One of the questions we’re asked most often is ‘should I use an escrow service when buying or selling my website?’ and our answer is always ‘it depends.’ But on what? Today we’re taking a look at some of the factors that might affect your decision to use an escrow service when buying or selling a site or domain.
First off, it depends whether you’re buying or selling a website. In website escrow, the buyer is liable for the escrow fees, so if you’re buying a lower-value site, you may want to keep your costs down by skipping the escrow process. We generally say that escrow starts being worthwhile with sites valued at £10,000 or more. So, if you’re buying a high-value site, your answer to the question to escrow or not to escrow? is most likely a resounding ‘yes.’
So what do you get for your fees when you use an escrow service, and is one escrow service better than the rest? The answer to the first question is peace of mind: using escrow means you can be sure of a smooth transition of ownership. In answer to the second question, we always use escrow.com, as it’s reliable and geared towards the sale of sites and domains. Escrow.com performs a full transitional analysis, which includes checking the WHOIS database of the appropriate Registrar to make sure the new buyer’s name is the domain name Registrant. When they’ve confirmed this, payment is released to the seller.
In our experience, this is a smooth, reliable process and one that guarantees both the buyer and seller are satisfied with the transition of ownership.
If you’re selling your site, but the buyer opts to skip the escrow process, should you worry? In our experience, the answer is a big fat no, since most of the risk is on the buyer’s side. Of course, if you’re selling a high-value site, you may wish to specify that buyers must be willing to use escrow, but in general, this shouldn’t be too much of an issue for you.
In short, our advice is that for low-value transactions it’s fine to skip escrow, but for sites or domains valued at over £10,000, it’s definitely worthwhile.