments and make monthly interest payments. Failure to make those minimum payments puts you at risk of losing the collateral you used to secure the line of credit —in this case, your mineral rights. 

However, to open an MLOC, you must receive monthly royalty checks from your producing wells. Because you are receiving royalty checks, you can use that royalty income to pay off your MLOC monthly.  

Discover the Mineral Line of Credit: The Smart Alternative to Selling Your Mineral Rights

With lower interest rates than most traditional credit cards, flexible payment options, and no hidden fees, MLOC is an attractive option for mineral rights owners to create a financial safety net in an emergency. 

See how much your MLOC could be worth by visiting our online calculator.