Last month I wrote is PayPal safe for domain name transactions. The short answer is no. Not to take anything away from PayPal, they are a great company and one that I use every day. Unfortunately they just don’t have the protections in place for intangible property transactions. As I wrote in my previous article intangible property is something you own but not a physical substance. Because it’s not a physical substance it creates a problem for delivery confirmation.
This is nothing new and something most domainers already know. But for the few of you out their that don’t, Escrow.com is the solution. Escrow.com reduces the potential risk of fraud by acting as a trusted third party that collects, holds and disburses funds according to Buyer and Seller instructions. Escrow services are provided by a licensed and regulated escrow company.
Let me say this one sentence again, a trusted third party that collects, holds and disburses funds according to Buyer and Seller instructions.
How much does this service cost?
Here you can see the fee schedule below. One great feature of their service is fees can be paid by the buyer, seller or split between both. To find out exact costs Escrow.com has an easy to use fee calculator.
A couple fun facts about Escrow.com:
- Holds a $4,000,000 bond
- Audited monthly by an outside firm
- Recommended by eBay for transactions over $500 – link
- In business since 1999
Great post Chef!
I have yet to use an escrow service, but I have heard just how easy Escrow.com and others are to use. I really do wish that Escrow.com had PayPal as a disbursement method though.
It is very easy to use!
PayPal disbursement, lol. What could be better than a bank wire
Oh, I agree…but living in Canada makes international wires pretty pricey for transactions under $500.
True. They can send a physical check, this option just takes a few days for the postal service.
I agree with you Chef and buyers and sellers can always use sedo for a fair fee also.
I do like the Sedo service. It’s just not as easy to use and their service is not licensed in a couple states. Plus no insurance bond, but I doubt they are going anywhere.
Escrow.com is a little scary because they don’t take possession of the domain name, so if you transfer and the buyer changes the whois back to your name, it can get a little sketchy. Luckily Escrow.com has relationships with registrars to help them determine if a domain was actually transferred.
The huge plus side to Escrow.com is that they are lightning fast. I’ve had many transactions initiated and closed the same day. Plus they are quite affordable. Sedo is painfully slow, but more secure. That said, I still usually use Escrow.com.
Very useful comment Mike! I have heard that Escrow.com is ridiculously fast. I look forward to trying them as well as EscrowDNS and Moniker escrow in the future.
I have yet to use escrow.com but when I have the need for a secure payment they will be the one I turn to. I have not heard of any bad stories about their service.
Thanks
Brian
I tend to use Escrow.com for end user sales since most haven’t heard of Sedo or Moniker before. Transactions are very easy to set up and the seller can decide who pays the fees – or elect to have them automatically split between both parties.
Escrow.. I did’nt know this, thanks…