When selling a domain through an escrow service, for example Escrow.com, there are typically three options regarding the fees:
- Buyer pays the fees.
- Seller pays the fees.
- Split payment e.g. each party pays half.
Each option has its own backing and reasoning.
If the buyer pays for the fees, you end up engaging in a transaction that the buyer has more at stake, should they considered to back out once escrow has started. At the same time, you end up with more money, which can amount to thousands of dollars over the course of several transactions.
When the seller pays the escrow fees, that’s when the transaction is usually part of a discounted sale, and you – as the seller – want to make it more appealing to the buyer. When you want to close fast, that’s a negotiation argument that you can use.
The split fee option is probably the one used more often. Each party pays half of the escrow fees, thus contributing an equal share to the exchange’s cost. Many domain investors prefer it, as it seems to indicate a balanced fairness in the process.
Personally, I ask that the buyer pays the fees about 80% of the time, with split fees for the remaining 20% of sales.
Whether you choose the buyer, seller or split fee option there is no doubt that Escrow.com is the top tool to use in the domain business; I highly recommend their services after more than ten years of use.
Paying the fees are not bad when the seller pays wire, it is the CC option that does hurt when you cover it, it depends on how tough the negotiation is, and if you are getting the better end of the deal. As most users I mean give their max budget, and do not even think of processing fees, so sometimes it does help to step in, and cover the fee, rather than have the deal stall out, or be delayed when you are almost at the finish line. I recommend people always close quick, options pop up everyday, especially in the spam variety now days.
It depends who I’m dealing with. If I’m marketing to a reseller, I expect them to pay the fee or at least split. For end users, I just cover the fee and include that in my bottom line price. I think most end users don’t understand a lot of the process already so to incorporate a fee just seems to confuse things further.
If I come off of my price, I may negotiate that the buyer pays the fee as an accomodation.
I sell to end users 99% of the time and buyer always pays the escrow fee. Buyer has the option to send me a direct wire transfer and that has no fee. If they choose to use an escrow service then they have to pay for the fee and they can choose how to pay and pay the corresponding fee.
I pay the fee only if I want to make a very small discount and round the price to say 10k.
Most of my sales are to endusers and I have always used Escrow.com. 99% of the time buyer have paid the fee. They don’t even bother asking me to split it. Only on 1-2 occasions buyer asked me to split with them. In that case, if I remember correctly those were domainers.
Hi Everyone,
I just wanted to point out that the buyer has “skin in the game” even when the seller pays the escrow fee since the buyer is responsible for the fee if the transaction is cancelled or the item returned.
Thank you for your continued business.